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TMI Blog2012 (4) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the premises. Consequently, payment was in true sense the revenue expenditure – Decided in favor of assessee. - INCOME TAX REFERENCE NO. 102 OF 1995 - - - Dated:- 30-3-2012 - DR.D.Y.CHANDRACHUD AND M.S.SANKLECHA, JJ. Mr. Vimal Gupta for the Applicant. Ms.Aasifa Khan i/b. Mr. K.B.Bhujle Mr. Atul Jasani, for the Respondent. JUDGMENT : (PER DR.D.Y.CHANDRACHUD, J.) 1. This reference under Section 256(1) of the Income-tax Act, 1961 at the behest of the Revenue seeks the opinion of this Court on the following question of law :- Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in deleting the settlement charges of Rs.5,50,750/- and legal expenses of Rs.1,65,500/- in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the capital account. 3. On the other hand, it has been urged on behalf of the assessee that in the present case, the assessee had been conducting and managing the restaurant even prior to the agreement with the conductor that was entered into in 1976. The agreement dated 11 July 1976 was a conducting agreement by which the business which was carried on by the assessee was continued to be carried on by the conductor. The licences of the business stood in the name of the assessee and had to be renewed by the assessee. Accordingly, when disputes arose, upon which a suit was instituted before the City Civil Court, the assessee could remove the hindrance and obstruction in the conduct of the business in the premises by payment of the set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and permission to conduct and manage the business against the payment of royalty. Disputes arose between the parties which resulted in the filing of a suit before the City Civil Court in which consent terms were arrived at and a decree was passed by consent on 23 April 1983. The payment which the assessee made to the conductor included settlement charges of Rs.5,50,750/- as recorded in the statement of account. This payment was a payment which the assessee effected for resolving disputes and removing the hindrance which was caused in the management and conducting of the restaurant. The conductor was a bare licensee and had no interest by way of tenancy or otherwise in respect of the premises. Consequently, the payment which was made by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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