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PETITIONER: ASSAM BENGAL CEMENT CO. LTD.
Vs.
RESPONDENT: THE COMMISSIONER OF INCOME-TAX,WEST BENGAL
DATE OF JUDGMENT: 11/11/1954
BENCH: BHAGWATI, NATWARLAL H. BENCH: BHAGWATI, NATWARLAL H. MAHAJAN, MEHAR CHAND (CJ) DAS, SUDHI RANJAN AIYYAR, T.L. VENKATARAMA
CITATION: 1955 AIR 89 1955 SCR (1) 876
ACT: Indian Income-tax Act (XI of 1922), s. 10(2)(xv)-Capital expenditure-Revenue expenditure-Meaning of and distinction between the two.
HEADNOTE: Section 10(2)(xv) of the Indian Income-tax Act, 1922, uses the term ’capital expenditure’ for which no allowance is given to the assessee. The term ’capital expenditure’ is used as contrasted with the term ’revenue expenditure in respect of which the assessee is entitled to allowance under section 10(2) (xv) of the Act. As pointed out by the Full Bench of the Lahore High Court in Benarsidas Jagannath, In re [(1946) 15 I.T.R. 185] it is not easy to define the term ’capital expenditure’ in the abstract or to lay down any general and satisfactory test to discriminate between a capital and a revenue expenditure. Though it is not easy to reconcile all the decided cases on the subject, as each case had been decided on its peculiar facts, some broad principles could be 973 deduced from what the learned judges have laid down from time to time: (1)Outlay is deemed to be capital whe...