2001 (4) TMI 68

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..... the following questions for our opinion: "1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the Commissioner of Income-tax was wrong in directing the Assessing Officer under section 263 of the Act to invoke the provision of section 37(3A) of the Income-tax Act in respect of the expenditure on calendars, panchangs and diaries? 2. W .....

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..... preparations and markets the products in the name of "Dabur". The assessment year involved is 1985-86. During the accounting year relevant to this assessment year, the assessee has incurred expenditure on the following items: "1. Calendars. Rs. 5,20,461 2. Panchang Rs. 3,82,862 3. Diaries Rs. 2,36,725 -------------- .....

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..... e view that there is no justification to invoke the provisions of section 37(3A) for disallowance on the aforesaid expenses. The Tribunal has further taken the view that once the provision of section 37(3A) of the Act has been invoked for disallowance on the hotel expenses, no further disallowance can be made invoking the provision of section 37(2A) of the Act. None appeared for the assessee tho .....

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..... Therefore, the distribution of samples should be treated as an expenditure incurred towards advertisement, publicity or sales promotion. Considering the facts of this case, the Revenue stands on a better footing in the case in hand, i.e., the expenditure on calendars, panchang which gives the details and publicity of the company and its product is for the purpose of publicity and advertisement .....

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..... , publicity and sales promotion. Once the expenditure in question was treated as expenditure pertaining to sub-section (3A) of section 37, that cannot be again treated as expenditure referred to in sub-section (2A) of section 37. Therefore, there is no infirmity in the order of the Tribunal in this regard. In the result, we answer questions Nos. 1 and 2 in the negative, i.e., in favour of the Re .....

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