GALDERMA INDIA P. LTD., MUMBAI V. ASSTT. CIT - 9(3)(2), MUMBAI

ITA 1987/MUM/2020

AI Insights

The case involves multiple appeals by Galderma India Pvt. Ltd. against the orders of the Income Tax Department concerning disallowances made under various heads such as sales promotion expenses and dividend distribution tax for the assessment years 2013-14, 2014-15, and 2015-16. The primary legal contention revolves around the applicability of the Indian Medical Council Act and the interpretation of expenses as either promotional or educational in nature. The Tribunal examined the arguments presented by both parties, including the relevance of the Apex Laboratories Pvt. Ltd. case, which influenced the decision on whether certain expenses were in violation of public policy and thus not deductible under Section 37(1) of the Income Tax Act.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123547 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: G
• Next Hearing Date: 05-03-2023
• Assessment Year: 2014-2015
• Appeal Filed On: 08-12-2020
• Other Referred Cases: Apex Laboratories Pvt. Ltd. vs. DCIT, CIT vs. KAP Scan & Diagnostic Centre Private Limited, CIT vs. PT Vishwanath Sharma, Hameed vs. Mohd. Ishaq, Venkataraman & Co. (P) Ltd. vs. CIT, Dhannalal vs. Kalawatibai and Ors, Jamali Ahmad vs. Abu Saleh Najmuddin & Anr
• Laws Referred To: Income Tax Act, 1961, Indian Medical Council Act, Medical Council (Amendment) Act, 2003
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift; Business expenditure; Double taxation relief; Set aside
• Section: 37(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “G” MUMBAI BEFORE SHRI ABY T VARKEY (JUDICIAL MEMBER) AND SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) ITA No. 1747/MUM/2019 Assessment Year: 2013-14 & ITA No. 1987/MUM/2020 Assessment Year: 2014-15 & ITA No. 1988/MUM/2020 Assessment Year: 2015-16 Galderma India Pvt. Ltd. (Formerly known as Nestle Skin Health India Pvt. Ltd.), Lotus Corporate Park, D Wing, Unit 801 & 802, Graham Firth Steel Compound, Goregaon (E), Mumbai-400063. Vs. ACIT-9(3)(2), Aayakar Bhavan, M.K. Road, Mumbai-400020. PAN No. AACG 8660 M Appellant Respondent ITA No. 1964/MUM/2020 Assessment Year: 2014-15 & ITA No. 1965/MUM/2020 Assessment Year: 2015-16 ACIT-1(3)(1), Room No. 540, 5 th floor, Aayakar Bhavan, M.K. Road, Mumbai-400020. Vs. M/s Galderma India Pvt. Ltd., (Previously known as M/s Mestle Skin Health India Pvt. Ltd.), Lotus Corporate Park, ‘D’ Wing, Unit 801 & 802, Graham Firth Steel Compound, Goregaon (E), Mumbai-400063. PAN No. AACG 8660 M Appellant Respondent Assessee by Revenue by Date of Hearing Date of pronouncement PER OM PRAKASH KANT, AM These appeals by the assessee and cross Revenue are directed against separate orders each for assessment years 2014 15.02.2019 for assessment year 2013 Commissioner of Income Ld. CIT(A)’]. The grounds being identical, same were heard together and disposed of of this consolidated order for convenience and avoid repetition of facts. 2. Before us, the Ld. Counsel of the assessee proposed that appeal for assessment year 2015 adjudication and result of the on the appeals for assessment year 2014 Departmental Representative (DR) did not object f ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 : Mr. Ronak Doshi, Ms. Ayushi Modani, Ms. Vidhi Salot, ARs : Mr. Kishor Dhule, CIT- Mr. Anil Kumar Das, DR Date of Hearing : 06/03/2023 Date of pronouncement : 30/03/2023 ORDER PER OM PRAKASH KANT, AM appeals by the assessee and cross-appeals by the Revenue are directed against separate orders, dated 27.02.2020 for assessment years 2014-15 and 2015-16 and order dated 15.02.2019 for assessment year 2013-14, passed by the Ld. Income-tax (Appeals)-16, Mumbai [in short ‘the ]. The grounds raised in these appeals and cross appeals same were heard together and disposed of of this consolidated order for convenience and avoid repetition of the Ld. Counsel of the assessee proposed that appeal for assessment year 2015-16 might be taken as lead case for and result of the same to be applied mutatis mutandis on the appeals for assessment year 2014-15 and 2013 Departmental Representative (DR) did not object f Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 2 -DR Mr. Anil Kumar Das, DR appeals by the dated 27.02.2020 16 and order dated 14, passed by the Ld. 16, Mumbai [in short ‘the raised in these appeals and cross appeals same were heard together and disposed off by way of this consolidated order for convenience and avoid repetition of the Ld. Counsel of the assessee proposed that 16 might be taken as lead case for mutatis mutandis 15 and 2013-14. The Ld. Departmental Representative (DR) did not object for the same. Accordingly, firstly, 2015-16 for adjudication. 3. The sole ground raised by the assessee in appeal for assessment year 2015 The Ld. CIT(A) erred in law in disallowing Rs.74,46,247/ from Sales Promotion expenses. 3.1 The ground raised by the Revenue for assessment year 2015 16 is reproduced as under: Whether on the facts and in the circumstances of the case and in law, the Rs.1,80,92,582/ without appreciating that such expenses were incurred in violation of amended India Medical Council Act, in view of the provisions contained in Explanation 1 t of the Act and also in view of the clarifications made by CBDT Circular No. 5/2012 dated 01.08.2012. 4. Briefly stated, facts of the case are that the assessee company during the year under consideration was engaged in the business of marketing & trading is a wholly owned subsidiary Switzerland Company. For the year under consideration, the assessee filed return of income on 27.11.20 income at Rs.35,82,09,750/ assessee was selected for scrutiny and statutory notices under the Income-tax Act, 1961 (in short ‘the Act’) were issued and complied with. During the course of assessment ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 firstly, we took up the appeals for assessment year adjudication. ground raised by the assessee in appeal for assessment year 2015-16 is reproduced as under: The Ld. CIT(A) erred in law in disallowing Rs.74,46,247/ from Sales Promotion expenses. The ground raised by the Revenue for assessment year 2015 reproduced as under: Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs.1,80,92,582/- claimed as sales promotion expense without appreciating that such expenses were incurred in violation of amended India Medical Council Act, in view of the provisions contained in Explanation 1 to section 37(1) of the Act and also in view of the clarifications made by CBDT Circular No. 5/2012 dated 01.08.2012. Briefly stated, facts of the case are that the assessee company during the year under consideration was engaged in the business of ting & trading ‘dermatology’ products. The assessee company is a wholly owned subsidiary of ‘Galderma Pharma SA Switzerland Company. For the year under consideration, the assessee filed return of income on 27.11.2015 declaring total income at Rs.35,82,09,750/-. The return of income filed by the assessee was selected for scrutiny and statutory notices under the tax Act, 1961 (in short ‘the Act’) were issued and complied with. During the course of assessment proceedings, the Assessing Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 3 up the appeals for assessment year ground raised by the assessee in appeal for The Ld. CIT(A) erred in law in disallowing Rs.74,46,247/- The ground raised by the Revenue for assessment year 2015- Whether on the facts and in the circumstances of the case Ld. CIT(A) erred in deleting the addition of claimed as sales promotion expense without appreciating that such expenses were incurred in violation of amended India Medical Council Act, in view of o section 37(1) of the Act and also in view of the clarifications made by Briefly stated, facts of the case are that the assessee company during the year under consideration was engaged in the business of products. The assessee company Galderma Pharma SA’, a Switzerland Company. For the year under consideration, the 15 declaring total . The return of income filed by the assessee was selected for scrutiny and statutory notices under the tax Act, 1961 (in short ‘the Act’) were issued and complied oceedings, the Assessing Officer (AO) observed payments to the doctors and their professional associations, which according to him were inviolation of Medical Council of India Regulation and CBDT Circular No. 5/2 of the total expenses of Rs.15,34,05,440/ ‘sales promotion and marketing expenses, t disallowed expenses to the under: “The learned AR of the asse of the above expenses have been incurred on medical practitioners / their professional associations. Before dealing with the submission of the assessee that the said Circular is not applicable to the aforesaid expenditure, it is significant to identify the expenses, attracting the applicability of Circular No.05/2012 dated 01.08.2012. Having regard to the facts that the assessee has deducted tax at source in respect of certain expenses and also some of the expenditure has been i relation to the employees / officers / field force of the assessee company, the following expenses, which are found to have nexus with the payments made to doctors / their professional associations, are hereby identified for the purpose of makin Section 37(1) of the Act; Category P.G. Grant Doctors Group meeting Post marketing survey (PMS) ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 observed expenses incurred by the assessee to the doctors and their professional associations, which according to him were inviolation of Medical Council of India Regulation and CBDT Circular No. 5/2012 dated 01.08.2012. Out of the total expenses of Rs.15,34,05,440/- debited under the head romotion and marketing expenses, the Assessing Officer disallowed expenses to the extent of Rs.2,55,38,829/ The learned AR of the assessee has submitted that none of the above expenses have been incurred on medical practitioners / their professional associations. Before dealing with the submission of the assessee that the said Circular is not applicable to the aforesaid expenditure, it s significant to identify the expenses, attracting the applicability of Circular No.05/2012 dated 01.08.2012. Having regard to the facts that the assessee has deducted tax at source in respect of certain expenses and also some of the expenditure has been incurred in relation to the employees / officers / field force of the assessee company, the following expenses, which are found to have nexus with the payments made to doctors / their professional associations, are hereby identified for the purpose of making disallowance under Explanation to Section 37(1) of the Act; Amount (Rs.) Nature of expense 7,00,000 It is incurred to provide a fixed grant to PG students presenting posters at the National Conference. It is not a business related ac Thus it comes within the mischief of the IMC Regulations. 15,55,340 It is incurred to fund the educational programs in the field of dermatology. This expenditure comes within the mischief of the IMC Regulations. 29,34,000 It is incurred for documenting the feedback obtained from registered medical practitioners. Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 4 incurred by the assessee for to the doctors and their professional associations, which according to him were inviolation of Medical Council of India (MCI) 012 dated 01.08.2012. Out debited under the head he Assessing Officer Rs.2,55,38,829/- observing as ssee has submitted that none of the above expenses have been incurred on medical practitioners / their professional associations. Before dealing with the submission of the assessee that the said Circular is not applicable to the aforesaid expenditure, it s significant to identify the expenses, attracting the applicability of Circular No.05/2012 dated 01.08.2012. Having regard to the facts that the assessee has deducted tax at source in respect of certain expenses and ncurred in relation to the employees / officers / field force of the assessee company, the following expenses, which are found to have nexus with the payments made to doctors / their professional associations, are hereby identified for g disallowance under Explanation to Nature of expense It is incurred to provide a fixed grant to PG students presenting posters at the National Conference. It is not a business related activity. Thus it comes within the mischief of the IMC It is incurred to fund the educational programs in the field of dermatology. This expenditure comes within the mischief of the IMC It is incurred for documenting the feedback obtained from registered medical practitioners. IADVL Stata IADVL Other conference Sponsorship local Samples Thus, as regards the expenditure of Rs. 2,55,38,829/ claimed under the name and style of"sales promotion expenses, the same is hereby held to have been incurred directly or indirectly to appease the doctors and their professional associations by way of giving away the freebies. which is against the public policy and prohibited by law, and hence the plea raised by the AR of the assessee that it is not required to be disallo Explanation to Section 3711 of the Act, is found to be not acceptable in view of the followi therefore;” 5. The Ld. Assessing Officer supported the finding relying on the decision of the Hon’ble Allahabad High Court in the c Hameed v. Mohd. Ishaq [AIR 1975 All. 166] ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 Thus, this expenditure comes within the mischief of the IMC regulations. 26,05,970 15,67,771 30,79,341 It is the payment made to medical practitioners/their professional association for attending the congress and stall participation. This expenditure comes within the mischief of the IMC Regulations. 22,56,907 The sum of Rs.22,56,907/ on purchase of test kits/instruments, which are given to the Doctors. Thus, this expenditure comes within the mischief of the IMC Regulations. 