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TMI Blog2009 (8) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... dent. ADARSH KUMAR GOEL, J. (Oral) - The Income Tax Appellate Tribunal, Chandigarh Bench has referred following question of law arising out of its order dated 18.9.1996 passed in ITA No. 1769/Chandi/90 for assessment year 1984-85 for opinion of this Court:- "Whether, on the facts and in the circumstances of the case, the ITAT was right in law in deleting the addition of Rs.4,40,183/- out of trav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med total expenditure of Rs.1,67,973/- under the head 'Research and Development'. It included a sum of Rs. 51,994/- in respect of Motorcycle Project. The rest of the expenditure related to R & D in respect of Mopeds. Expenditure relating to the Motorcycle Project, which are debited to different revenue account, are as under:- (i) Travelling Rs. 3,64,937 (ii) Sales promotion 20,311 (iii) Resea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new series of mopeds. The assessee placed reliance on the cases of J.K. Industries (P) Ltd. (71 I.T.R. 594 and Karamchand Premchand P. Ltd. (137 I.T.R. 209 (Guj). Reliance was further placed on the cases of Bombay Steam Navigation Co (1953) Pvt. Ltd. (1965) 56 I.T.R. 52 (Bom) and Produce Exchange Corpn. Ltd. (77 ITR 739 - SC). Ld. Counsel pleaded that since it is expansion of existing busin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penditure was of a revenue nature because the expenditure had direct nexus with the existing business carried on by the assessee. May be, the expenditure as abortive but its character as a revenue expenditure incurred for the purpose of expansion of existing business would not change." We have heard the parties at length, have gone through the record as also the case law cited supra. On ent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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