TMI Blog1937 (10) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... y be thought to have produced was of such a problematical, impalpable, intangible character that it cannot be regarded as being of a capital nature. Counsel for the Crown, on the other hand, contended that the payments were made for the purpose of acquiring capital assets or enduring advantages of a capital nature, and that, on the authorities, they were properly attributable to capital and not to revenue. The case to which my attention was drawn in the first place was that of British Insulated and Helsby Cables, Ltd., v. Atherton and particularly to the much-commented-upon dictum of Viscount Cave, L.C., where he said (95 L.J.K.B., at p. 340; [1926] A.C., at p. 213): But when an expenditure is made, not only once and for all, but with a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edly its capital assets was relied upon by counsel for the cross-appellant as a material distinction from the present case. On the other hand, counsel for the Crown relied upon the passage in the judgment of Rowlatt, J., where he said ([1928] 2 K.B., at p. 410): The company have got nothing, says Mr. Latter, for this expenditure. Perhaps that may be so, but they have got this: they have got a field of minerals which has the advantage of being no longer encumbered with an undesirable part. It seems to me that the whole transaction on the clearest possible principles is a capital transaction. Adopting that reasoning, counsel for the Crown contends that, just as the coal company had paid that sum of money for the purpose of getting rid of an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the English company's business was so closely woven into the business of the Dutch company that the view was taken that this ? 450,000 ought to be treated as capital. Counsel for the cross-appellant relied, so far as authority was concerned, upon the decision in Mitchell v. Noble Ltd. That was the case of a payment of ? 19,200 being made to a director to get rid of his services, as he was thought to be undesirable. It was there held that that was a proper charge against revenue. Counsel for the cross-appellant argued that that case has a bearing upon the present case, because, just as there the director was got rid of once and for all, so here Hewitt Kellett, Ltd., were got rid of once and for all, and the advantage of getting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or do I think that the argument of counsel on behalf of the cross-appellant, that what was produced by the expenditure in the present cases was impalpable or intangible or incalculable, is a sound argument for holding that it must be treated as of a revenue nature. In fact, in both these cases the payments which were made had as a result the removal or the prevention of a trade competitor, who would not have been subject to the rules of the association. In my opinion, those payments created for the members of that association advantages of an enduring nature, and, I think, of such an enduring nature as properly to be treated as capital, and not to be treated as revenue. It appears to me that the present case is really a stronger case than t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the grant of ? 5,500 was that Wilson Boilermakers, Glasgow, were brought into the combine and their profits became subject to the pool, which was necessary in the opinion of the association to keep the scheme going. In that case, too, I think that the payment was of a capital nature, because it created what I think may properly be called an asset, or at least an advantage of an enduring nature. For these reasons, with the greatest possible respect to the Commissioners, I am unable to agree with their conclusion on the first case, and I accordingly allow the appeal in the case of Hewitt Kellett, Ltd., and dismiss the appeal in the case of John Thompson (Wolverhampton), Ltd., with costs. Appeal allowed: cross-appeal dismissed. - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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