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TMI Blog2019 (1) TMI 1197X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer to allow 1/5th expenditure and balance amount would be allowed for the next four financial years - Held that:- We are of the considered opinion that once the CIT(A) has accepted that distributor’s commission and distributor’s incentive are revenue expenditure, there is nothing like deferred revenue expenditure. Moreover, the distributor’s commission and incentive paid by the assessee will not be recovered if the lessee i.e. the customer cancels the lease after one year. Therefore, any commission/incentive paid by the assessee has to be charged to the profit and loss account as revenue expenditure in the year of incurring the same. We, accordingly, modify the findings of the CIT(A) and direct the Assessing Officer to allow dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 4538/DEL/2013, CO No. 190/DEL/2011 - - - Dated:- 18-1-2019 - Shri N.K. Billaiya, Accountant Member, And Ms. Suchitra Kamble, Judicial Member For the Assessee : Shri Rakesh Gupta, Adv, Shri Somil Agarwal, Adv And Shri Shubnam Sobti For the Revenue : Ms. Shefali Swaroop, CIT-DR And Ms. Ashima Neb- Sr. DR ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER, The appeal by the Revenue in ITA No. 2158/DEL/2011 and cross objection by the assessee are preferred against the order of the CIT(A)- 13, New Delhi dated 17.02.2011 pertaining to A.Y 2006-07. The Revenue has also filed an appeal against the order of the CIT(A) dated 2.5.2013 pertaining to A.Y 2006-07. Since the underlying facts and issues involved in these appeals and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... policy, the prices of these equipments were reduced by ₹ 57,52,391/-. 5. In the interest of its business, the assessee compensated this fall in prices and debited the same in its Profit and loss account as related to excess/short amount received from the consignees on account of scheme conversion. The Assessing Officer treated this as a non- Revenue expenditure, whereas the first appellate authority has directed the Assessing Officer to allow the same as business loss. 6. As explained above, the change in the policy was accepted by the Assessing Officer and no malafide intention has been brought on record on the part of the assessee. Any loss incurred by the assessee in respect of trading goods has to be allowed as business los ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee will not be recovered if the lessee i.e. the customer cancels the lease after one year. Therefore, any commission/incentive paid by the assessee has to be charged to the profit and loss account as revenue expenditure in the year of incurring the same. We, accordingly, modify the findings of the CIT(A) and direct the Assessing Officer to allow distributor s commission and distributor s incentive as revenue expenditure. 10. Ground Nos. 1 and 2 of the cross objections of the assessee are allowed and related grounds in Revenue s appeal are dismissed. 11. The next grievance of the Revenue s appeal relates to freight and cartage outward holding it as capital loss/capital expenditure in nature. 12. It appears that the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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