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TMI Blog1981 (1) TMI 129X X X X Extracts X X X X X X X X Extracts X X X X ..... ncurred on travelling abroad in connection with the furtherance of the existing business. The ITO had found that the assessee had claimed Rs. 10,000 as travelling expenses for visit to Japan. It was explained before him that the assessee wanted to establish a manufacturing unit with foreign collaboration for manufacturing of Gaskets which is one of the important motor parts. For this purpose there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore upheld the disallowance. 3. It has been submitted before us by Shri Tandan, the ld. Rep. of the assessee, that the assessee was dealing in motor parts and when he wanted to manufacture Gaskets the expenditure incurred in the course of concluding a foreign collaboration agreement should have been allowed as a revenue expenditure. For this reliance was placed on the decision of the Allahabad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt in the case of 98 ITR 555. 5. We have considered the facts of the case and we are of the view that the claim of the assessee cannot be accepted. From the facts it clear that the assessee was desirous of establishing a new business for manufacture of Gaskets and in that connection certain preliminary expenses had been incurred to explore the possibility of foreign collaboration for such manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a capital expenditure or a revenue expenditure. In the present case it was altogether a new line of business which has contemplated in respect of which the expenditure had been incurred. The object of the expenditure was to bring into existence a new manufacturing business. In view of this the expenditure claimed could not be allowed as a revenue expenditure.
6. The appeal is dismissed. X X X X Extracts X X X X X X X X Extracts X X X X
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