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TMI Blog2017 (5) TMI 1592X X X X Extracts X X X X X X X X Extracts X X X X ..... .125/2016 and 134/2014 on 04.10.2016 has framed the following substantial questions of law: "(i) Whether the Tribunal was legally justified in deleting the addition of Rs. 91,83,353/- made on account of inventories written off specifically when neither any details were furnished by the company and nor there was any supporting evidence to justify and establish that the inventories were actually destroyed? (ii) Whether the Tribunal was legally justified in deleting the addition of Rs. 23,44,747/- and allowing deduction u/s 37, on account of advertisement expenses specifically when the payment was made to a foreign company which was liable to deduction of tax at source in view of section 195, the failure of which attracted section 40(a)(ia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alued at cost or market price whichever is lower and these inventory has no value, the same is to be allowed to the assessee in view of the accounting principles and the ratio laid down by Hon'ble Supreme Court. CIT Vs. Hotline Teletube and Components Ltd. 175 Taxman 216 (Del.): Provision for diminution in value of stock is allowable as business loss. 8.10. In view of above, it is contended that asessee's claim of inventory written off is fully allowable." 4. Therefore, the observations made by the Tribunal in the earlier year where appeal was preferred but this question was not admitted and the same issue is squarely covered by the decision on issue No.(ii) of appeal No.134/2014 as above. 5. Regarding issue No.(ii) & (iii), the same are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dly, payment to Group M Media India Pvt. Ltd. is a payment to resident and not a non resident. Therefore, section 195 is not attracted. The AO has not disputed the genuineness of the payment and therefore only because there is no agreement for the advertisement work with this company cannot be viewed adversely. Therefore, the disallowance of Rs. 36,70,04,056/- made by the AO is incorrect, against law and the same is deleted. So far as expenses on trade incentive is concerned, we find that similar incentives given as per various schemes in earlier years has been allowed. The AO at Page 2 of the order has admitted that bills and vouchers of expenses, as desired, were produced for verification which was test checked. The observation of AO th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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