It has been held by the Hon’ble Appellate Tribunal that the club membership had been obtained in the name of the assessee and the representatives of the assessee used the club for entertaining present and prospective customers. This was certainly meant for the purpose of business of the assessee and to be construed as an expenditure incurred as a measure of commercial expediency. Hence, AO was not justified in treating the expenditure on club membership as personal in nature. (AY. 2014-15)
Cherry Hill Interiors P. Ltd. v. Add. CIT [2023] 105 ITR 34 (Delhi)(Trib.)
S. 37(1) : Business expenditure-Club membership fees-Club membership used by representatives of assessee for entertaining present and prospective customers-Commercial expediency-Allowable expenditure.