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Issues involved: Determination of disallowance of entertainment expenditure u/s 10(2)(xv) for 1961-62 assessment year and u/s 37(2A)/(2B) for 1970-71 and 1971-72 assessment years; entitlement to deduction for expenditure on feasibility of a hotel project in Goa for 1971-72 assessment year.
Entertainment Expenditure Disallowance: The court declined to answer the first question regarding the disallowance of entertainment expenditure due to the absence of further particulars necessary for assessment. The assessee's counsel stated the unavailability of such particulars, leading to the court's inability to address this issue. Feasibility Expenditure Deduction: The second question pertained to the deduction claim for expenditure on exploring a new business line, specifically setting up a hotel in Goa by a travel agency business. The Tribunal ruled that such expenditure was not admissible as a deduction. The court agreed with this decision, noting that a travel agency business does not inherently include hoteliering activities. Consequently, the second question was answered affirmatively in favor of the Revenue. Conclusion: No costs were awarded in this matter.
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