2,16,78,999 The expenditure of Rs. 2,16,78,999/ isincurred on manufacture of samples of the company's products, and dispatch on them which are given to medical practitioners. As per the assessee, it has incurred this expenditure towards the samples as givento the 600stockists and the medical practitioners.However , the assessee plea is not acceptable in view of the fact that the assessee has not been able to exactly quantify the amount of such samples distributed to its stockists or Medical practitioners. Hence, considering the written submission of the assessee, the disallowance is restricted to the 50% of the samples cost ie Rs. 1,08,39,500/ Thus, as regards the expenditure of Rs. 2,55,38,829/ claimed under the name and style of"sales promotion expenses, the same is hereby held to have been incurred or indirectly to appease the doctors and their professional associations by way of giving away the freebies. which is against the public policy and prohibited by law, and hence the plea raised by the AR of the assessee that it is not required to be disallowed as per Explanation to Section 3711 of the Act, is found to be not acceptable in view of the following detailed reasoning The Ld. Assessing Officer supported the finding relying on the decision of the Hon’ble Allahabad High Court in the c Hameed v. Mohd. Ishaq [AIR 1975 All. 166], to explain the term Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 5 Thus, this expenditure comes within the mischief of the IMC regulations. It is the payment made to medical practitioners/their professional association for attending the congress and stall participation. This expenditure comes within the mischief of The sum of Rs.22,56,907/- has been incurred on purchase of test kits/instruments, which are given to the Doctors. Thus, this expenditure comes within the mischief of the IMC The expenditure of Rs. 2,16,78,999/- d on manufacture of samples of the company's products, and dispatch on them which are given to medical practitioners. As per the assessee, it has incurred this expenditure towards the samples as givento the 600stockists and the medical r , the assessee plea is not acceptable in view of the fact that the assessee has not been able to exactly quantify the amount of such samples distributed to its stockists or Medical practitioners. Hence, considering the written submission of the the disallowance is restricted to the 50% of the samples cost ie Rs. 1,08,39,500/- Thus, as regards the expenditure of Rs. 2,55,38,829/- claimed under the name and style of"sales promotion expenses, the same is hereby held to have been incurred or indirectly to appease the doctors and their professional associations by way of giving away the freebies. which is against the public policy and prohibited by law, and hence the plea raised by the AR of the wed as per Explanation to Section 3711 of the Act, is found to be not ng detailed reasoning The Ld. Assessing Officer supported the finding relying on the decision of the Hon’ble Allahabad High Court in the case of Abdul , to explain the term “prohibited by law”. He further relied on the decision of Punjab & Haryana High Court in the case of CIT v. KAP Scan & Diagnostic Centre Private Limited [2012] 344 ITR 476 support that paying commission to private doctors i against public policy and forbidden by law and therefore, same was not allowable being prohibited by Regulation 6.4.1 and 6.4.2 of the MCI Regulations. 6. On further appeal, the Ld. CIT(A) predecessor partly allowed the appeal in favour of the assessee. Out of the total expenses disallowed by the Assessing Officer, the Ld. CIT(A) upheld the disallowance of Rs.1,98,47,412/ certain expenses observing “5.1.6 During appellate proceedings, the Ld. A.R. admitted that expenses claimed against continued Medical education Rs.12,30,833/ Doctor Group Meeting Survey PMS Rs. 41,67,000, Sponsorship Local 27,70,809/- doctors - Rs.2,62,963/ incurred directly or indirectly on doctors or their associations and no arguments were regarding disallowance of the same made by the AO.As mentioned by the AO in the assessment order, these payments were made in contravention to Explanation (1) to Section 371(1) of the Income Tax Act. There is a clear cut violation of Indian Cou by the Parliament. The Hon'ble High Court of Allahabad has considered the similar issue in the case of CIT vs, PT Vishwanath Sharma (2009) 316 ITR 0419. ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 . He further relied on the decision of Punjab & Haryana High Court in the case of CIT v. KAP Scan & Diagnostic Centre Private Limited [2012] 344 ITR 476 support that paying commission to private doctors i against public policy and forbidden by law and therefore, same was not allowable being prohibited by Regulation 6.4.1 and 6.4.2 of the On further appeal, the Ld. CIT(A) following the finding of his predecessor partly allowed the appeal in favour of the assessee. Out of the total expenses disallowed by the Assessing Officer, the Ld. the disallowance of Rs.1,98,47,412/ certain expenses observing as under: 5.1.6 During appellate proceedings, the Ld. A.R. admitted that expenses claimed against continued Medical education - Rs. 2,70,520/- , P. G. Grant Rs.12,30,833/-Indian Acne Alliance -Rs. 5,61,172/ Doctor Group Meeting - Rs. 11,54,265/- Post Marketing Survey PMS Rs. 41,67,000, Sponsorship Local Samples- Rs. 94,29,850/- and payments to Rs.2,62,963/- totalling Rs. 1,98,47,412/ incurred directly or indirectly on doctors or their associations and no arguments were put forward regarding disallowance of the same made by the AO.As mentioned by the AO in the assessment order, these payments were made in contravention to Explanation (1) to Section 371(1) of the Income Tax Act. There is a clear cut violation of Indian Council Act, a law of land passed by the Parliament. The Hon'ble High Court of Allahabad has considered the similar issue in the case of CIT vs, PT Vishwanath Sharma (2009) 316 ITR 0419.” Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 6 . He further relied on the decision of Hon’ble Punjab & Haryana High Court in the case of CIT v. KAP Scan & Diagnostic Centre Private Limited [2012] 344 ITR 476 to support that paying commission to private doctors is unethical, against public policy and forbidden by law and therefore, same was not allowable being prohibited by Regulation 6.4.1 and 6.4.2 of the following the finding of his predecessor partly allowed the appeal in favour of the assessee. Out of the total expenses disallowed by the Assessing Officer, the Ld. the disallowance of Rs.1,98,47,412/- in respect of 5.1.6 During appellate proceedings, the Ld. A.R. admitted that expenses claimed against continued , P. G. Grant - Rs. 5,61,172/- Marketing Survey PMS Rs. 41,67,000, Sponsorship Local - Rs. and payments to totalling Rs. 1,98,47,412/-were incurred directly or indirectly on doctors or their put forward regarding disallowance of the same made by the AO.As mentioned by the AO in the assessment order, these payments were made in contravention to Explanation (1) to Section 371(1) of the Income Tax Act. There is a clear ncil Act, a law of land passed by the Parliament. The Hon'ble High Court of Allahabad has considered the similar issue in the case of CIT vs, PT 6.1 In respect of other expenses like IADVL by the Ld. CIT(A) allowed relief to the assessee “5.1.9 In respect to payment made to IADVL New year Rs. 31,12,488/ Rs. 14,86,618/ assessee company claimed tota 97,93,996/-, According to the appellant, these payments were made with an intention to attend congress & put a stall at the venue of congress. For promoting marketing of its product, the assessee company installed a stall where products of the company were put for exhibition and sale. According to the appellant, Indian Association of Dermatologists, is one of the largest dermatologic association in the world. Participating in it and just to having a stall at the meetings organised by such association, Have a boosting impact on its sales and advertisement of its products. Seminar are organized by the IADVL & large number of doctors and specialists participate in it. Therefore, having a stall a participation in the congress is very useful in advertising the products of the assessee company. It was once again reiterated that the expense were exclusively incurred for installation of stall and fixed fee payment required for participation. It was clarified that expenses mentioned aga other conference, were not incurred on organisation of seminars or giving free gifts, accommodation to doctors or any other favours to doctors. Necessary bills and vouchers relating to above mentioned expenses were produced during course of appellate proceedings. These expenses incurred were exclusively for participation fee and installation of stall which are not prohibited by the Indian Medical Council Act. Therefore, provisions of Explanation respect to payments of Rs. 97,93,996/ the facts of the case, expenditure for an amount of Rs.97,93,996/ stall and participation fees are allowed and expenses of Rs.1,98,47,412/ ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 In respect of other expenses like IADVL &other conference etc. allowed relief to the assessee observing as under: 5.1.9 In respect to payment made to IADVL New year Rs. 31,12,488/- IADVL-Rs. 27,62,350/-, State IADVL Rs. 14,86,618/- other conference - Rs. 24,32,510/ assessee company claimed total expenses of Rs. , According to the appellant, these payments were made with an intention to attend congress & put a stall at the venue of congress. For promoting marketing of its product, the assessee company installed a stall where f the company were put for exhibition and sale. According to the appellant, Indian Association of Dermatologists, is one of the largest dermatologic association in the world. Participating in it and just to having a stall at the meetings organised by such association, Have a boosting impact on its sales and advertisement of its products. Seminar are organized by the IADVL & large number of doctors and specialists participate in it. Therefore, having a stall a participation in the congress is very useful in promoting and advertising the products of the assessee company. It was once again reiterated that the expense were exclusively incurred for installation of stall and fixed fee payment required for participation. It was clarified that expenses mentioned against IADVL New year, IADVL, State IADVL, other conference, were not incurred on organisation of seminars or giving free gifts, accommodation to doctors or any other favours to doctors. Necessary bills and vouchers relating to above mentioned expenses were produced during course of appellate proceedings. These expenses incurred were exclusively for participation fee and installation of stall which are not prohibited by the Indian Medical Council Act. Therefore, provisions of Explanation - I to Section 37(1) will not be applicable in respect to payments of Rs. 97,93,996/-. Keeping in view the facts of the case, expenditure for an amount of Rs.97,93,996/- incurred in connection with installation of stall and participation fees are allowed and expenses of s.1,98,47,412/- incurred for giving various direct and Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 7 other conference etc. observing as under: 5.1.9 In respect to payment made to IADVL New year - , State IADVL - Rs. 24,32,510/- the l expenses of Rs. , According to the appellant, these payments were made with an intention to attend congress & put a stall at the venue of congress. For promoting marketing of its product, the assessee company installed a stall where f the company were put for exhibition and sale. According to the appellant, Indian Association of Dermatologists, is one of the largest dermatologic association in the world. Participating in it and just to having a stall at the meetings organised by such association, Have a boosting impact on its sales and advertisement of its products. Seminar are organized by the IADVL & large number of doctors and specialists participate in it. Therefore, having a stall a participation promoting and advertising the products of the assessee company. It was once again reiterated that the expense were exclusively incurred for installation of stall and fixed fee payment required for participation. It was clarified that expenses inst IADVL New year, IADVL, State IADVL, other conference, were not incurred on organisation of seminars or giving free gifts, accommodation to doctors or any other favours to doctors. Necessary bills and vouchers relating to above mentioned expenses were also produced during course of appellate proceedings. These expenses incurred were exclusively for participation fee and installation of stall which are not prohibited by the Indian Medical Council Act. Therefore, provisions of 7(1) will not be applicable in . Keeping in view the facts of the case, expenditure for an amount of incurred in connection with installation of stall and participation fees are allowed and expenses of incurred for giving various direct and indirect favours to doctors and their associations were not allowed us. 37(1) of the Income Tax Act, 1961 5.1.10In respect to P.G. Grant of Rs.7,00,000/ group meetings Rs.15,55,340/ Rs. 29,34,000/ the facts and submissions are same and I have no reason to deviate from order dated in appellant's own case. Therefore, disallowance of Rs.74,46,247 made by the A.O. is hereby has allowed paymentsmade to IADVL Rs. 26,05,970/ State IADVL Rs. 15,67,771/ Rs.30,79,341/ similar to A.Y.2011 expenses with an int stall at the venue of congress. Therefore, as decided in appellant's own case for A. Y.2011 are allowed. The A.O. is directed to delete the addition of Rs.72,53,082/ 6.2 In respect of expenses on account of the Ld. CIT(A) allowed the expenditure observing as under: “5.1.11 Expenses of Rs.69,79,140/ samples to doctors was confirmed by the Ld. CIT(A) Mumbai in A.Y. 2011 arguments were made by the appellant regarding the allowability of these expenses.However, during appellate proceedings, in the instant case, the appellant has relied upon the judgements of Hon'ble ITAT 'D*** Bench Mumbai in the case of Dup No.5195/Mum/2013 . The above mentioned judgement is received after appellate order dated 18.12.2015 in the appellant's own case. The issue before the Hon'ble Bench was whether the expenditure incurred on account of free sample distribu allowable or not. After considering the arguments of the appellant and respondent, the Hon'ble Tribunal on the ground raised has held as under: ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 indirect favours to doctors and their associations were not allowed us. 37(1) of the Income Tax Act, 1961. 