The assessee was engaged in trading in high-end kitchen appliances, cooling and coffee machines and laundry and floor care appliances. The Assessing Officer observed that the assessee had not commenced business during the first seven months of the year 2010-11. \u00a0He disallowed the expenditure of the first seven months as pre-operative expenses. The CIT (A) deleted the addition on account of pre-operative expenses. On appeal the Tribunal held that (i)\u00a0 the assessee had commenced its business in the previous year relevant to the earlier assessment year. \u00a0Therefore, the expenses considered as pre-operative expenses by the Assessing Officer had to be treated as legitimate business expenditure for the year 2010-11. \u00a0\u00a0(ii) He was satisfied with the advertisement, marketing and promotion expenses incurred by the assessee. \u00a0Public memory is very short and companies had to incur advertisement expenditure year after year to keep their products fresh in the minds of the public. \u00a0Such expenditure could not partake of the character of giving any enduring benefit. \u00a0The Assessing Officer had erred in treating such expenditure as creating an intangible asset. \u00a0\u00a0(AY. \u00a02010-11)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 37(1) : Business expenditure-Pre-operative expenses-advertisement, marketing and promotion expenses to keep products fresh in minds of public-No enduring benefit-Allowable as revenue expenditure.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-8569","post","type-post","status-publish","format-standard","hentry","category-digest"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-2ed","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/8569","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=8569"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/8569\/revisions"}],"predecessor-version":[{"id":8570,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/8569\/revisions\/8570"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=8569"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=8569"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=8569"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}