COMMISSIONER OF INCOME TAX Vs. PUNJAB TRACTORS LTD.

JUDGEMENT

(1.) THE Revenue has approached this Court by invoking s. 260A of the IT Act, 1961 (for brevity 'the Act') challenging the 96/Chd/1995 in respect of the asst. yr. 1989 -90. While admitting the appeal, a Division Bench of this Court has framed the following question of law :

(2.) IN order to adjudicate on the aforesaid question, it may first be necessary to notice few facts. The assessment in respect of asst. yr. 1989 -90 was completed under s. 143(3) and the following additions were made :

(3.) THE assessee filed an appeal before the CIT(A) who deleted the additions made on account of payment of rent paid to guest -house and other items. The Revenue being dissatisfied with the view taken by the CIT(A) preferred a further adjudication before the Division Bench of this Court, the question of law produced in the preceding para was considered to have emerged for determination of this Court. It is appropriate to notice that the assessee respondent has claimed expenditure of Rs. 1,05,306 on account of export promotion, publicity expenses and advertisement outside India. Another sum of Rs. 37,933 was also claimed for articles presented or intended for presentation where expenditure on each article had exceeded Rs. 50. The AO held that expenses on these articles cannot be held fully exclusively for business purposes as the logo or name of the company was not inscribed on all the items. The AO in his order dt. 23rd