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2018 (5) TMI 587 - ITAT MUMBAITransfer Pricing [TP] adjustment against Advertising, Marketing & Sales Promotion Expenses [AMP] - Held that:- We find that similar issue of AMP adjustment arose in assessee’s own case for AY 2010-11 wherein the Tribunal [2018 (1) TMI 1033 - ITAT MUMBAI] deleted the impugned adjustment, inter-alia, on the premise that in the absence of any agreement / arrangement between assessee and its Associated Enterprises [AE], the aforesaid transaction could not be termed as international transaction. Expenditure incurred by assessee in respect of foreign trips of doctors - allowable busniss expenditure - Held that:- The nature of expenses incurred by the assessee is not clear i.e. whether the same has been incurred to sponsor foreign visits of doctors to attend seminars or conferences relating to assessee’s products or whether the same are in the nature of freebies to the doctors. In our opinion, the expenditure incurred by the assessee to sponsor foreign visit to generate knowledge about the company’s products was clearly allowable u/s 37(1) and there was no restriction per-se regarding allowability of the same. Therefore, the matter stands remitted back to the file of Ld. AO for appreciation of the factual matrix and to be decided as per law after providing opportunity to the assessee to demonstrate the nature of these expenses. Disallowance of depreciation on Goodwill - Goodwill did not fall under specific intangible assets as mentioned in Section 32 - Held that:- This issue stood squarely covered in assessee’s favor by the decision of Hon’ble Apex Court rendered in CIT Vs. Smifs Securities Limited [2012 (8) TMI 713 - SUPREME COURT] wherein it was held that Goodwill was an intangible asset eligible for depreciation u/s 32. Accordingly, by deleting this addition, we allow this ground of appeal. Depreciation on Plant & Machinery & Building - claim disallowed since these assets remained idle since manufacturing process stood discontinued - Held that:- We are of the opinion that once an asset forms part of block of asset, it loses its individual identity and further, there is no requirement that each and every item in the said block should actually be used in the impugned AY so as to entitle the assessee to claim depreciation thereupon. Otherwise also, this issue stood covered in assessee’s favor by the cited order of the Tribunal in assessee’s own case for AY 2010-11. Therefore, this addition stand deleted. Advances written-off allowability - Held that:- Advances are primarily in the nature of advance for shipping & handling charges, advertising material, freight, packing, hotel booking, project hiring, consultancy charges, booking charges etc. which are primarily in relation to business activities carried out by the assessee in normal course of business and hence, allowable as Business Loss u/s 28 as per the decision of Hon’ble Bombay High Court rendered in Harshad J Choksi Vs CIT [2012 (8) TMI 710 - BOMBAY HIGH COURT]. Respectfully following the same, the impugned addition is deleted. Trading advances (bad debts) written off - Held that:- We find that since the said disallowance has been made by lower authorities for want of adequate information / details, the issue needs to be remitted back to the file of Ld. AO in the light of additional evidences submitted by the assessee hat the impugned expenditure was nothing but bad debts written-off and hence allowable in terms of decision of Hon’ble Apex Court rendered in TRF Ltd. Vs. CIT [2010 (2) TMI 211 - SUPREME COURT ].
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