5.1.10In respect to P.G. Grant of Rs.7,00,000/- group meetings Rs.15,55,340/-, Post marketing survey Rs. 29,34,000/-/ and Sponsorship local Rs.22,56,907 / the facts and submissions are same and I have no reason to deviate from order dated in appellant's own case. Therefore, disallowance of Rs.74,46,247 made by the A.O. is hereby confirmed. Similarly my predecessor has allowed paymentsmade to IADVL Rs. 26,05,970/ State IADVL Rs. 15,67,771/-, Other conference Rs.30,79,341/- in respect of these expenses facts are similar to A.Y.2011-12 . The appellant has incurred these expenses with an intention to attend congress and put a stall at the venue of congress. Therefore, as decided in appellant's own case for A. Y.2011-12 these expenses are allowed. The A.O. is directed to delete the addition of Rs.72,53,082/- made by the A.O.” expenses on account of ‘free samples CIT(A) allowed the expenditure observing as under: 5.1.11 Expenses of Rs.69,79,140/- on account of free samples to doctors was confirmed by the Ld. CIT(A) Mumbai in A.Y. 2011-12. At that time, no specific arguments were made by the appellant regarding the allowability of these expenses.However, during appellate proceedings, in the instant case, the appellant has relied upon the judgements of Hon'ble ITAT 'D*** Bench Mumbai in the case of Dupen Laboratories IT A No.5195/Mum/2013 . The above mentioned judgement is received after appellate order dated 18.12.2015 in the appellant's own case. The issue before the Hon'ble Bench was whether the expenditure incurred on account of free sample distribution of medicines to physicians is allowable or not. After considering the arguments of the appellant and respondent, the Hon'ble Tribunal on the ground raised has held as under: Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 8 indirect favours to doctors and their associations were . Doctors rketing survey / and Sponsorship local Rs.22,56,907 /-, the facts and submissions are same and I have no reason to deviate from order dated in appellant's own case. Therefore, disallowance of Rs.74,46,247 made by Similarly my predecessor has allowed paymentsmade to IADVL Rs. 26,05,970/-, , Other conference in respect of these expenses facts are 12 . The appellant has incurred these ention to attend congress and put a stall at the venue of congress. Therefore, as decided in 12 these expenses are allowed. The A.O. is directed to delete the addition of free samples’ to doctors, CIT(A) allowed the expenditure observing as under: on account of free samples to doctors was confirmed by the Ld. CIT(A) - 16, me, no specific arguments were made by the appellant regarding the allowability of these expenses.However, during appellate proceedings, in the instant case, the appellant has relied upon the judgements of Hon'ble ITAT 'D*** Bench Mumbai en Laboratories IT A No.5195/Mum/2013 . The above mentioned judgement is received after appellate order dated 18.12.2015 in the appellant's own case. The issue before the Hon'ble Bench was whether the expenditure incurred on account of free tion of medicines to physicians is allowable or not. After considering the arguments of the appellant and respondent, the Hon'ble Tribunal on the "Therefore, it is observed that the expenditure incurred for providing the sa free of cost to the medical practitioners is liable to be allowed as business expenditure, and therefore, the order of the learned CIT(A) is hereby set aside in this regards and the file is hereby order to restore before Assessing Office assessment of assessee in view of the above said observations". 7. Aggrieved with the above finding of the Ld. CIT(A) both the assessee and the Revenue are in appeal before the Tribunal by way of raising grounds as reproduced above. 8. Before us, the Ld. Counsel of the assessee has filed a Paper Book in two volumes containing pages 1 to 96 and 97 to 149. Ld. Counsel also filed a compilation of case laws in support of ground raised. 8.1 The Ld. Counsel of the assessee before us submitt firstly, as far as violation of M relevant authority has not held the assessee as guilty for violation of the said regulations and therefore in the case of the assessee is no finding from the relevant authorities regulating the MCI Regulations that the expenditure incurred by the assessee are in violation of law or prohibited under the relevant law. The Ld. Counsel submitted that in the case of v. DCIT [2022] 135 taxmann.com 286 (SC) Regulationswas not dispute ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 Therefore, it is observed that the expenditure incurred for providing the samples of medicines free of cost to the medical practitioners is liable to be allowed as business expenditure, and therefore, the order of the learned CIT(A) is hereby set aside in this regards and the file is hereby order to restore before Assessing Officer to reassess the assessment of assessee in view of the above said observations".” Aggrieved with the above finding of the Ld. CIT(A) both the assessee and the Revenue are in appeal before the Tribunal by way of raising grounds as reproduced above. Before us, the Ld. Counsel of the assessee has filed a Paper Book in two volumes containing pages 1 to 96 and 97 to 149. Ld. Counsel also filed a compilation of case laws in support of Ld. Counsel of the assessee before us submitt as far as violation of MCI Regulations is concerned,t relevant authority has not held the assessee as guilty for violation of the said regulations and therefore in the case of the assessee finding from the relevant authorities regulating the MCI Regulations that the expenditure incurred by the assessee are in violation of law or prohibited under the relevant law. The Ld. Counsel submitted that in the case of Apex Laboratories (P.) Ltd. IT [2022] 135 taxmann.com 286 (SC), violation of the MCI not disputed in said case, as against Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 9 Therefore, it is observed that the expenditure mples of medicines free of cost to the medical practitioners is liable to be allowed as business expenditure, and therefore, the order of the learned CIT(A) is hereby set aside in this regards and the file is hereby order to r to reassess the assessment of assessee in view of the above said Aggrieved with the above finding of the Ld. CIT(A) both the assessee and the Revenue are in appeal before the Tribunal by way Before us, the Ld. Counsel of the assessee has filed a Paper Book in two volumes containing pages 1 to 96 and 97 to 149.The Ld. Counsel also filed a compilation of case laws in support of Ld. Counsel of the assessee before us submitted that is concerned,the relevant authority has not held the assessee as guilty for violation of the said regulations and therefore in the case of the assessee, there finding from the relevant authorities regulating the MCI Regulations that the expenditure incurred by the assessee are in violation of law or prohibited under the relevant law. The Ld. Apex Laboratories (P.) Ltd. violation of the MCI as against the same is disputed by the assessee in the instant the said decision cannot be applied over case. Secondly, without prejudice to the first argument, the Ld. Counsel of the assessee submitted that the expenses incurred were for the purpose of the business and not in violation of any law and therefore, all the expenses which were disallowed by the Officer are eligible u/s 37(1) of the Act. Regarding the disallowance of the free samples, the Ld. Counsel relied on the decision of the Tribunal in the case of 1525/Mum/2016) (Mum. Trib.) passed after considering the ratio of Apex Laboratories Pvt. Ltd. (supra). Regarding other expenses also that payments for tho practitioner and therefore same Regulations. 9. The Ld. DR on the other hand, relied on the order of the Ld. Assessing Officer and submitted that the expenses incurred being against the public policy and which have been held by the Hon’ble Supreme Court in the in violation of law or prohibition of the law eligible u/s 37(1) of the Act. 10. We have heard rival submission of the parties on the issue dispute and perused the relevant material ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 disputed by the assessee in the instant case, therefore,t the said decision cannot be applied over the facts of the instant , without prejudice to the first argument, the Ld. Counsel of the assessee submitted that the expenses incurred were for the purpose of the business and not in violation of any law and therefore, all the expenses which were disallowed by the u/s 37(1) of the Act. Regarding the disallowance of the free samples, the Ld. Counsel relied on the decision of the Tribunal in the case of M/s Merk Limited v. DCIT (ITA No. 1525/Mum/2016) (Mum. Trib.), which according to hi passed after considering the ratio of Apex Laboratories Pvt. Ltd. (supra). Regarding other expenses also, the Ld. Counsel submitted ose expenses had not been made to the medical practitioner and therefore same were not falling under the MCI The Ld. DR on the other hand, relied on the order of the Ld. Assessing Officer and submitted that the expenses incurred being against the public policy and which have been held by the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra) in violation of law or prohibition of the law, therefore, same are not u/s 37(1) of the Act. We have heard rival submission of the parties on the issue dispute and perused the relevant material on record. We find that Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 10 case, therefore,the ratio of the facts of the instant , without prejudice to the first argument, the Ld. Counsel of the assessee submitted that the expenses incurred were for the purpose of the business and not in violation of any law and therefore, all the expenses which were disallowed by the Assessing u/s 37(1) of the Act. Regarding the disallowance of the free samples, the Ld. Counsel relied on the decision of the M/s Merk Limited v. DCIT (ITA No. which according to him has been passed after considering the ratio of Apex Laboratories Pvt. Ltd. the Ld. Counsel submitted not been made to the medical not falling under the MCI The Ld. DR on the other hand, relied on the order of the Ld. Assessing Officer and submitted that the expenses incurred being against the public policy and which have been held by the Hon’ble Apex Laboratories Pvt. Ltd. (supra), therefore, same are not We have heard rival submission of the parties on the issue-in- on record. We find that prior to the decision of the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra) promotion and advertisement incurred in the form of doctors (ii) group meeting based conferences and (iv) in assessment year 2011 Department against which is pending before the Hon’ble High Court. In earlier years, the Tribunal on the ground that CBDT Circular No. 5/2012 was to be applied prospectively and not retrospectively and further MCI regulations were applicable on the medical practitioners and were not applicable to the pharmaceutical compan Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra) after considering the arguments from both sides held that expenses incurred for promotion of pharmaceutical products in the form of gifts or incentives (free policy and being prohibited by law 37(1) of the Act. The relevant finding of the Hon’ble Supreme Court (supra) is reproduced as under: “24. Even if Apex’s contention were to be accepted it did not indulge in any illegal activity by committing an offence, as there was no corresponding in the 2002 Regulations applicable to it doubt that its actions fell within the purview of “prohibited by law” in Explanat ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 prior to the decision of the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra), the expenditure on sales promotion and advertisement incurred in the form of group meeting based survey sponsoring (iii) and (iv) free samples etc. were allowed by the Tribunal in assessment year 2011-12 and 2012-13 and appeal of the Department against which is pending before the Hon’ble High Court. In earlier years, the Tribunal has allowed the appeal mainly on the ground that CBDT Circular No. 5/2012 was to be applied prospectively and not retrospectively and further MCI regulations applicable on the medical practitioners and were not applicable to the pharmaceutical companies. But we find that the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. after considering the arguments from both sides held that expenses incurred for promotion of pharmaceutical products in the form of gifts or incentives (freebies) to the doctors are policy and being prohibited by law, same are not allowable u/s 37(1) of the Act. The relevant finding of the Hon’ble Supreme Court is reproduced as under: 24. Even if Apex’s contention were to be accepted it did not indulge in any illegal activity by committing an offence, as there was no corresponding penal provision in the 2002 Regulations applicable to it - there is no doubt that its actions fell within the purview of “prohibited by law” in Explanation 1 to Section 37(1) Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 11 prior to the decision of the Hon’ble Supreme Court in the case of the expenditure on sales promotion and advertisement incurred in the form of (i) PG grant to (iii) IADVL other free samples etc. were allowed by the Tribunal 13 and appeal of the Department against which is pending before the Hon’ble High has allowed the appeal mainly on the ground that CBDT Circular No. 5/2012 was to be applied prospectively and not retrospectively and further MCI regulations applicable on the medical practitioners and were not ies. But we find that the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. after considering the arguments from both sides held that expenses incurred for promotion of pharmaceutical products in the are against public not allowable u/s 37(1) of the Act. The relevant finding of the Hon’ble Supreme Court 24. Even if Apex’s contention were to be accepted - that it did not indulge in any illegal activity by committing an penal provision there is no doubt that its actions fell within the purview of Section 37(1). 25. Furthermore, if the statutory limitations imposed by the 2002 Regulations are kept in mind, Explanation (1) to Section 37(1) of Section 20A (which serves as parent provision for the regulations), what is discernible is that the statutory regime requiring that a thing be done in a certain manner, also implies (even in the absence of any express terms), that the other forms of doing it are impermissible. 