Case Law Details
Steller Films Pvt. Ltd Vs ACIT (ITAT Mumbai)
ITAT Mumbai held that expenditure relating to film which was not released and hence not co-relatable to any income, cannot be disallowed as the expenses were incurred wholly and exclusively for the purpose of the business.
Facts-
The assessee before us is a company engaged in the business of cinema photographic films. During the course of the scrutiny assessment proceedings, the Assessing Officer noticed that the assessee has claimed legal and professional fee of Rs. 27,40,834/- but “since it is not an expenditure co-relatable to any income credited in the profit and loss account during year under consideration” the said expenses were disallowed. The plea of the assessee that these amounts were paid to the lawyers to represent the assessee before Hon‟ble Bombay High Court as there was dispute with respect to film “Sher” with Ashthivinayak Cinevision, the entity which was to produce the same under arrangements with the assessee, was rejected. Aggrieved, assessee carried the matter in appeal before the CIT(A) but without complete success. Aggrieved, assessee is in further appeal before us.
Conclusion-
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
