2017 (9) TMI 122 - SCH - Income Tax

Expenses incurred for replacement of membrane cells-II - nature of expenditure - revenue v/s capital expenditure - rule of consistency as Revenue itself treated such expenditure as revenue expenditure - Held that - As decided by HC 2015 (2) TMI 118 - GUJARAT HIGH COURT the attempt to contend that life of membrane would be spread over from 3 to 5 years or that the amount involved for replacement of membrane is huge and, therefore, the departure on the part of the Revenue could be said as justified, in our view, cannot be countenance for two reasons. One is that the amount involved would not make difference for chargability of the tax but the nature of expenditure would be relevant for the chargability of tax. It hardly matters whether the amount is more or less. Further, on the aspect of life of the membrane, nothing is referred to by the A.O. nor by C.I.T. (Appeals) that earlier, such aspect, namely, life of the membrane spread over from 3 to 5 years was not considered or it had missed or otherwise. - Decided in favour of the Assessee.

Summary

The Supreme Court dismissed the special leave petition (SLP) in SLP(C) No.33888/2015 as similar matters have been disposed of by the Court. The delay in Diary No.15942/2017 was condoned, and notice was issued to tag with SLP(C) No.18872/2017.