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2021 (4) TMI 621 - AT - Income TaxDisallowing on account of expenses incurred in giving free samples of veterinary medicines - AO observed on the basis of details furnished by the assessee that these expenses are mostly incurred to give free samples to veterinary doctors and these veterinary doctors are further supposed to distribute the same to their patients so that the business of the assessee flourishes - HELD THAT:- The sample distributed for marketing these products by the assessee is not in violation of any guidelines issued by the Veterinary Council of India or Medical Council of India. Besides the said regulations are applicable to the doctors and their associate professionals and not to the company engaged in manufacturing of these veterinary products. In fact these expenses are incurred wholly and exclusively for the purpose of increasing the sale of the company by making these samples available to the end user and also studying the effect of those products on animal and birds. Moreover the case of the assessee is supported by the decisions as referred and relied before the ld CIT(A) by the assessee. In the case of Max Hospital Vs MCI [2014 (1) TMI 1829 - DELHI HIGH COURT] has held that regulations issued by MCI are applicable to medical professional and not to the pharmaceutical companies. Hon’ble Apex Court in the case of Eskayel Pharmaceutical's India Ltd [2000 (7) TMI 1 - SUPREME COURT] has held that physician samples are must in order to ascertain the efficiency and efficacy of the medicine and introduce the same in the market for circulation. We are in agreement with the conclusion drawn by the Ld. CIT(A) on this issue. Accordingly, we uphold the order of Ld. CIT(A) by dismissing the appeal of the revenue.
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