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TMI Blog1998 (11) TMI 153X X X X Extracts X X X X X X X X Extracts X X X X ..... sed in this appeal is that the learned CIT(A) erred in sustaining the disallowance of Rs. 47,654 under r. 6B of the IT Rules. The AO made the disallowance under r. 6B of a sum of Rs. 65,704 being the cost of presentation articles. The learned CIT(A), on verification came to the conclusion that the amount in excess of Rs. 50 per article is actually Rs. 47,654. He came to the conclusion that the exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resentation articles and that the disallowance made under r. 6B is wholly untenable. The learned Departmental Representative supported the order of the first appellate authority. 4. Rule 6B of the IT Rules deals with expenditure on advertisement. Rule 6B(1) provides that the allowance in respect of expenditure on advertisement should not inter alia in respect of articles intended for presentatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iness. It is not meant for the purpose of advertising the products of the company. Hence, the disallowance made under r. 6B of the IT Rules is not sustainable. Similar view was taken by the Bombay High Court in the case of CIT vs. Allana Sons (P) Ltd. (1993) 114 CTR (Bom) 448 : (1995) 216 ITR 690 (Bom) and the Delhi High Court in the case of CIT vs. Associated India Exports (1992) 107 CTR (Del) 17 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he purposes of business and that interest on funded interest has to be allowed as an expenditure under s. 36(1)(iii) r/w s. 37(1) of the IT Act. The learned Departmental Representative supported the order of the first appellate authority. 6. Regarding the claim of interest on funded interest, the learned CIT(A) held as follows: "Regarding the interest on interest on unpaid loans, the same is n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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