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TMI Blog2010 (6) TMI 861X X X X Extracts X X X X X X X X Extracts X X X X ..... ative submitted that the assessee is engaged in distribution of television channels through cable net work. During the assessment year under consideration, the assessee has claimed an expenditure of ₹ 66,81,000/- towards laying of cables and claimed the same as Revenue expenditure. However, the assessing officer disallowed the claim of the assessee by holding that the expenditure was in the capital field and allowed depreciation @ 15%. According to the learned departmental representative, the assessee claimed before the lower authorities that there was some dispute between the assessee and the other cable net work operators, more particularly M/s R.R. Cables. The rival cable operators cut and damaged the cable of the assessee. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pital expenditure. The learned departmental representative further pointed out that when the assessee replaced traditional cable by optical fiber cable, there was up gradation. Therefore, the expenditure incurred by the assessee has to be treated as capital expenditure. Referring to the order of the CIT (A), the learned departmental representative pointed out that the CIT (A) is not correct in saying that no new asset came into existence. 3. On the contrary, Shri K. Vasant Kumar, learned counsel for the assessee submitted that the assessee has admittedly in the business of distribution of television channels through net work. The assessee receiving signals through satellite and transmitting the same to the respective customers thro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the public premises and it is out of the control of the assessee. Therefore, the risk of being damaged by rival group, theft by anti socials cannot be ruled out. In those circumstances, according to the learned counsel, the expenditure incurred by the assessee has been rightly allowed by the CIT (A). 4. We have considered the rival submissions on either side and also perused the material available on record. Admittedly, the assessee is in the business of distribution of television channels through cable net work. Originally, the assessee transmitted the television signals by traditional cables. Subsequently, during the assessment year under consideration, the assessee replaced the traditional cable into optical fiber cable. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... By replacing into optical fiber cable, as rightly contended by the learned counsel for the assessee, the viewers may get a better signal. It is not the contention of the Revenue that the subscriber or customer base has increased due to optical fiber cable. The contention of the learned departmental representative is that the assessee may switch over to DTH method of transmission of signal. In our opinion, by using optical fiber cable, the assessee may not be able to switch over to DTH form of transmission. DTH form of transmission is a method of transmission of signal by a wireless mode. In other words, the television cable operators receive the signals from satellite and transmitting the same to the respective customers/viewers thro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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