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TMI Blog2013 (7) TMI 726X X X X Extracts X X X X X X X X Extracts X X X X ..... of the current year can be different necessitating departure from the earlier order – Decided against the Assessee. Rectification of mistake u/s 254 – Held that:- Issue raised is against the confirmation of disallowance of Rs.81,31,389/- on account of write off of small debit balances. Assessee contended that such ground was not pressed - The rectification of such types of mistakes committed by the rival parties cannot be brought within the purview of the proceedings u/s 254(2) of the Act. Disallowance of advertisement expenses - Tribunal dismissed the assessee's ground by holding such expenses to be of the earlier year. He submitted that the assessee was following such consistent practice in earlier years as well which stood accept ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applications at the threshold and taking up the remaining two miscellaneous applications for the AYs 1998-199 and 1999-2000, which cover all the issues raised from the orders in relation to the assessee's and the Revenue's appeals. 2. At the very outset, the ld. Counsel for the assessee submitted that four issues have been raised in the miscellaneous application pertaining to the A.Y. 1998-1999, out of which two issues are common in the MA for the A.Y. 1999-2000. A.Y.-1998-1999 3. First issue raised in the miscellaneous application is against the confirmation of disallowance of advertisement expenses amounting to Rs.85,58,803/-. The ld. AR contended that the Tribunal dismissed the assessee's ground by holding such expenses to be of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng cash system of accounting. But if mercantile system is followed, then an item of expense qualifies for deduction at the time of incurring irrespective of the date of payment. As the assessee incurred liability in respect of the expenses in question in the preceding year when it availed the benefit, the correct occasion for allowing deduction under the mercantile system of accounting is at the time of incurring of such liability and not when such liability is paid out. It is further relevant to note that the Tribunal has also recorded in the impugned order that the assessee will be at liberty to take remedial action for deduction in the relevant year as per law. In that view of the matter, we are of the considered opinion that there is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The judgment in the case of Bagona Udyog (supra) is on a point in which the no concession was made by the party, but it was wrongly recorded by the tribunal as a concession in its order. It was under such circumstances that the miscellaneous application was held to be maintainable. It is quite natural that the tribunal having wrongly recorded the matter of concession, which was in fact, not given, was bound to correct this mistake. However, the facts in the present case are different in as much as the Ld. AR chose not to press this ground in the proceedings u/s 254(1). In that view of matter, it cannot be said that the Tribunal wrongly recorded in its order that the ground was not pressed, which was, in fact, so pressed. Thus, it is paten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed order for rejection of such claim. This issue has been discussed threadbare in the light of judgments of the Hon'ble Supreme Court in the case of Punjab State Industrial Development Corporation Ltd. and Brooke Bond India Ltd. As regards the contention about the availability of deduction u/s 35D, again we find that such contention has been rejected by relying on the judgment of the Hon'ble Delhi High Court in the case of Hindustan Insecticides Ltd. [(2001) 250 ITR 338 (Del.)]. Apart from that, another Tribunal order passed by the Mumbai bench of the tribunal has also been taken into consideration for reaching the conclusion against the assessee. The mere fact that no addition was made on this issue in the earlier year cannot be determinat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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