26. In this regard the decision of this Court in Uddin Ahmad v. Abu Saleh Najmuddin & Anr24 some relevance. There, the scope of Representation of the People Act, 1951 was examined in the light of powers of the High Court to adminis election petitions by invoking the rule of implied prohibition. The Court observed that: “Dealing with "Statutes conferring power; implied conditions, judicial review", Justice G.P. Singh states in the Principles of Statutory Interpretation (Eight Edit 2001, at pp. 333, 334) that a power conferred by a statute often contains express conditions for its exercise and in the absence of or in addition to the express conditions there are also implied conditions for exercise of the power. An affirmative sta law directing a thing to be done in a certain way mandates, even if there be no negative words, that the thing shall not be done in any other way. This rule of implied prohibition is subserved to the basic principle that the Cour construction which effectuates the legislative intent and purpose. Further, the rule of implied prohibition does not negative the principle that an express grant of statutory power carries with it by necessary implicati authority to use all reasonable means to make such grant effective. To illustrate, an Act of Parliament conferring jurisdiction over an offence implies a power in that jurisdiction to make out a warrant and secure production of the person charged wi on Magistrate to grant maintenance under 125 of the Code of Criminal Procedure 1973 to prevent ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 25. Furthermore, if the statutory limitations imposed by the 2002 Regulations are kept in mind, Explanation (1) Section 37(1) of the IT Act and the insertion Section 20A of the Medical Council Act, 195623 (which serves as parent provision for the regulations), what is discernible is that the statutory regime requiring a thing be done in a certain manner, also implies (even in the absence of any express terms), that the other forms of doing it are impermissible. 26. In this regard the decision of this Court in in Ahmad v. Abu Saleh Najmuddin & Anr24 some relevance. There, the scope of Section 81 Representation of the People Act, 1951 was examined in the light of powers of the High Court to adminis election petitions by invoking the rule of implied prohibition. The Court observed that: “Dealing with "Statutes conferring power; implied conditions, judicial review", Justice G.P. Singh states in the Principles of Statutory Interpretation (Eight Edit 2001, at pp. 333, 334) that a power conferred by a statute often contains express conditions for its exercise and in the absence of or in addition to the express conditions there are also implied conditions for exercise of the power. An affirmative statute introductive of a new law directing a thing to be done in a certain way mandates, even if there be no negative words, that the thing shall not be done in any other way. This rule of implied prohibition is subserved to the basic principle that the Court must, as far as possible, attach a construction which effectuates the legislative intent and purpose. Further, the rule of implied prohibition does not negative the principle that an express grant of statutory power carries with it by necessary implicati authority to use all reasonable means to make such grant effective. To illustrate, an Act of Parliament conferring jurisdiction over an offence implies a power in that jurisdiction to make out a warrant and secure production of the person charged with the offence; power conferred on Magistrate to grant maintenance under of the Code of Criminal Procedure 1973 to prevent Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 12 25. Furthermore, if the statutory limitations imposed by the 2002 Regulations are kept in mind, Explanation (1) of the IT Act and the insertion of the Medical Council Act, 195623 (which serves as parent provision for the regulations), what is discernible is that the statutory regime requiring a thing be done in a certain manner, also implies (even in the absence of any express terms), that the other 26. In this regard the decision of this Court in Jamal in Ahmad v. Abu Saleh Najmuddin & Anr24 is of Section 81 of the Representation of the People Act, 1951 was examined in the light of powers of the High Court to administer election petitions by invoking the rule of implied “Dealing with "Statutes conferring power; implied conditions, judicial review", Justice G.P. Singh states in the Principles of Statutory Interpretation (Eight Edition 2001, at pp. 333, 334) that a power conferred by a statute often contains express conditions for its exercise and in the absence of or in addition to the express conditions there are also implied conditions for exercise of tute introductive of a new law directing a thing to be done in a certain way mandates, even if there be no negative words, that the thing shall not be done in any other way. This rule of implied prohibition is subserved to the basic principle t must, as far as possible, attach a construction which effectuates the legislative intent and purpose. Further, the rule of implied prohibition does not negative the principle that an express grant of statutory power carries with it by necessary implication the authority to use all reasonable means to make such grant effective. To illustrate, an Act of Parliament conferring jurisdiction over an offence implies a power in that jurisdiction to make out a warrant and secure production th the offence; power conferred Section of the Code of Criminal Procedure 1973 to prevent vagrancy implies a power to allow interim maintenance; power conferre holding 'hats' or fairs implies incidental power to fix days therefore; power conferred to compel cane growers to Inserted vide 1964. (2003) 4 SCC 257. supply cane to sugar factories implies an incidental power to ensure payment of price. In short, conferment of a power implies authority to do everything which could be fairly and reasonably regarded as incidental or consequential *** Herbert Broom states in the preface to his celebrated work on Legal Maxims more frequently than in any other, reference must be made to first principles." The fundamentals or the first principles of law often articulated as the maxims are manifestly founded in reason, public convenience and necessity. Modern trend of introducing subtleties and distinctions, both in legal reasoning and in the application of legal principles, formerly unknown, have rendered an accurate acquaintance with the first principles more necessary rather than diminishing the values of simple fundamental rules. The fundamental rules are the basis of the law; may be either directly applied, or qualified or limited, according t exigencies of the particular case and the novelty of the circumstances which present themselves. vs. Kalawatibai and Ors "When the statute does not provide th precedents abstain to lead, then sound logic, rational reasoning, common sense and urge for public good play as guides of those who decide".” 27. It is also a settled principle of law that no court will lend its aid to a party that roots its cause of action in an immoral or illegal act (ex dolo malo non oritur action) meaning that none should be allowed to profit from any ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 vagrancy implies a power to allow interim maintenance; power conferred on a local authority to issue licences for holding 'hats' or fairs implies incidental power to fix days therefore; power conferred to compel cane growers Inserted vide Medical Council (Amendment) Act (2003) 4 SCC 257. supply cane to sugar factories implies an incidental power to ensure payment of price. In short, conferment of a power implies authority to do everything which could be fairly and reasonably regarded as incidental or consequential to the power conferred. *** Herbert Broom states in the preface to his celebrated work on Legal Maxims --"In the Legal Science, perhaps more frequently than in any other, reference must be made to first principles." The fundamentals or the first s of law often articulated as the maxims are manifestly founded in reason, public convenience and necessity. Modern trend of introducing subtleties and distinctions, both in legal reasoning and in the application of legal principles, formerly unknown, have rendered an accurate acquaintance with the first principles more necessary rather than diminishing the values of simple fundamental rules. The fundamental rules are the basis of the law; may be either directly applied, or qualified or limited, according t exigencies of the particular case and the novelty of the circumstances which present themselves. In Dhannalal vs. Kalawatibai and Ors.25 this court has held that: "When the statute does not provide the path and the precedents abstain to lead, then sound logic, rational reasoning, common sense and urge for public good play as guides of those who decide".” 27. It is also a settled principle of law that no court will lend its aid to a party that roots its cause of action in an immoral or illegal act (ex dolo malo non oritur action) meaning that none should be allowed to profit from any Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 13 vagrancy implies a power to allow interim maintenance; d on a local authority to issue licences for holding 'hats' or fairs implies incidental power to fix days therefore; power conferred to compel cane growers Medical Council (Amendment) Act, supply cane to sugar factories implies an incidental power to ensure payment of price. In short, conferment of a power implies authority to do everything which could be fairly and reasonably regarded as incidental or *** Herbert Broom states in the preface to his celebrated "In the Legal Science, perhaps more frequently than in any other, reference must be made to first principles." The fundamentals or the first s of law often articulated as the maxims are manifestly founded in reason, public convenience and necessity. Modern trend of introducing subtleties and distinctions, both in legal reasoning and in the application of legal principles, formerly unknown, have rendered an accurate acquaintance with the first principles more necessary rather than diminishing the values of simple fundamental rules. The fundamental rules are the basis of the law; may be either directly applied, or qualified or limited, according to the exigencies of the particular case and the novelty of the In Dhannalal .25 this court has held that: e path and the precedents abstain to lead, then sound logic, rational reasoning, common sense and urge for public good play 27. It is also a settled principle of law that no court will lend its aid to a party that roots its cause of action in an immoral or illegal act (ex dolo malo non oritur action) meaning that none should be allowed to profit from any wrongdoing coupled with should be coherent and not self pharmacists being complementary and supplementary to each other in the medical profession, a comprehensive view must be adopted to regulate their conduct in view of the contemporary statutory regimes and regulations. Therefore, denial of the tax benefit cannot be construed as penalizing the assessee pharmaceutical company. Only its participation in what is plainly an action prohibited by law, precludes the assessee from it as a deductible expenditure. 28. This Court also notices that medical practitioners have a quasi doctor’s prescription is considered the final word on the medication to be availed by the patient, e such (2002) 6 SCC 16. medication is unaffordable or barely within the economic reach of the patient doctors. Therefore, it is a matter of great public importance and concern, when it is demonstrate doctor’s prescription can be manipulated, and driven by the motive to avail the freebies offered to them by pharmaceutical companies, ranging from gifts such as gold coins, fridges and LCD TVs to funding international trips for vacations or to att These freebies are technically not ‘free’ supplying such freebies is usually factored into the drug, driving prices up, thus creating a perpetual publicly injurious cycle. The threat of prescribing medication that is significantly marked up, over effective generic counterparts in lieu of such a quid pro quo exchange was taken cognizance of by the Parliamentary Standing Committee on Health and Family Welfare26 which made the following observations: “The Committee also n code of ethics in the Indian Medical Council Rules introduced in December 2009 forbidding doctors from accepting any gift, hospitality, trips to foreign and domestic destinations etc from healthcare industry, there ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 wrongdoing coupled with the fact that statutory regimes should be coherent and not self- defeating. Doctors and pharmacists being complementary and supplementary to each other in the medical profession, a comprehensive view must be adopted to regulate their conduct in view of e contemporary statutory regimes and regulations. Therefore, denial of the tax benefit cannot be construed as penalizing the assessee pharmaceutical company. Only its participation in what is plainly an action prohibited by law, precludes the assessee from claiming it as a deductible expenditure. 