Indian Kanoon - Search engine for Indian Law

Karnataka High Court

The Commissioner Of Income Tax vs M/S.Karnataka State Road Transport ... on 7 July, 2014

Bench: N.Kumar, B.Manohar

                            1




IN THE HIGH COURT OF KARNATAKA AT BANGALORE

       DATED THIS THE 7th DAY OF JULY 2014

                       PRESENT

        THE HON'BLE MR. JUSTICE N. KUMAR

                          AND

       THE HON'BLE MR. JUSTICE B. MANOHAR

                  ITA No.708 OF 2008
                          c/w
                   ITA.No.707 of 2008

BETWEEN;

1.The Commissioner of Income-Tax,
C.R.Building,
Queens Road, Bangalore.

2.The Deputy Commissioner of
Income-Tax, Circle-11(1)
C.R.Building, Queens Road,
Bangalore.               ... APPELLANTS COMMON

(By Sri K.V. Aravind, Advocate)

AND:

M/s.Karnataka State Road Transport
Corporation Limited,
P.B.No.2778, K.H. Road,
Shanthinagar,
Bangalore.                ...RESPONDENT COMMON

(By Sri S. Parthasarathi, Advocate)

                      -0-0-0-0-0-
                              2




        These ITAs are filed under Section 260-A of I.T.
Act, 1961 arising out of Order dated 18.10.2007 passed
in ITA.No.847/Bang/2005 and ITA.No.848/Bang/2005
respectively for the Assessment Year 1995-96 and 1996-
97 praying to formulate the substantial questions of law
stated therein and to allow the appeal and set aside the
order      passed   by    the    ITAT,   Bangalore    in
ITA.No.847/Bang/2005       and   ITA.No.848/Bang/2005,
dated 18.10.2007 and confirm the order of the Appellate
Commissioner confirming the order passed by the
Deputy Commissioner of Income Tax, Circle - 11(1),
Bangalore.


        These appeals coming on for hearing this day,
N. KUMAR, J. delivered the following:-

                         JUDGMENT

The substantial question of law which arises for consideration in these two appeals of the revenue is:-

                "Whether      the    expenditure
          incurred    by    the   assessee    for

reconditioning of overaged buses was revenue in nature when incurring of such expenditure resulted in life time of over aged buses?"

2. This Court had an occasion to consider the said question in respect of the same assessee in the case of The Commissioner of Income Tax and another .vs. M/s.Karnataka State Road Transport Corporation Limited [ITA.No.162/2008 decided on 28.4.2014] wherein it has been held that the expenditure incurred by the assessee is a revenue expenditure relying on the judgment of the Apex Court in the case of Ballimal Naval Kishore and another .vs. Commissioner of Income Tax (1997) 224 ITR 414(SC) wherein it was held that the expenditure incurred to preserve and maintain already existing asset and which does not bring a new asset is a revenue expenditure and does not amount to capital expenditure.

3. As the said substantial question of law is already answered by the Apex Court, following the 4 same, we also answer the substantial question of law in favour of the assessee and against the revenue.

4. Accordingly, these appeals are dismissed.

Sd/-

JUDGE.

Sd/-

JUDGE.

*alb/-.