TMI Blog1998 (9) TMI 136X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee itself. We, therefore, direct the AO to follow our decision in regard to this ground of appeal as per our order in ITA No. 113/Jp/96. 3. The next ground of appeal is in regard to inclusion of Kherthala contract receipts in the computation of total turnover under s. 80HHC. This ground is also covered by our decision in the case of the assessee in ITA No. 113/Jp/96 dt. 10th Sept., 1998. The AO is, therefore, directed to follow the same in this case also. 4. Ground No. 3 of the grounds of appeals is in regard to the decision of the CIT(A) holding that the investment in generator set as capital in nature and restricting the same by allowing depreciation @ 25 per cent on such investment. 4.1. As against this, the learned auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able as revenue expenditure." and in the case cited at (1969) 73 ITR 301 (HL), their Lordships have dismissed the appeal filed by the assessee that the premiums or lump sums paid by the company in order to acquire the leases were lump sum payments for the acquisition of assets for the purpose of carrying on a trade thereon and were, therefore, capital payments. The undisputed fact of this ground of appeal is that assessee has purchased a generator set during the year in question, benefit of which would be derived over the years. Unquestioningly, this is a capital asset and hence the expenditure on purchase of this item cannot be considered as a revenue expenditure. The case law relied upon by the assessee are besides off the point support ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epreciation was allowed. Extension and expansion of the building is treated as put to use and hence depreciation is allowable. 5.2. After hearing the arguments put-forth by the learned authorised representative and also the fact that the building in question was purchased from RIICO and was put to use right from the beginning but the assessee besides using it as storage house for keeping the raw material and finished products also carried on addition/alteration to serve its own purposes. Under the circumstances and also following the decision of various Courts the term user should be given a wider meaning in this case. Accordingly, the AO is directed to allow depreciation on this asset. 6. Ground No. 5 in ITA No. 1023/Jp/1997 is on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the expansion of the capital fees of the company." Their Lordships, while announcing this decision, have discussed the decision of Rajasthan High Court cited at (1990) 89 CTR (Raj) 240 : (1990) 188 ITR 151 (Raj). Keeping in view the above facts, we hold that the decision of the CIT(A) on this account is reasonable and justified. We decline to interfere in the order of the CIT(A) on this account. 7. Ground No. 6 of the grounds of appeal in ITA No. 1023/Jp/97 and Ground No. 4 in ITA No. 1033/Jp/97 relates to non-inclusion of dividend income earned during the year while computing the business income for the purposes of computing deduction under s. 80HHC. This ground of appeal has been discussed in detail and decided against the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business activities and maintaining good business relations with the members of staff. This expenditure is held to be fully allowable. 9. Ground No. 8 in ITA No. 1023/Jp/97 and Ground No. 5 in ITA No. 1033/Jp/97 relates to disallowance under s. 37(4) of the IT Act. 9.1. We have an occasion to discuss and decide this ground of appeal while dealing with ITA No. 113/Jp/96 for asst. yr. 1993-94. The AO is, therefore, directed to follow the decision in ITA No. 113/Jp/96 on this account in these two appeals also. For statistical purposes, this ground is treated as allowed. 10. Ground No. 9 in ITA No. 1023/Jp/97 and Ground No. 6 in ITA No. 1033/Jp/97 is on the ground that CIT(A) erred in holding that the assessing authority had rightly excl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the authorities below. 10.3. We have examined the full facts of this ground of appeal and are of the opinion that the decision relied on by the learned authorised representative and cited at (1982) 134 ITR 507 (Cal) relates to Mrs. Leela Nath vs. CIT, whereas the issues decided by the Hon ble High Court are altogether different and has no relevance to the grounds in appeal before us. Similarly, the case law relied upon by the learned authorised representative and cited at (1991) 192 ITR 144 (Cal) has no relevance to the ground in question before us. 10.4. We, however, observe that the decision of the Hon ble Supreme Court in the case of CIT vs. Govinda Choudhury Sons (1994) 116 CTR (SC) 61 : (1993) 203 ITR 881 (SC) is directly on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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