- (1.) THIS appeal raises a simple issue which is arising as a result of certain incongruity arising from the Tribunal's own order which is principally not under challenge.
(2.) THE questions which have been framed at the time of admission of the appeal are as under : 1. Whether, while considering allowance of revenue expenditure incurred for advertisement during any assessment year can be spread over by an assessee on principle of deferred revenue expenses on the ground that the benefit of such expense would flow for subsequent years also ? 2. Whether, in the facts and circumstances, the AO having accepted the principle of spreading over of expenses incurred in one assessment year by treating the same to be deferred revenue expense for earlier years and did not allow the deduction of full amount of expense was right in refusing to allow the deduction of unadjusted expense during the assessment year in question on the ground that the principle of spreading over of allowable revenue expenditure is not permissible in law ? The factual matrix on which these questions have arisen relates to the claim of the assessee for deduction under Section 37(1) for the expenses incurred by him on advertisement through audio visual media which in turn creates certain rights in audio -visual clippings which are published and advertised through the medium of audio -visual films whether by telecasting or through the clippings shown on the screen in the cinema halls. Since the assessee was deriving the benefit of expenditure of advertisement through video -clippings spreading over certain period, it has adopted a policy of spreading over the expenses for number of years depending upon the period during which the clippings are likely to be used instead of claiming entire expenses for one year in which the amount has been paid to the producer of the clippings.
(3.) ACTUAL expenses are incurred and it is spread over from 1991 to 1994 -95 as has been noticed by the Tribunal in its order dt. 28th Jan., 2002 while disposing of the appeal for number of assessment years from 1993 -94 to 1995 -96.;