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2018 (4) TMI 1595 - ITAT DELHIDisallowance of expenditure incurred on management service fees - revenue v/s capital expenditure - Held that:- There is a clear finding that incurrence of management fee expenditure is to acquire the managerial support services for the day to day operations of the assessee’s business and ongoing basis for which quarterly payments were made there was no endeavor benefit or any underline nature of service obtain by the assessee which involves transfer of technology or asset or technical information/knowhow in any manner. It is pertinent to note that the Revenue in particular years has accepted this expenditure as Revenue Expenditure and segregated this particular year by disallowing it as capital expenditure but while doing so, the Revenue has not given any finding to the extent that as to why these are capital expenditure. Disallowance of expenditure incurred on Software EDP Charges paid to Swarovski Hong Kong Ltd. - revenue v/s capital expenditure - Held that:- The said charges are business expenditure and cannot be treated as capital expenditure. The assessee has field all the invoiced to that effect. There was no assets acquired by the assessee and it is a period cost but from the order of the Assessing Officer it can be seen that the said details as contemplated by the assessee was not before the Assessing Officer . Therefore, this aspect has to be verified at the level of. Therefore, this issue is remanded back to the file of the Assessing Officer to see these expenses according to the evidence produced by the assessee. Disallowance of 2/3rd expenditure incurred on an advertisement and capacity expenses on the ground that benefit will accrue over a period of 3 years - Held that:- Following the view taken in our order for the A.Y. 2004-05, we hold that the entire amount of advertisement and publicity expenses should be allowed as deduction in the year of incurring itself. It is however, made clear no further deduction for 2/3rd of the total expenditure for the earlier years be granted as the same will lead to double deduction. If such a deduction has already been allowed, then the same should be reversed to that extent. This ground of the Revenue is not allowed.
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