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Deputy Commissioner Of Income-Tax vs Metalman Auto (P.) Ltd. on 30 June, 2000 cites

Arvind Mills Ltd vs Commissioner Of Income Tax, Gujarat on 21 July, 1992

(i) The ld. D.R. has relied on the judgment of the Supreme Court in the case of Arvind Mills Ltd. (supra), where the Apex Court has held that betterment charges paid by the assessee to effect improvements on lands within a scheme such as laying of roads and drainages, which ultimately resulted in increasing value of capital asset of the assessee, the expenditure was held to be capital in nature. In this case, there is nothing to suggest that expenditure was incurred resulting in increasing the value of capital asset. It only resulted in improving the quality of the existing product already manufactured by the assessee.
Supreme Court of India Cites 16 - Cited by 55 - G N Ray - Full Document

Commissioner Of Income-Tax, Madras vs M/S. Ashok Leyland Ltd on 3 October, 1972

(ii) In the case of Ashok Leyland Ltd. (supra), the assessee had paid compensation to managing agents for dropping assembly of motor car as the assessee had started new business of manufacturing of trucks. Owing to this, continuance of managing agency became surplus and, therefore, the assessee paid compensation for termination of the services of the managing agents. In the light of these facts, the Supreme Court held that compensation paid for termination of the services of the managing agents was with a view tosave business expenditure in the accounting period as well as a few subsequent years, it was not made for acquiring any enduring benefit or income yielding asset. Therefore, the expenditure was of a revenue nature and was an allowable deduction in computing the profits of the assessee-company. The facts of that case are clearly distinguishable from the present case. The assessee had not paid any compensation and, therefore, this does not support the case of the Revenue.
Supreme Court of India Cites 3 - Cited by 151 - K S Hegde - Full Document

Commissioner Of Income-Tax vs Noroth Oil Mill Co. Ltd. on 24 November, 1981

(iv) In the case of Noroth Oil Mill Co. Ltd. (supra), the expenditure incurred on replacement of engines after four years with engines of higher horse power was held to be capital expenditure by the Kerala High Court on the ground that renewal resulted in enduring advantage. Admittedly, in this case, replacement related to engines of higher horse power, which was capital asset but in the case before us, the expenditure incurred relates to modification of the existing components of automobile, processes resulting in greater efficiency and economy. Such expenditure does not relate to replacement of the assets and hence this judgment is also not applicable to the facts of this case.
Kerala High Court Cites 21 - Cited by 10 - Full Document

Commissioner Of Income-Tax vs Digvijay Cement Co. Ltd. on 16 December, 1997

(v) The next case relied on by the ld. D.R. is of Gujarat High Court in the case of Digvijay Cement Co. Ltd. (supra). In that case, the assessee was manufacturing cement. Expenditure was incurred in obtaining feasibility report for setting up shipyard, which was altogether a new business. Report was not favourable and shipyard was not set up. In the light of these facts, the Gujarat High Court held that the object of expenditure was to bring into existence asset or advantage of enduring nature and, therefore, the same was capital expenditure. In this case, the expenditure related to the existing business. Therefore, the same could not be held to relate to capital asset. Hence the judgment is not applicable to the facts of this case.
Supreme Court of India Cites 3 - Cited by 32 - S C Sen - Full Document

Commissioner Of Income-Tax vs Hindustan Pilkington Glass Works on 9 April, 1981

(vi) The ld. D.R. had referred to the judgment of the Calcutta High Court in Hindusthan Pilkington Glass Works Ltd (supra), In that case, expenditure was incurred on reconstruction of sheet glass furnace which was a capital asset. The same was held to be a capital expenditure because it related to a capital asset. This situation is not before us in the present case.
Calcutta High Court Cites 16 - Cited by 18 - S Mukharji - Full Document

Assam Bengal Cement Co. Ltd vs The Commissioner Of Income-Tax,West ... on 11 November, 1954

(vii) The ld. D.R. has referred to the judgment of the Supreme Court in the case of Assam Bengal Cement Co. Ltd. (supra). In that case, the assessee had paid compensation to lessor to prevent lessor for granting similar rights of lime stone quarries. The expenditure was incurred to prevent trading competition for the manufacture of cement. In the light of these facts, the Hon'ble Apex Court held that consideration was paid with a view to prevent trading competition in the neighbouring quarries so that the assessee could enjoy monopoly rights. This was held to be capital expenditure because the assessee derived benefit of enduring nature. The nature of expenditure incurred in this case is different and, therefore, the case is distinguishable from the facts of the present case.
Supreme Court of India Cites 7 - Cited by 406 - N H Bhagwati - Full Document

Indian Telephone Industries Ltd. vs Commissioner Of Income-Tax, ... on 23 February, 1979

7. The ld. Counsel for the assessee made a request that through oversight, he could not reply to the points made by the ld D.R. by relying on two decisions of the Supreme Court in the cases in Ciba of India Ltd. (supra) and Indian Telephone Industries Ltd. (supra). He submitted that these judgments did not apply to the provisions of section 35AB as these provisions had not come into being at the relevant time.
Karnataka High Court Cites 8 - Cited by 8 - Full Document

Commissioner Of Income-Tax, Bombay ... vs Polychem Ltd. on 20 November, 1973

6. Replying to the submissions made by the ld. Counsel for the assessee, the ld. D.R. submitted that the assessee had never claimed the deduction under section 35AB of the Act. He submitted that assessee had claimed such expenditure under section 37 of the Act. He also submitted that the assessee had not capitalised its expenditure and claimed the deduction under section 35(2) of the Act. He also submitted that the decision relied on by the ld. Counsel for the assessee in the case of Polychem Ltd. (supra) was not applicable to the facts of the case as the same related to deduction under section 35 on scientific research. He stated that if the assessee wanted to claim deduction under section 35, there was no need on its part to claim the same as revenue expenditure. In that case, the assessee should have capitalised the expenditure and claimed 1/3rd of deduction as provided under section 35AB.
Bombay High Court Cites 4 - Cited by 12 - Full Document
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