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2017 (3) TMI 140 - AT - Income TaxAdvertisement and selling expenses - treatment of the expenses in the books of SCL and the Assessee cannot be different - Held that:- As rightly contended by the assessee, the treatment of the expenses by SCL was not conclusive in the matter. Admittedly the sum capitalized by SCL in its books of account had been reimbursed to the assessee and to this extent the parties agreed that the expenditure created brand enhancement of brand SPENCER’S of SCL. The expenditure to the extent claimed by the assessee as a deduction, was never the subject matter of treatment in the books of accounts by SCL. Moreover, the treatment of the very same expenses by one of parties to a transaction in it’s books of account cannot bind the other party. The nature of expenses incurred by the Assessee was given (though it was a general description) and not disputed by the AO. The conclusion of the CIT(A) in this regard is not based on any material. Even otherwise, the question whether expenditure promoted the brand of SCL or was incurred to promote the sales of the Assessee becomes academic. The decision of the Hon’ble Mumbai Bench of ITAT in the case of Brightest Circle Jewellery (P)Ltd., (2012 (10) TMI 238 - ITAT, MUMBAI ) clearly supports the plea of the assessee that the expenditure incurred by a person who is not the owner of the trade mark but which is used by an assessee had to be regarded only as a revenue expenditure. We are therefore satisfied that the claim of the assessee for deduction as revenue expenditure deserves to be accepted. - Decided in favour of assessee Disallowance under section 14A read with Rule 8D - Held that:- As the assessee had not earned or received any dividend income during the previous year, we are of the view that there can be no disallowance u/s 14A of the Act. Accordingly the addition made u/s 14A of the Act is directed to be deleted. See Commissioner of Income Tax Versus M/s. REI. Agro Ltd. [2014 (4) TMI 713 - CALCUTTA HIGH COURT]- Decided in favour of assessee
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