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2016 (6) TMI 254 - AT - Income TaxCancellation of the lease and the payments of the consideration - revenue v/s capital expenditure - Held that:- A perusal of the resolution passed by the Board of Directors of the assessee company in respect of authorization for cancellation of the lease, also talks as compensation and for loss of business. A perusal of the agreement entered into by the assessee shows the relinquishment of the lessees lease rights and interest in the leased premises. It is clearly a capital asset has come into existence in the hands of the assessee, which is of enduring benefit for the business of the assessee and consequently, the expenditure is liable to be treated as capital expenditure. A perusal of the assessment order shows that the Assessing Officer not only treated the same as capital expenditure also, but an expenditure out of the capital, but in the grounds of appeal, the issue of capital expenditure has been raised by the Assessing Officer. As we have held that the said expenditure is a capital expenditure, the Assessing Officer is directed to grant the assessee depreciation, on the same, as applicable. - Decided in favour of revenue
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