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TMI Blog1998 (6) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Appellate Tribunal was right in law in holding that expenditure by way of bank guarantee commission is expenditure of capital nature and not deductible in computation of total income ?" In Income-tax Reference No. 73 of 1984, the following three questions have been framed for the opinion of this court : "1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the betterment charges were not deductible in the computation of total income ? 2. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that expenditure by way of bank guarantee commission is expenditure of capital nature and not deductible in computation of tot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 94 (AP) and Sivakami Mills Ltd. v. CIT [1979] 120 ITR 211 (Mad) were cited. The assessee relying upon the above two decisions, contended that the view taken in the above two decisions was that the expenditure by way of bank guarantee commission could not be said to be a part of expenditure of a capital nature but revenue expenditure and it was, therefore, deductible in the computation of total income. The Division Bench observed that in those cases such a view was taken. It, however, dissented from the said view and ultimately held that such an expenditure can be said to be expenditure of capital nature and the authorities were right in not granting deduction from total income. Accordingly, the question was decided against the assessee and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in nature and so allowable as deduction. Civil Appeal No. 2832 of 1977 preferred against the said decision was dismissed by this court (see [1997] 227 ITR 464). In view of the aforesaid decision we see no force in this appeal. Accordingly, this appeal is dismissed." In Vallabh Glass Works Ltd.'s case [1982] 137 ITR 389 (Guj), this court dissented from the view taken by the Andhra Pradesh and Madras High Courts, but the Supreme Court in the above two cases dismissed the appeals file by the Revenue on the basis of the above two decisions, virtually affirming the them view taken by them. In these circumstances. in our opinion, the decision in Vallabh Glass Works Ltd.'s case [1982] 137 ITR 589 (Guj), stands impliedly overruled to that exten ..... X X X X Extracts X X X X X X X X Extracts X X X X
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