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2006 (9) TMI 148 - HC - Income TaxAdmission fees - Nature of income - the admission fee and contribution to infrastructure development fund paid by the assessee to become a member of the stock exchange is a "revenue or capital expenditure"? - HELD THAT:- The Supreme Court in Empire Jute Co. Ltd. v. CIT [1980 (5) TMI 1 - SUPREME COURT] held that the test of enduring benefit is, therefore, not a certain or conclusive test and the same cannot be applied blindly and mechanically without regard to the facts and circumstances of a given case. In the present case, no new assets had been created and there is no addition to or expansion of the profit-making apparatus of the assessee. Payment of admission fee as well as contribution to infrastructure development is like nature of licence fee and it is paid only for carrying on the business. If any payment is made for the purpose of running the business effectively and efficiently, it is only a revenue expenditure. By becoming a member, the assessee is permitted to make use of the facility provided in the Stock Exchange and hence it is only revenue expenditure. It is seen from the record that there is no dispute by the Revenue in respect of the annual fee paid by the assessee to the Coimbatore Stock Exchange. Thus, we are of the view that the Tribunal is right in holding that amount paid towards admission fee as well as contribution to infrastructure development is revenue expenditure and in view of the same, we answer the questions of law in favour of the assessee and against the Revenue. Hence the tax cases are dismissed.
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