Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2006 (11) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2006 (11) TMI 162 - RAJASTHAN HIGH COURTDisallowance u/s 37 - expenses incurred on sponsorship Of tournament - activity of sports - element of publicity or advertisement - HELD THAT:- It is no gainsaying that sponsoring of a tournament in which the display of the sponsor's name and banners with the name of the assessee-company attached with the trophy would receive wide publicity through newspaper reports and, in itself, thus establishes the advertisement value which the assessee will get to promote its business. We are in agreement with the Tribunal's finding that the expenses incurred by the assessee for sponsoring the trophy had the ingredient of advertisement of its business and, consequently, the assessee's claim to deduction as expenses wholly and exclusively incurred for the purpose of its business is justified. It will be profitable to notice here that the Tribunal itself has confirmed disallowance of deductions in respect of a benefit match in the assessment order of the previous year in which neither the name of the assessee was published in the brochure issued on the eve of the benefit match nor was it established by any evidence that such expenditure was in the nature of business advertisement. Thus, the distinction reflects the real nature of the sponsorship value. Where the sponsorship carries the advertisement of the business it carries advertisement value for promoting the business. Thus, this appeal fails and is hereby dismissed.
|