TMI Blog1970 (8) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... lease for seven years for digging earth for manufacturing bricks. The assessee incurred an expenditure of Rs. 13,205 in obtaining the lease. Again, the assessee spent a sum of Rs. 1,729 for erecting a chimney for the brick-kiln. The assessee claimed deduction for these two sums as revenue expenditure. This claim was disallowed by the income-tax authorities and by the Appellate Tribunal. At the request of the assessee, the Appellate Tribunal referred the following questions of law to this court : "(1) Whether, on the facts and in the circumstances of the case, the assessee was entitled to the deduction of Rs. 13,205 being the lease amount (including stamp fees) paid by the assessee? (2) Whether the cost of the chimney in the brick-kiln ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a person for the payment of a lump sum down secures a supply of the raw material for a period extending over several years. In Singareni Collieries Co. Ltd. v. Commissioner of Income-tax , the assessee-company which carried on coal mining business acquired lease in respect of several coal fields for a sum of Rs. 45 lakhs, the lease period being 99 years. The company bad to pay yearly dead rent in respect of any coal field not worked. It was held that the dead rent is relatable to royalty that will have to be paid. Such payment was revenue expenditure. In the instant case we are not concerned with the payment of any royalty or dead rent. The case of Benarsidas Jagannath, In re, is a decision of a Full Bench of the Lahore High Court. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eading to an opposite conclusion) for treating such an expenditure as properly attributable not to revenue but to capital." In Abdul Kayoom v. Commissioner of Income-tax , the assessee carried on business in the purchase and sale of conch shells. It took from Government a lease for exclusive rights, liberty and authority to fish for and take and carry away shell in the sea off the coastline for a period of three years on a consideration of yearly rent of Rs. 6,111. It was held by the Supreme Court that the amount of Rs. 6,111 paid by the assessee was an amount paid to obtain an enduring asset in the shape of an exclusive right to fish. The expenditure was not deductible under section 10(2)(xv). In the present case a copy of the lease o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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