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TMI Blog2014 (5) TMI 626X X X X Extracts X X X X X X X X Extracts X X X X ..... d as incurred for creating a capital asset? (ii) Whether the Income Tax Appellate Tribunal was correct in holding that the expenditure of Rs.57,32,689/- incurred on 'CNBC Expansion Project' was allowable as revenue expenditure and not as capital expenditure? (arising out of the assessment year 1998-99) As far as the first question i.e. whether the expenditure towards creation of the news archives is concerned, the issue is covered by the decision of this Court in ITA 1624/2006 decided on 29.04.2014. Accordingly, this question is answered in favour of the assessee and against the Revenue. So far as the second issue i.e. the expenditure towards the 'CNBC Expansion Project' is concerned, the facts are that the assessee at th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt is not conclusive in the matter. The expenditure has to be allowed on the basis of incurring the expenditure and even if the same is not debited in the books, necessary correction has to be made while computing the income as held in the case of Kedarnath Jute Manufacturing, Company, Ltd. (Supra). The last issue is whether the expenditure was in the capital field or in the revenue field. The expenditure was incurred with a view to expand one and a half hours programme to 12 hours a day programme. It was in the existing line of business of the assesee. There is nothing on record to show that the finances for this programme were separately arranged or that control and management for this programme was separate and distinct from the existin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anced capacity, the assessee had incurred expenses to the tune of Rs.9,75,559/- towards the salaries of professionals, Rs.42,28,600 towards hire charges and Rs.2,40,000/- towards media professional charges. The assessee had also incurred production expenses to the tune of Rs.2,48,500/-. The very nature of this expenditure required it to be treated as one falling under Section 37(1) of the Act i.e. compelled by business purposes and not resulting in any enduring advantage requiring to be treated in the capital stream. For these reasons, the Court is of the opinion that the question of law has to be answered in favour of the assessee and against the Revenue.
The appeal has therefore failed and is dismissed. X X X X Extracts X X X X X X X X Extracts X X X X
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