2002 (2) TMI 33 - HC - Income Tax

Whether, on the facts and in the circumstances of the case, the Appellate Tribunal erred in holding that the expenditure of Rs. 30,183 incurred by the assessee for development of land was a revenue nature and not of a capital nature and was therefore allowable? - The facts found by the Tribunal that the land which has been developed and the expenses which are incurred in developing the land, that land has been treated and found by the Tribunal as stock-in-trade. - In view of the finding of the Tribunal, no interference is called for in the order of the Tribunal. - we answer the question that the Tribunal has not committed any error in allowing the expenditure of Rs. 30,183 as revenue expenditure.

Summary

The High Court of Rajasthan ruled that the expenditure of Rs. 30,183 for land development was allowable as revenue expenditure, not capital expenditure. The Tribunal found that the expenses were necessary for the business of selling the land as stock-in-trade. The court upheld the Tribunal's decision, stating no error was made in allowing the expenditure.