Assessee had incurred an expenditure under its Trip Scheme for its dealers. Assessing Officer disallowed expenditure on basis that entire trip of dealers was not for business purposes. Tribunal held that in assessee’s own case for preceding assessment years had deleted similar disallowance holding that entire trip scheme was for purpose of expanding assessee’s business by encouraging dealers and distributors to achieve a specific target of purchase and, thus, scheme was closely linked to assessee’s business activity.Following decision of Tribunal disallowance is rightly deleted by Commissioner (Appeals). (AY. 2014-15)
Asian Paints Ltd. v. ACIT (2024) 205 ITD 680 (Mum)(Trib)
S.37(1): Business expenditure-Trip for dealers-Expenditure incurred by assessee under its trip scheme for its dealer for purpose of expanding assessee’s business by encouraging dealers and distributors to achieve a specific target of purchase being closely linked to assessee’s business activity is allowable expenditure.