28. This Court also notices that medical practitioners have a quasi-fiduciary relationship with their patients. A doctor’s prescription is considered the final word on the medication to be availed by the patient, even if the cost of (2002) 6 SCC 16. medication is unaffordable or barely within the economic reach of the patient – such is the level of trust reposed in doctors. Therefore, it is a matter of great public importance and concern, when it is demonstrated that a doctor’s prescription can be manipulated, and driven by the motive to avail the freebies offered to them by pharmaceutical companies, ranging from gifts such as gold coins, fridges and LCD TVs to funding international trips for vacations or to attend medical conferences. These freebies are technically not ‘free’ – the cost of supplying such freebies is usually factored into the drug, driving prices up, thus creating a perpetual publicly injurious cycle. The threat of prescribing medication that significantly marked up, over effective generic counterparts in lieu of such a quid pro quo exchange was taken cognizance of by the Parliamentary Standing Committee on Health and Family Welfare26 which made the following observations: “The Committee also notes that despite there being a code of ethics in the Indian Medical Council Rules introduced in December 2009 forbidding doctors from accepting any gift, hospitality, trips to foreign and domestic destinations etc from healthcare industry, there Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 14 the fact that statutory regimes defeating. Doctors and pharmacists being complementary and supplementary to each other in the medical profession, a comprehensive view must be adopted to regulate their conduct in view of e contemporary statutory regimes and regulations. Therefore, denial of the tax benefit cannot be construed as penalizing the assessee pharmaceutical company. Only its participation in what is plainly an action claiming 28. This Court also notices that medical practitioners fiduciary relationship with their patients. A doctor’s prescription is considered the final word on the ven if the cost of medication is unaffordable or barely within the economic such is the level of trust reposed in doctors. Therefore, it is a matter of great public d that a doctor’s prescription can be manipulated, and driven by the motive to avail the freebies offered to them by pharmaceutical companies, ranging from gifts such as gold coins, fridges and LCD TVs to funding international end medical conferences. the cost of supplying such freebies is usually factored into the drug, driving prices up, thus creating a perpetual publicly injurious cycle. The threat of prescribing medication that significantly marked up, over effective generic counterparts in lieu of such a quid pro quo exchange was taken cognizance of by the Parliamentary Standing Committee on Health and Family Welfare26 which made otes that despite there being a code of ethics in the Indian Medical Council Rules introduced in December 2009 forbidding doctors from accepting any gift, hospitality, trips to foreign and domestic destinations etc from healthcare industry, there is no let-up in this evil practice and the pharma companies continue to sponsor foreign trips of many doctors and shower with high value gifts like air conditioners, cars, music systems, gold chains etc. to obliging prescribers who then prescribe costlier drugs as quid pro quo. Ultimately all these expenses get added up to the cost of drugs. The Committee’s attention was drawn to a news item in Times of India dated July 1, 2010 by Reema Nagarajan giving specific instances of violations of MCI code. The Committee cal Government to take strict and speedy action on such violations. Since MCI has no jurisdiction over drug companies, the Government should take parallel action through DCGI and the Income Tax Department to penalize those companies that violate MC manufacturing licences and/or disallowing expenses on unethical activities.” (emphasis supplied) Interestingly, a similar conclusion was arrived at by the US Department of Health and Human Services Office of the Assistant Secretary for Planning and Evaluation, in a report called Savings Available Under Full Generic Substitution Report on Issues Relating to Availability of Generic, Generic-Branded and Branded Medicines, their Formulation and Therapeutic Efficacy and Effectiven dated 04.08.2010. of Multiple Source Brand Drugs in Medicare Part D (dated 23.07.2018).27 The report noticed inter alia, that an empirical study conducted in respect of 20 odd (out of the 600 drugs which were the subject matter of the research paper) brand medications dispensed for a particular period, were capable of generic substitution and would have resulted in substantial benefit to the patients: “Beneficiaries could have saved over $600 million in out of pocket payments had they been dispensed g equivalent drugs. A significant amount of this spending occurred among the top 20 multiple source brands. Substituting these drugs for generic competitors at their median prices would have saved the program and beneficiaries $1.8 billion.” Likewise, by ProPublica (an independent, non ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 up in this evil practice and the pharma companies continue to sponsor foreign trips of many doctors and shower with high value gifts like air conditioners, cars, music systems, gold chains etc. to obliging prescribers who then prescribe costlier drugs as quid pro quo. Ultimately all these expenses get added up to the cost of drugs. The Committee’s attention was drawn to a news item in Times of India dated July 1, 2010 by Reema Nagarajan giving specific instances of violations of MCI code. The Committee calls upon the Government to take strict and speedy action on such violations. Since MCI has no jurisdiction over drug companies, the Government should take parallel action through DCGI and the Income Tax Department to penalize those companies that violate MCI rules by cancelling drug manufacturing licences and/or disallowing expenses on unethical activities.” (emphasis supplied) Interestingly, a similar conclusion was arrived at by the US Department of Health and Human Services Office of the Assistant ry for Planning and Evaluation, in a report called Savings Available Under Full Generic Substitution Report on Issues Relating to Availability of Generic, Branded and Branded Medicines, their Formulation and Therapeutic Efficacy and Effectiven dated 04.08.2010. of Multiple Source Brand Drugs in Medicare Part D (dated 23.07.2018).27 The report noticed inter alia, that an empirical study conducted in respect of 20 odd (out of the 600 drugs which were the subject matter of the research brand medications dispensed for a particular period, were capable of generic substitution and would have resulted in substantial benefit to the patients: “Beneficiaries could have saved over $600 million in out of pocket payments had they been dispensed g equivalent drugs. A significant amount of this spending occurred among the top 20 multiple source brands. Substituting these drugs for generic competitors at their median prices would have saved the program and beneficiaries $1.8 billion.” Likewise, in a previous study by ProPublica (an independent, non-profit newsroom that Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 15 up in this evil practice and the pharma companies continue to sponsor foreign trips of many doctors and shower with high value gifts like air conditioners, cars, music systems, gold chains etc. to obliging prescribers who then prescribe costlier drugs as quid pro quo. Ultimately all these expenses get added up to the cost of drugs. The Committee’s attention was drawn to a news item in Times of India dated July 1, 2010 by Reema Nagarajan giving specific instances of ls upon the Government to take strict and speedy action on such violations. Since MCI has no jurisdiction over drug companies, the Government should take parallel action through DCGI and the Income Tax Department to penalize I rules by cancelling drug manufacturing licences and/or disallowing expenses on unethical activities.” (emphasis supplied) Interestingly, a similar conclusion was arrived at by the US Department of Health and Human Services Office of the Assistant ry for Planning and Evaluation, in a report called Savings Available Under Full Generic Substitution 45th Report on Issues Relating to Availability of Generic, Branded and Branded Medicines, their Formulation and Therapeutic Efficacy and Effectiveness), of Multiple Source Brand Drugs in Medicare Part D (dated 23.07.2018).27 The report noticed inter alia, that an empirical study conducted in respect of 20 odd (out of the 600 drugs which were the subject matter of the research brand medications dispensed for a particular period, were capable of generic substitution and would have resulted in substantial benefit to the patients: “Beneficiaries could have saved over $600 million in out of pocket payments had they been dispensed generic equivalent drugs. A significant amount of this spending occurred among the top 20 multiple source brands. Substituting these drugs for generic competitors at their median prices would have saved the program and in a previous study profit newsroom that does investigative journalism) titled “Dollars for Doctors: Now Extracted from https://aspe.hhs.gov/reports/data point-savings multiple-source on 13.02.2022. The report states, inter alia, that: “More 600 brand name drugs were dispensed and paid for by Part D plans in 2016, despite the presence of generic competition. Plans and beneficiaries paid $8.7 multiple source brands and $34.0 billion for generics. Full substitution of multiple source brands would have resulted in total spending on generic drugs of $39.9 billion, saving the Part D program and its beneficiaries $2.8 billion in 2016. T manufacturer rebates paid to Part D plans or pharmacy benefit managers (PBMs) or statutory discounts paid by manufacturers for brand name drugs, and thus may overstate savings to the program after accounting for the effects that rebates often have on premiums. See Figure 1. *********** Of this $2.8 billion, $2.25 billion is for brand name drugs that have faced generic competition for at least a full year (e.g. the first generic was available in 2015 or earlier). A further $ estimated for substituting generics that were first launched in 2016 and therefore on the market for less than a full year. These 12 Single source includes payments for brand drugs prior to generic entry, e.g. $1.13 billion of Cre the Methods section. savings are likely to grow as additional generic competitors enter the market. Beneficiaries spent $1.1 billion out sharing for brand drugs with comparable generics, averaging twic comparable generics. In 2016, multiple source brand drug cost- sharing averaged $39.15, while generic cost sharing for substitutable products was $17.04. Beneficiaries could have saved over $600 million in out of pocket payments had they been dispensed generic equivalent drugs. A significant amount of this spending occurred among the top 20 multiple source brands. Substituting these drugs for generic competitors at their median prices would have saved the program and ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 does investigative journalism) titled “Dollars for Doctors: Extracted from https://aspe.hhs.gov/reports/data savings-available-under-full-generic-substitution source-brand-drugs-medicare accessed at 16:37 on 13.02.2022. The report states, inter alia, that: “More 600 brand name drugs were dispensed and paid for by Part D plans in 2016, despite the presence of generic competition. Plans and beneficiaries paid $8.7 billion for multiple source brands and $34.0 billion for generics. Full substitution of multiple source brands would have resulted in total spending on generic drugs of $39.9 billion, saving the Part D program and its beneficiaries $2.8 billion in 2016. These estimates do not account for manufacturer rebates paid to Part D plans or pharmacy benefit managers (PBMs) or statutory discounts paid by manufacturers for brand name drugs, and thus may overstate savings to the program after accounting for the s that rebates often have on premiums. See Figure 1. *********** Of this $2.8 billion, $2.25 billion is for brand name drugs that have faced generic competition for at least a full year (e.g. the first generic was available in 2015 or earlier). A further $584 million in savings is estimated for substituting generics that were first launched in 2016 and therefore on the market for less than a full year. These 12 Single source includes payments for brand drugs prior to generic entry, e.g. $1.13 billion of Crestor spending in the example used in the Methods section. savings are likely to grow as additional generic competitors enter the market. Beneficiaries spent $1.1 billion out-of-pocket in cost sharing for brand drugs with comparable generics, averaging twice as much out-of-pocket than for comparable generics. In 2016, multiple source brand sharing averaged $39.15, while generic cost sharing for substitutable products was $17.04. Beneficiaries could have saved over $600 million in out of ments had they been dispensed generic equivalent drugs. A significant amount of this spending occurred among the top 20 multiple source brands. Substituting these drugs for generic competitors at their median prices would have saved the program and Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 16 does investigative journalism) titled “Dollars for Doctors: Extracted from https://aspe.hhs.gov/reports/data- substitution- medicare accessed at 16:37 on 13.02.2022. The report states, inter alia, that: “More 600 brand name drugs were dispensed and paid for by Part D plans in 2016, despite the presence of generic billion for multiple source brands and $34.0 billion for generics. Full substitution of multiple source brands would have resulted in total spending on generic drugs of $39.9 billion, saving the Part D program and its beneficiaries hese estimates do not account for manufacturer rebates paid to Part D plans or pharmacy benefit managers (PBMs) or statutory discounts paid by manufacturers for brand name drugs, and thus may overstate savings to the program after accounting for the s that rebates often have on premiums. See Figure 1. *********** Of this $2.8 billion, $2.25 billion is for brand name drugs that have faced generic competition for at least a full year (e.g. the first generic was available in 584 million in savings is estimated for substituting generics that were first launched in 2016 and therefore on the market for less than a full year. These 12 Single source includes payments for brand drugs prior to generic entry, e.g. stor spending in the example used in the Methods section. savings are likely to grow as additional generic competitors enter the market. pocket in cost- sharing for brand drugs with comparable generics, pocket than for comparable generics. In 2016, multiple source brand sharing averaged $39.15, while generic cost- sharing for substitutable products was $17.04. Beneficiaries could have saved over $600 million in out of ments had they been dispensed generic equivalent drugs. A significant amount of this spending occurred among the top 20 multiple source brands. Substituting these drugs for generic competitors at their median prices would have saved the program and beneficiaries $1.8 billion. See Appendix Table A for these drugs, and figure 2 below for an example. In terms of beneficiary cost overall calculation. Average per beneficiary spending is significantly higher for these b substitutable generics. (See Appendix Table A, also.) Brand drug cost $22.41 for their generic equivalents. For 17 of the top 20 drugs, the ratio of brand to comparable generic out pocket spending (Lamictal) indicating significant per available for beneficiaries. In three cases (Abilify, Lovenox, and Tricor), beneficiary out marginally higher for the generic than the brand dru believe this is due to the interaction of total drug costs and plan coverage in the coverage gap for generics (42% in 2016), meaning patients paid 58% coinsurance for generics that year. This compares to 25% plan coverage and a 50% statutory manufact drugs in 2016.” Cash Tend to Prescribe More Brand 17.03.2016)28 stated that: “...doctors who receive payments from the medical industry do indeed tend to prescribe drugs different than their colleagues