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Section 35D of the Income-tax Act, 1961 - Preliminary expenses Question as to amortization of professional fee, is a substantial question of law [Assessment year 2001-02] CIT v. Salora International Ltd. [2009] 308 ITR 199 (Delhi) The question as to whether the Tribunal was correct in law in deleting the addition made by the Assessing Officer by amortizing the expenditure towards the professional fee paid to a company towards the project of 'Supply Chain Management & Human Resource Revenue - Engineering', by allowing only a deduction of 1/5th as expenditure, was a substantial question of law. Section 35D of the Income-tax Act, 1961 - Preliminary expenses ADVERTISEMENT EXPENDITURE Advertisement expenditure for launching products is revenue expenditure [Assessment year 2001-02] [In favour of assessee] CIT v. Salora International Ltd. [2009] 308 ITR 199 (Delhi) The assessee claimed deduction of advertising expenditure of approximately Rs. 3.08 crores. According to the Assessing Officer, the expenditure was incurred for launching of its products. The Assessing Officer was of the view that such expenditure was of an enduring nature and, therefore, treated one-third as 'capital expenditure' and only allowed the two-thirds of the said amount as 'expenditure to the assessee'. Held that the Tribunal held that there was a direct nexus between the advertising expenditure and the business of the assessee and that the assessee had to incur such expenditure to meet the competition in the Indian market for selling its products in India. It, therefore, allowed the assessee's claim. No interference was required with the Tribunal's order. Ms. Premlata Bansal for the Appellant. P.N. Monga and Manu Monga for the Respondent. JUDGMENT 1. This is an application for condonation of delay in filing the appeal. Apparently there is a delay of about 12 days in filing the appeal. Although the application mentions only 9 days delay. The reason given for the delay is that the CCIT had directed that the opinion of the senior standing counsel be sought. This was done by a letter dated November 16, 2007. The senior standing counsel had given the opinion on November 27, 2007, and forwarded…

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