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1 - 3 of 3 (0.21 seconds)Alembic Chemical Works Co. Ltd vs Commissioner Of Income Tax, Gujarat on 31 March, 1989
On the finding of such fact, the apex court had concluded that the idea of "once for all" payment and "enduring benefit" are not to be treated as something into statutory conditions; nor are the notions of capital or "revenue" a judicial fetish. What is capital expenditure and what is revenue are not eternal verities but must needs be flexible so as to respond to the changing economic realities of business. The expression "asset or advantage of an enduring nature" was evolved to emphasise the element of a sufficient degree of durability appropriate to the context. There is also no single definitive criterion which, by itself, is determinative whether a particular outlay is capital or revenue. The once for all payment test is also inconclusive. What is relevant is the purpose of the outlay and its intended object and effect, considered in a commonsense way having regard to the business realities. In a given case, the test of "enduring benefit" might break down.
Having gone through the aforesaid decision in between the lines, we find that the ratio of the said decision is squarely applicable to the facts of the present case. The decision of the Tribunal is neither contrary to nor violates any of the provisions of law. By relying upon the said decision and considering the facts of the case, we answer the question in the affirmative, that is, in favour of the assessee and against the Revenue. There will be no order as to costs.
D. M. PATNAIK J. - I agree.
Section 144B in The Income Tax Act, 1961 [Entire Act]
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