who don’t. And the more money they receive, on average, the more brand medications they prescribe.” Data is now available publicly, in the United States, by reason of the Physician Payment Sunshine Act, 2010 i.e., Section 6002 Affordable Care Act, 2010. This law compels manufacturers of drugs, devices, biologics, and medical supplies covered by Medicare, Medicaid, or the Children's Health Insurance Program to report to the Centers for Medicare & Medicaid Services on three broad categories of payments or "transfers of value". These categories cover general payments or transfers of value such as meals, travel reimbursement, and consulting fees. These include expenses borne by manufacturers, such as speaker fees, travel, gif ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 iaries $1.8 billion. See Appendix Table A for these drugs, and figure 2 below for an example. In terms of beneficiary cost-sharing, we find similar results as for the overall calculation. Average per beneficiary spending is significantly higher for these brands than for the substitutable generics. (See Appendix Table A, also.) Brand drug cost-sharing averaged $30.69, compared to $22.41 for their generic equivalents. For 17 of the top 20 drugs, the ratio of brand to comparable generic out pocket spending ranges from 117% (Namenda) to 1,476% (Lamictal) indicating significant per-drug savings are available for beneficiaries. In three cases (Abilify, Lovenox, and Tricor), beneficiary out-of-pocket costs are marginally higher for the generic than the brand dru believe this is due to the interaction of total drug costs and plan coverage in the coverage gap for generics (42% in 2016), meaning patients paid 58% coinsurance for generics that year. This compares to 25% plan coverage and a 50% statutory manufacturer discount for brand drugs in 2016.” There’s Proof: Docs who Get Company Cash Tend to Prescribe More Brand- Name Meds” (dated 17.03.2016)28 stated that: “...doctors who receive payments from the medical industry do indeed tend to prescribe drugs different than their colleagues who don’t. And the more money they receive, on average, the more brand medications they prescribe.” Data is now available publicly, in the United States, by reason of the Physician Payment Sunshine Act, 2010 i.e., Section 6002 Affordable Care Act, 2010. This law compels manufacturers of drugs, devices, biologics, and medical supplies covered by Medicare, Medicaid, or the Children's Health Insurance Program to report to the Centers for Medicare & Medicaid Services on e broad categories of payments or "transfers of value". These categories cover general payments or transfers of value such as meals, travel reimbursement, and consulting fees. These include expenses borne by manufacturers, such as speaker fees, travel, gif Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 17 iaries $1.8 billion. See Appendix Table A for these drugs, and figure 2 below for an example. In terms of sharing, we find similar results as for the overall calculation. Average per beneficiary spending is rands than for the substitutable generics. (See Appendix Table A, also.) sharing averaged $30.69, compared to $22.41 for their generic equivalents. For 17 of the top 20 drugs, the ratio of brand to comparable generic out-of- ranges from 117% (Namenda) to 1,476% drug savings are available for beneficiaries. In three cases (Abilify, pocket costs are marginally higher for the generic than the brand drug. We believe this is due to the interaction of total drug costs and plan coverage in the coverage gap for generics (42% in 2016), meaning patients paid 58% coinsurance for generics that year. This compares to 25% plan coverage urer discount for brand There’s Proof: Docs who Get Company Name Meds” (dated “...doctors who receive payments from the medical industry do indeed tend to prescribe drugs differently than their colleagues who don’t. And the more money they receive, on average, the more brand-name medications they prescribe.” Data is now available publicly, in the United States, by reason of the Physician Payment Sunshine Act, 2010 i.e., Section 6002 of the This law compels manufacturers of drugs, devices, biologics, and medical supplies covered by Medicare, Medicaid, or the Children's Health Insurance Program to report to the Centers for Medicare & Medicaid Services on e broad categories of payments or "transfers of value". These categories cover general payments or transfers of value such as meals, travel reimbursement, and consulting fees. These include expenses borne by manufacturers, such as speaker fees, travel, gifts, honoraria, entertainment, charitable contribution, education, grants and research grants, etc. 29. The impugned judgment, along with the judgments of Punjab & Haryana High Court (Kap Scan) and Himachal Pradesh High Court (Confederation) (supra) have co addressed the important public policy issue on the subject of allowance of benefit for supply of freebies. The impugned judgment’s reasoning is quoted as follows: “A perusal of the decision of Co Tribunal in the assessee's ow of the Hon'ble Himachal Pradesh High Court clearly shows that the basic intention of the decision was that the receiving of the gifts/freebies by Professionals is against public policy as also against the law in so far as the amendment by the Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002, once receiving of such gifts have been held to be unethical obvious corollary to this would also be unethical, being giving of such gifts or doing such acts to induce such Doctors and Medical Professionals to violate the 1956.” (emphasis supplied) https://www.propublica.org/article/doctors who-take-company name- drugs accessed at 16:45 on 13.02 30. Thus, one arm of the law cannot be utilised to defeat the other arm of law public policy and bring the law into ridicule.29 Venkataraman & Co. (P) Ltd. v. CIT30 the assessee under the Act, 1947 was sought to be deducted as a business expenditure. This Court held: “Moreover, it will be against public policy to allow the benefit of deduction under one statute, of any expenditure incurred in violation of the provisions of another statute or any penalty imposed under another ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 honoraria, entertainment, charitable contribution, education, grants and research grants, etc. 29. The impugned judgment, along with the judgments of Punjab & Haryana High Court (Kap Scan) and Himachal Pradesh High Court (Confederation) (supra) have co addressed the important public policy issue on the subject of allowance of benefit for supply of freebies. The impugned judgment’s reasoning is quoted as follows: “A perusal of the decision of Co-ordinate Bench of this Tribunal in the assessee's own case as also the decision of the Hon'ble Himachal Pradesh High Court clearly shows that the basic intention of the decision was that the receiving of the gifts/freebies by Professionals is against public policy as also against the law in so far as endment by the Medical Council Act, 1956 to the Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002, once receiving of such gifts have been held to be unethical obvious corollary to this would also be unethical, being giving of such gifts or doing such acts to induce such Doctors and Medical Professionals to violate the Medical Council Act 1956.” (emphasis https://www.propublica.org/article/doctors company-cash-tend-to-prescribe-more-brand drugs accessed at 16:45 on 13.02-2022 30. Thus, one arm of the law cannot be utilised to defeat the other arm of law – doing so would be opposed to blic policy and bring the law into ridicule.29 In Maddi Venkataraman & Co. (P) Ltd. v. CIT30, a fine imposed on the assessee under the Foreign Exchange Regulation , 1947 was sought to be deducted as a business expenditure. This Court held: “Moreover, it will be against public policy to allow the benefit of deduction under one statute, of any expenditure incurred in violation of the provisions of r statute or any penalty imposed under another Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 18 honoraria, entertainment, charitable contribution, 29. The impugned judgment, along with the judgments of Punjab & Haryana High Court (Kap Scan) and Himachal Pradesh High Court (Confederation) (supra) have correctly addressed the important public policy issue on the subject of allowance of benefit for supply of freebies. The impugned judgment’s reasoning is quoted as follows: ordinate Bench of this n case as also the decision of the Hon'ble Himachal Pradesh High Court clearly shows that the basic intention of the decision was that the receiving of the gifts/freebies by Professionals is against public policy as also against the law in so far as , 1956 to the Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002, once receiving of such gifts have been held to be unethical obviously the corollary to this would also be unethical, being giving of such gifts or doing such acts to induce such Doctors and Medical Council Act, 1956.” (emphasis https://www.propublica.org/article/doctors- brand- 30. Thus, one arm of the law cannot be utilised to defeat doing so would be opposed to In Maddi , a fine imposed on Regulation , 1947 was sought to be deducted as a business “Moreover, it will be against public policy to allow the benefit of deduction under one statute, of any expenditure incurred in violation of the provisions of r statute or any penalty imposed under another statute. In the instant case, if the deductions claimed are allowed, the penal provisions of FERA will become meaningless”. 10.1 Before us, the Ld. Counsel of the assessee has objected applying the ratio of the Apex Laboratories Pvt. Ltd. (supra) mainly on the ground that no violation of MCI Regulations has been observed in the case of assessee by the relevant regulators. The Ld. Counsel relied on the decision of the Hon’ble Supreme Cour case of CIT v. Sun Engineering Works (P.) Ltd. [1992] 198 ITR 297 (SC) and submitted that binding in respect of on any other issues. He further referred to th Hon’ble Supreme Court in the case of ACIT v. A.K. Menon [1995] 215 ITR 364 (SC) to support that authority concerned statute/law alone or liability or consequence thereof and no othe support of the proposition decisions of various courts. Referring to the decisions, the Ld. Counsel submitted that disallowance applying Explanation section 37(1) of the Act pertaining to act of the assessee inviolation/infraction of the law or prohibited by the law by the relevant authority under the Government law. submitted that in the case o ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 statute. In the instant case, if the deductions claimed are allowed, the penal provisions of FERA will become meaningless”. (emphasis supplied) Before us, the Ld. Counsel of the assessee has objected applying the ratio of the Apex Laboratories Pvt. Ltd. (supra) mainly on the ground that no violation of MCI Regulations has been observed in the case of assessee by the relevant regulators. The Ld. Counsel relied on the decision of the Hon’ble Supreme Cour case of CIT v. Sun Engineering Works (P.) Ltd. [1992] 198 ITR 297 (SC) and submitted that any decision of the Hon’ble Court is binding in respect of issues which are called upon to issues. He further referred to the decision of the Hon’ble Supreme Court in the case of ACIT v. A.K. Menon [1995] 215 ITR 364 (SC) to support that authority entrusted concerned statute/law alone can determine and adjudicate the law or liability or consequence thereof and no other part proposition, the Ld. Counsel also relied on the other decisions of various courts. Referring to the decisions, the Ld. Counsel submitted that disallowance applying Explanation of the Act can be made only in respect of expenditure pertaining to act of the assessee, which has been established to inviolation/infraction of the law or prohibited by the law by the relevant authority under the Government law. The Ld. Counsel submitted that in the case of the assessee no adverse action has Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 19 statute. In the instant case, if the deductions claimed are allowed, the penal provisions of FERA will become (emphasis supplied) Before us, the Ld. Counsel of the assessee has objected for applying the ratio of the Apex Laboratories Pvt. Ltd. (supra) mainly on the ground that no violation of MCI Regulations has been observed in the case of assessee by the relevant regulators. The Ld. Counsel relied on the decision of the Hon’ble Supreme Court in the case of CIT v. Sun Engineering Works (P.) Ltd. [1992] 198 ITR 297 Hon’ble Court is only upon to decide and not e decision of the Hon’ble Supreme Court in the case of ACIT v. A.K. Menon [1995] entrusted under the determine and adjudicate the law r party can do so. In the Ld. Counsel also relied on the other decisions of various courts. Referring to the decisions, the Ld. Counsel submitted that disallowance applying Explanation-1 below e only in respect of expenditure which has been established to be inviolation/infraction of the law or prohibited by the law by the The Ld. Counsel f the assessee no adverse action has been initiated against the assessee by the IMC under Regulations or notification expenditure incurred by the assessee will be in the prohibition of the law, has been discussed in the case of the Apex Laboratories Pvt. Ltd. (supra) which being the law, there is no further scope for the assessee to deviate same and thus all the arguments raised in accordingly dismissed. 