In some circumstances, dynamically created sql in code can have better performance than a stored proc. If you have created a stored proc (let's say sp_customersearch) that gets extremely complicated with dozens of parameters because it must be very flexible, you can probably generate a much simpler sql statement in code at runtime.
One could argue that this simply moves some processing from SQL to the web server, but in general that would be a good thing.
The other great thing about this technique is that if you're looking in SQL profiler you can see the query you generated and debug it much easier than seeing a stored proc call with 20 parameters come in.
