9911796707
TMI Blog1997 (7) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... his court under section 256(2) of the Income-tax Act, 1961 (briefly, the Act) : "Whether, on the facts and in the circumstances of the case, the Tribunal was legally correct in holding that a sum of Rs. 60,000 spent on resurfacing the road within the factory premises was allowable as revenue expenditure?" The facts, in brief, are that the assessee is a private limited company carrying on busin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to depreciation. The Appellate Assistant Commissioner, therefore, directed the Income-tax Officer to allow the depreciation. Aggrieved, the assessee carried the dispute further in appeal before the Appellate Tribunal, which has recorded its findings as follows : "In our view, this merely reflected the expenditure on refurnishing a subsidiary part of the factory premises. We think that in mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e factory premises has been repaired and brought into a condition of normal efficiency. In this view of the matter, we direct allowance of the claim of Rs. 60,000 as revenue expenditure." In Lakshmiji Sugar Mills Co. P. Ltd. v. CIT [1971] 82 ITR 376, the Supreme Court held that the expenditure incurred under a statutory obligation for the development of roads which were originally the property o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earlier decision in Lakshmiji Sugar Mills Co. P. Ltd. v. CIT [1971] 82 ITR 376 (SC), the Supreme Court held that the construction of the roads facilitated the business operations of the assessee and enabled the management and conduct of the assessee's business to be carried on more efficiently and profitably. It was true that the advantage secured for the business of the assessee was of long dura ..... X X X X Extracts X X X X X X X X Extracts X X X X
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