10.2 Now, when we come to the facts of the instant case regarding various expenses under the hea we find that the Ld. of PG grant (Rs.7 lacs), doctors group meeting (Rs.15,53,340 marketing survey (Rs.29,34,000/ totaling to Rs.74,46,241/ of the assessee submitted that th graduate students for article etc. in national conference submitted that for medical institution students and no to the medical practitioners not in violation of the MCI Regulations survey, the Ld. Counsel submitted that tho to the medical practitioners for conducting medical research ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 been initiated against the assessee by the IMC under Regulations or notification. However, in our opinion expenditure incurred by the assessee will be in the prohibition of has been discussed in detail by the Hon’ble Supreme Court in the case of the Apex Laboratories Pvt. Ltd. (supra) which being here is no further scope for the assessee to deviate and thus all the arguments raised in this accordingly dismissed. when we come to the facts of the instant case regarding various expenses under the head sales promotion and marketing, he Ld. CIT(A) has upheld the disallowance in respect of PG grant (Rs.7 lacs), doctors group meeting (Rs.15,53,340 marketing survey (Rs.29,34,000/-) and sponsoring (Rs.22,56,907/ totaling to Rs.74,46,241/-. Regarding the PG grant, of the assessee submitted that those were provided to the post duate students for displaying posters, presenti article etc. in national conferences. The Ld. Counsel of the assessee for those expenses, payment were medical institution for further distribution to students and no to the medical practitioners , therefore, same are not in violation of the MCI Regulations. Regarding post marketing e Ld. Counsel submitted that those payments to the medical practitioners for conducting medical research Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 20 been initiated against the assessee by the IMC under its However, in our opinion, how any expenditure incurred by the assessee will be in the prohibition of detail by the Hon’ble Supreme Court in the case of the Apex Laboratories Pvt. Ltd. (supra) which being here is no further scope for the assessee to deviate from this respect, are when we come to the facts of the instant case regarding d sales promotion and marketing, has upheld the disallowance in respect of PG grant (Rs.7 lacs), doctors group meeting (Rs.15,53,340/-) post ) and sponsoring (Rs.22,56,907/-) the Ld. Counsel provided to the post presenting papers and . The Ld. Counsel of the assessee were made to the to post graduate therefore, same are Regarding post marketing se payments were made to the medical practitioners for conducting medical research, survey to gain insight on their products. I survey, the Ld. DR submitted that research or efficacy of the medical products can only be determined under the relevant trial rules and any cannot be prescribed on the basis of the feedback for questionnaire random basis. According to him, th the IMC guidelines. Regarding the assessee submitted that tho conducting meeting panel of the speakers and no practitioners. Regarding submitted that expenses were incurred/ on the books etc. which for supporting them and enhancing knowledge. 10.3 The Ld. Counsel of the assessee was asked to provide details, ledger statement of the expenses along with vouchers determination whether same have been incurred in violation of the MCI Regulations as explained by the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra) however, no such details were filed before us and therefore, in the interest of justice, we feel it appropriate to restore the issues in respect of disallowance sustained by the Ld. CIT(A) to the file of the Assess Officer for deciding afresh, ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 on their products. In respect of the post marketing survey, the Ld. DR submitted that research or efficacy of the medical products can only be determined under the relevant trial rules and any cannot be prescribed on the basis of the questionnaires given by the doctors selected on basis. According to him, those expenses are in violation of the IMC guidelines. Regarding the “doctors group meeting submitted that those had been incurred for organizing meeting for continued medical education through a the speakers and no payment was made to the medical Regarding ‘sponsoring expenses’ also, that expenses were incurred/were spent by the assessee etc. which were provided to the medical practitioner or supporting them and enhancing knowledge. The Ld. Counsel of the assessee was asked to provide details, of the expenses along with vouchers determination whether same have been incurred in violation of the MCI Regulations as explained by the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra) however, no such details were filed before us and therefore, in the interest of we feel it appropriate to restore the issues in respect of disallowance sustained by the Ld. CIT(A) to the file of the Assess Officer for deciding afresh, after taking into consideration details of Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 21 n respect of the post marketing survey, the Ld. DR submitted that research or efficacy of the medical products can only be determined under the relevant drug trial rules and any cannot be prescribed on the basis of the the doctors selected on se expenses are in violation of doctors group meeting” also, the been incurred for organizing and ed medical education through a payment was made to the medical the Ld. Counsel were spent by the assessee rovided to the medical practitioner The Ld. Counsel of the assessee was asked to provide details, of the expenses along with vouchers, for determination whether same have been incurred in violation of the MCI Regulations as explained by the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra) however, no such details were filed before us and therefore, in the interest of the substantial we feel it appropriate to restore the issues in respect of disallowance sustained by the Ld. CIT(A) to the file of the Assessing fter taking into consideration details of the medical practitioners to w along with vouchers of all the expenses. The grounds of appeal of the assessee are accordingly allowed for statistical purposes. 11. As far as the grounds of appeal of the Revenue in respect of deletion of the disallowan Rs.15,67,771/- ; other conferences (Rs.30,79,341/ samples Rs.1,08,39,500/ the Ld. Counsel of the assessee submitted that IADVL expenses are for attending conference b Indian Association of Leprologists (IADVL). participation fees, expenses for showcasing the benefit of the doctors or any medical practitioners. Regarding other conference expenses also similar submissions have been made by the Ld. Counsel. Regarding the free samples, the Ld. Counsel submitted that the Assessing the total free samples distributed by the assessee on the premises that the assessee could not given to the doctors and stockiest. According to the Assessing Officer, free samples are in pr same are given to medical medicine of assessee ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 the medical practitioners to whom the assessee has made payments along with vouchers of all the expenses. The grounds of appeal of the assessee are accordingly allowed for statistical purposes. As far as the grounds of appeal of the Revenue in respect of deletion of the disallowance for IADVL Rs.26,05,970/ ; other conferences (Rs.30,79,341/ samples Rs.1,08,39,500/- totaling to Rs.1,80,92,582/ the Ld. Counsel of the assessee submitted that IADVL expenses are for attending conference by the assessee which are organized by the Indian Association of Dermatologist, Venereologists and (IADVL). The nature of the expenses printing charges, stall charges and other for showcasing assessee’s product and same the benefit of the doctors or any medical practitioners. Regarding other conference expenses also similar submissions have been made by the Ld. Counsel. Regarding the free samples, the Ld. Counsel submitted that the Assessing Officer has disallowed 50% of total free samples distributed by the assessee on the premises that the assessee could not quantify the amount of free samples given to the doctors and stockiest. According to the Assessing free samples are in prohibition by the IMC guidelines as medical practitioner/doctors for medicine of assesseeto patients. Before us, the Ld. Counsel of the Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 22 hom the assessee has made payments along with vouchers of all the expenses. The grounds of appeal of the assessee are accordingly allowed for statistical purposes. As far as the grounds of appeal of the Revenue in respect of ce for IADVL Rs.26,05,970/- ; IADVL ; other conferences (Rs.30,79,341/-) and free totaling to Rs.1,80,92,582/- is concerned the Ld. Counsel of the assessee submitted that IADVL expenses are y the assessee which are organized by the Dermatologist, Venereologists and The nature of the expenses is for stall stall charges and other product and same were not for the benefit of the doctors or any medical practitioners. Regarding other conference expenses also similar submissions have been made by the Ld. Counsel. Regarding the free samples, the Ld. Officer has disallowed 50% of total free samples distributed by the assessee on the premises the amount of free samples given to the doctors and stockiest. According to the Assessing ohibition by the IMC guidelines as prescribing the . Before us, the Ld. Counsel of the assessee submitted that Tribunal in the case of M/s Merk Limited (supra) has allowed th being in violation of the MCI guidelines. The relevant finding of the Tribunal (supra) on the issue is reproduced as under: “28. We have carefully considered the rival contentions.With respect to free samples, we do that same is covered against the assessee by the decision of Honourable SC or it is prohibited by MCI Guidelines. Free sample of medicines supplied to doctors is for promotion of the product of the pharmaceutical company. When a new product is lau through the free sample provided, test marketability of new drug launched in the market, give necessary inputs regarding its acceptability etc. of the product. Provision of free samples help impart knowledge to other doctors about the ne practice of their profession. Therefore, distribution of free samples is directly related to business promotion activity of the pharmaceutical company. Thus it is wholly and exclusively for the purposes of the bu company. Further Providing samples of pharmaceutical products is not prohibited under either the Indian Medical Council (Professional Conduct, Etiquette and Ethics), Regulations 2002 (MCI Code) or the Uniform Code of Pharmaceutical Marketing Pharmaceuticals, 2014 (UCPMP) or2019 Organization of Pharmaceutical Producers of India (OPPI) Code of Practice. The UPMP prescribes guidelines under which medical samples should be dispensed which ensure that they are used st each sample shall be marked "free medical sample for sale".Even the draft Uniform Code for Medical Device Marketing Practices (UCMDMP) published for stakeholder consultation on March 16, 2022 lays down guid ensure that medical devices are distributed as samples for evaluation purposes only.The Drugs and Cosmetics Rules, 1945 also recognizes the practice of providing drugs for distribution to medical professionals as a free ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 assessee submitted that Tribunal in the case of M/s Merk Limited (supra) has allowed the expenses incurred on free samples not being in violation of the MCI guidelines. The relevant finding of the on the issue is reproduced as under: We have carefully considered the rival contentions.With respect to free samples, we do that same is covered against the assessee by the decision of Honourable SC or it is prohibited by MCI Guidelines. Free sample of medicines supplied to doctors is for promotion of the product of the pharmaceutical company. When a new product is launched, the doctors through the free sample provided, test marketability of new drug launched in the market, give necessary inputs regarding its acceptability etc. of the product. Provision of free samples help impart knowledge to other doctors about the new medicine/product coming into the relevant practice of their profession. Therefore, distribution of free samples is directly related to business promotion activity of the pharmaceutical company. Thus it is wholly and exclusively for the purposes of the business of the company. Further Providing samples of pharmaceutical products is not prohibited under either the Indian Medical Council (Professional Conduct, Etiquette and Ethics), Regulations 2002 (MCI Code) or the Uniform Code of Pharmaceutical Marketing Practices by the Department of Pharmaceuticals, 2014 (UCPMP) or2019 Organization of Pharmaceutical Producers of India (OPPI) Code of Practice. The UPMP prescribes guidelines under which medical samples should be dispensed which ensure that they are used strictly for clinical evaluation purposes and each sample shall be marked "free medical sample for sale".Even the draft Uniform Code for Medical Device Marketing Practices (UCMDMP) published for stakeholder consultation on March 16, 2022 lays down guidelines to ensure that medical devices are distributed as samples for evaluation purposes only.The Drugs and Cosmetics Rules, 1945 also recognizes the practice of providing drugs for distribution to medical professionals as a free Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 23 assessee submitted that Tribunal in the case of M/s Merk Limited e expenses incurred on free samples not being in violation of the MCI guidelines. The relevant finding of the on the issue is reproduced as under: We have carefully considered the rival contentions.With respect to free samples, we do not find that same is covered against the assessee by the decision of Honourable SC or it is prohibited by MCI Guidelines. Free sample of medicines supplied to doctors is for promotion of the product of the pharmaceutical nched, the doctors through the free sample provided, test marketability of new drug launched in the market, give necessary inputs regarding its acceptability etc. of the product. Provision of free samples help impart knowledge to other doctors w medicine/product coming into the relevant practice of their profession. Therefore, distribution of free samples is directly related to business promotion activity of the pharmaceutical company. Thus it is wholly and siness of the company. Further Providing samples of pharmaceutical products is not prohibited under either the Indian Medical Council (Professional Conduct, Etiquette and Ethics), Regulations 2002 (MCI Code) or the Uniform Code of Practices by the Department of Pharmaceuticals, 2014 (UCPMP) or2019 Organization of Pharmaceutical Producers of India (OPPI) Code of Practice. The UPMP prescribes guidelines under which medical samples should be dispensed which ensure that rictly for clinical evaluation purposes and each sample shall be marked "free medical sample - not for sale".Even the draft Uniform Code for Medical Device Marketing Practices (UCMDMP) published for stakeholder elines to ensure that medical devices are distributed as samples for evaluation purposes only.The Drugs and Cosmetics Rules, 1945 also recognizes the practice of providing drugs for distribution to medical professionals as a free sample by providing specif requiring such samples to be labelled with the words'Physician's Sample assessee has submitted the complete details of such expenses therefore disallowing it to the extent of 50 % is not justified whe the assessee by the decision of the coordinate bench in earlier years. Thus, we direct lower authorities to delete the disallowance of expenses on free samples. Ground no 4 is allowed. 