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2013 (10) TMI 1368 - ITAT CHENNAIExpenditure towards programme, production expenses, amortization of film and serial broadcasting rights, cost of programme content (rights) and expenditure towards consumables and media - revenue or capital expenditure - Held that:- After first telecast, the assessee does not discard the films but carefully store the same in digital library for airing the same again. Therefore, the assessee gets enduring benefit from the rights acquired in films and serials and they do not expire on the date of first telecast as contemplated by the assessee. The rights are intangible assets within the meaning of Explanation (iii) to Section 32 and do not fall within the purview of Section 37(1). The assessee is entitled to claim depreciation on same. Write-off of advances given for production of films - Held that:- In the course of purchasing movie/serial rights, advances are given to the producers/production houses of the serials and the movies. In some of the cases, the amounts given as advance become bad-debt and hence become ir-recoverable. The assessee has no other option but to write-off the same. The Assessing Officer disallowed the claim of the assessee on the ground that the assessee is not in the business of purchase and sale of movies. On appeal, the CIT(Appeals) reversed the findings of Assessing Officer by following the judgment in the case of Turner Morrison & Co., Ltd., Vs. CIT, (2000 (3) TMI 34 - CALCUTTA High Court) and CIT Vs. Bhagwarprasad (1999 (9) TMI 5 - GUJARAT High Court ). We do not find any infirmity in the findings of the CIT(Appeals) on this issue. Deferred income - assessment year - Held that:- It is not disputed that the income generated by selling the time-slot is offered as income in the year of broadcasting/airing the programme. The monies received are shown as deferred revenue in the year of receipt and are offered as income in the year when programme is aired. We do not find any illegality or irregularity in methodology adopted by assessee in registering the revenue in the year of telecast of programme. There is no merit in this ground of appeal of the Revenue
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