12. The Ld. Counsel of the assessee was asked to provide details of ledger statement of the expenditure incurred along with vouchers but no such details were provided before us for determining whether the expenses incurred are in violation of the ratio laid down in the case of Apex Laboratories Pvt. Ltd. (supra) and therefore, in the interest of the substantial justice appropriate to restore this issue also to the file of the Assessing Officer with the direction of the assessee to produce detail expenses along with vouchers and details of the medical practitioners or other persons extended by the assessee. The grounds of appeal of the Revenue are accordingly allowed for statistical purposes. 13. Before us, the Ld. Cou additional ground raised on the issue of reproduced as under: “1. On the facts and circumstances of the case and in law, the Appellant prays that deduction of Primary Education Cess and Sec ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 sample by providing specific labelling requirements, requiring such samples to be labelled with the words'Physician's Sample - Not to be sold," . Further assessee has submitted the complete details of such expenses therefore disallowing it to the extent of 50 % is not justified when the same issue is covered in favour of the assessee by the decision of the coordinate bench in earlier years. Thus, we direct lower authorities to delete the disallowance of expenses on free samples. Ground no 4 is allowed.” The Ld. Counsel of the assessee was asked to provide details of the expenditure incurred along with vouchers no such details were provided before us for determining whether the expenses incurred are in violation of the ratio laid wn in the case of Apex Laboratories Pvt. Ltd. (supra) and therefore, in the interest of the substantial justice appropriate to restore this issue also to the file of the Assessing Officer with the direction of the assessee to produce detail expenses along with vouchers and details of the medical or other persons etc. to whom benefit has been by the assessee. The grounds of appeal of the Revenue are accordingly allowed for statistical purposes. Before us, the Ld. Counsel of the assessee also referred to additional ground raised on the issue of ‘education cess reproduced as under: On the facts and circumstances of the case and in law, the Appellant prays that deduction of Primary Education Cess and Secondary and Higher Education Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 24 ic labelling requirements, requiring such samples to be labelled with the Not to be sold," . Further assessee has submitted the complete details of such expenses therefore disallowing it to the extent of 50 % is n the same issue is covered in favour of the assessee by the decision of the coordinate bench in earlier years. Thus, we direct lower authorities to delete the disallowance of expenses on free samples. Ground no The Ld. Counsel of the assessee was asked to provide details of the expenditure incurred along with vouchers no such details were provided before us for determining whether the expenses incurred are in violation of the ratio laid wn in the case of Apex Laboratories Pvt. Ltd. (supra) and therefore, in the interest of the substantial justice, we feel it appropriate to restore this issue also to the file of the Assessing Officer with the direction of the assessee to produce detail of expenses along with vouchers and details of the medical etc. to whom benefit has been by the assessee. The grounds of appeal of the Revenue are nsel of the assessee also referred to an education cess’ which is On the facts and circumstances of the case and in law, the Appellant prays that deduction of Primary ondary and Higher Education Cess (*Education Cess") paid on Corporate Tax of Rs. 35.46.277/- disallowable expenditure under section 40(a)(ii) of the Act. 2. The Appellant prays that the AO be directed to allow the deduction total income of the Appellant. 14. Before us, the Ld. Counsel of the assessee submitted that issue has already been settled by the Hon’ble Supreme Court in the case of M/s. Chambal Fertilizers No. 7379 of 2019] and therefore, this additional ground raised by the assessee was not pressed. Accordingly raised is dismissed as infructuous. 15. As far as the ground raised in 2013-14 are concurred, same assessment year 2015 adjudicated mutatis mutandis 16. In assessment year 2014 also raised one additional ground relating to dividend distribution tax additional ground is admitted for adjudication in view of decision of hon’ble supreme court in the case of NTPC Ltd 229 ITR 383(SC) being purely legal ground and no investig required. The submissions of the Ld. Counsel of the assessee in this respect are reproduced as under: ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 Cess (*Education Cess") paid on Corporate Tax of Rs. be allowed since the same is not disallowable expenditure under section 40(a)(ii) of the The Appellant prays that the AO be directed to allow the deduction of the Education Cess while computing the total income of the Appellant.” Before us, the Ld. Counsel of the assessee submitted that issue has already been settled by the Hon’ble Supreme Court in the Chambal Fertilizers & Chemicals Limited and therefore, this additional ground raised by the assessee was not pressed. Accordingly, the additional ground raised is dismissed as infructuous. As far as the ground raised in assessment year 2014 urred, same are identical to ground raised in the assessment year 2015-16 and therefore those grounds are mutatis mutandis following our finding in AY 2015 In assessment year 2014-15 and 2013-14, the assessee has also raised one additional ground relating to “refund of excess dividend distribution tax” paid to its withholding company. additional ground is admitted for adjudication in view of decision of on’ble supreme court in the case of NTPC Ltd 229 ITR 383(SC) being purely legal ground and no investigation of fresh facts The submissions of the Ld. Counsel of the assessee in this respect are reproduced as under: Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 25 Cess (*Education Cess") paid on Corporate Tax of Rs. be allowed since the same is not disallowable expenditure under section 40(a)(ii) of the The Appellant prays that the AO be directed to allow of the Education Cess while computing the Before us, the Ld. Counsel of the assessee submitted that issue has already been settled by the Hon’ble Supreme Court in the & Chemicals Limited [SLP(C) and therefore, this additional ground raised by the additional ground assessment year 2014-15 and are identical to ground raised in the 16 and therefore those grounds are following our finding in AY 2015-16. 14, the assessee has refund of excess paid to its withholding company. The additional ground is admitted for adjudication in view of decision of on’ble supreme court in the case of NTPC Ltd 229 ITR 383(SC) ation of fresh facts The submissions of the Ld. Counsel of the assessee in this “Part I : The Appellant has fil excess dividend distribution tax(DDT*) paid for AY 2013 14 on February 21, 2023 and for AY 2014 04, 2021.The Assessee is 100% WOS subsidiary of Galderma Pharma SA, a Switzerland Company.Thus, Assessee can pro substantiate that the recipient of Dividend was resident of Switzerland. The Assessee submits that even if DDT was paid under 1150, the rate of DTAA ought to be applied and hence the excess DDT should be refunded. The said is referred to the Special Bench vide order dated June 23, 2021 in case of Total Oil Corporation (India) Limited and it is believed that same is heard in week ending February 24, 2023. The Appellant has sought adjournment for the hearing fixed on Marc 03, 2023 for making additional submissions post perusal of the awaited order. However, if the Hon'ble Bench decides to hear the matter despite the outcome and order of the Special Bench, the Appellant requests that approp for recalling and reposting the matter if same is warranted based on decision of the Special Bench so that if any similar / distinguishing facts are to be pointed out and any further submissions are to be made, the same can be considered. On merits, the Appellant has relied on the favorable decisions compiled in LPB 226.” 17. The Ld. DR on the other hand submitted that decision of the Hon’ble Special Bench shall apply over the facts of the case of the assessee also and therefore, the Assessing Officer may be directed to follow the finding of the Special Bench on the issue. ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 The Appellant has filed additional ground on Refund of excess dividend distribution tax(DDT*) paid for AY 2013 14 on February 21, 2023 and for AY 2014-15 on October 04, 2021.The Assessee is 100% WOS subsidiary of Galderma Pharma SA, a Switzerland Company.Thus, Assessee can provide the TRC for those year to substantiate that the recipient of Dividend was resident of Switzerland. The Assessee submits that even if DDT was paid under 1150, the rate of DTAA ought to be applied and hence the excess DDT should be refunded. The said issue was referred to the Special Bench vide order dated June 23, 2021 in case of Total Oil Corporation (India) Limited and it is believed that same is heard in week ending February 24, 2023. The Appellant has sought adjournment for the hearing fixed on March 06, 2023 vide letter dated March 03, 2023 for making additional submissions post perusal of the awaited order. However, if the Hon'ble Bench decides to hear the matter despite the outcome and order of the Special Bench, the Appellant requests that appropriate directions be given for recalling and reposting the matter if same is warranted based on decision of the Special Bench so that if any similar / distinguishing facts are to be pointed out and any further submissions are to be made, the same sidered. On merits, the Appellant has relied on the favorable decisions compiled in LPB-1 from Pg. 125 The Ld. DR on the other hand submitted that decision of the Hon’ble Special Bench shall apply over the facts of the case of the nd therefore, the Assessing Officer may be directed to follow the finding of the Special Bench on the issue. Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 26 ed additional ground on Refund of excess dividend distribution tax(DDT*) paid for AY 2013- 15 on October 04, 2021.The Assessee is 100% WOS subsidiary of Galderma Pharma SA, a Switzerland Company.Thus, vide the TRC for those year to substantiate that the recipient of Dividend was resident The Assessee submits that even if DDT was paid under 1150, the rate of DTAA ought to be applied and hence the sue was referred to the Special Bench vide order dated June 23, 2021 in case of Total Oil Corporation (India) Limited and it is believed that same is heard in week ending February 24, 2023. The Appellant has sought adjournment for the h 06, 2023 vide letter dated March 03, 2023 for making additional submissions post perusal However, if the Hon'ble Bench decides to hear the matter despite the outcome and order of the Special Bench, the riate directions be given for recalling and reposting the matter if same is warranted based on decision of the Special Bench so that if any similar / distinguishing facts are to be pointed out and any further submissions are to be made, the same sidered. On merits, the Appellant has relied on 1 from Pg. 125- The Ld. DR on the other hand submitted that decision of the Hon’ble Special Bench shall apply over the facts of the case of the nd therefore, the Assessing Officer may be directed to follow the finding of the Special Bench on the issue. 18. We have heard rival submission of the parties on the issue dispute and perused the relevant material on record. On the issue of rate of dividend distribution tax Counsel of the assessee and matter has already been heard by the Special Bench of the Tribunal that appeal of the assessee has already been restored to the file of the Assessing Officer light of the decision of the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra), therefore, we feel it appropriate to restore this issue of refund of excess dividend dis file of the Ld. Assessing Officer of the Special Bench, 19. In the result, the appeals of the assessee and Revenue are allowed for statistical purposes. Order pronounced under 1963 on 30/03/2023. Sd/- (ABY T VARKEY JUDICIAL MEMBER Mumbai; Dated: 30/03/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 We have heard rival submission of the parties on the issue dispute and perused the relevant material on record. On the issue idend distribution tax, it has been informed by the Ld. Counsel of the assessee and matter has already been heard by the of the Tribunal and order is awaited. We also note that appeal of the assessee has already been restored to the file of he Assessing Officer on other grounds for deciding light of the decision of the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra), therefore, we feel it appropriate to restore this issue of refund of excess dividend dis file of the Ld. Assessing Officer to be decided following the h, as and when pronounced. In the result, the appeals of the assessee and Revenue are allowed for statistical purposes. Order pronounced under Rule 34(4) of the ITAT Rules, 03/2023. Sd/- ABY T VARKEY) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 27 We have heard rival submission of the parties on the issue-in- dispute and perused the relevant material on record. On the issue informed by the Ld. Counsel of the assessee and matter has already been heard by the and order is awaited. We also note that appeal of the assessee has already been restored to the file of on other grounds for deciding afresh in the light of the decision of the Hon’ble Supreme Court in the case of Apex Laboratories Pvt. Ltd. (supra), therefore, we feel it appropriate to restore this issue of refund of excess dividend distribution to the following the outcome In the result, the appeals of the assessee and Revenue are Rule 34(4) of the ITAT Rules, - OM PRAKASH KANT) ACCOUNTANT MEMBER 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// ITA Nos. 1747/M/2019, 1987, 1988, 1964 & 1965/M/2020 BY ORDER, (Assistant Registrar) ITAT, Mumbai Galderma India Pvt. Ltd. 1747/M/2019, 1987, 1988, 1964 & 28 BY ORDER, (Assistant Registrar) ITAT, Mumbai