TMI Blog1998 (2) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... nd it is essential that the conflict should be resolved authoritatively - We, therefore, direct that the papers of this case be laid before the Hon'ble the Chief justice for constituting a larger Bench - - - - - Dated:- 5-2-1998 - B. N. KIRPAL. and S. P. KURDUKAR. JUDGMENT The appellant had taken 25 acres of land on lease for 15 years and had agreed to pay rent at the rate of Rs. 35 per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he jagirdar and the amount paid to the Government was allowable as a revenue deduction. By a majority judgment (2 : 1), this court held that the assessee had acquired by his long-term lease the right to win stones. The stones in situ were not stock-in-trade in the business sense but were a capital asset which he converted into stock-in-trade and, therefore, neither the rent nor the royalty which w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure. It was held by this court that the royalty as well as the dead rent which was paid was relatable to the lime deposits and the annual amount paid by the assessee was allowable as a revenue expenditure. Reference in this judgment was made to the aforesaid decision in Pingle Industries Ltd. v. CIT [1960] 40 ITR 67 (SC), and in regard thereto this court observed as follows : "The case of Pingle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n-trade of the assessee and any payment made for acquiring the same cannot be regarded as a capital expenditure. Furthermore, in order to extract manganese ore land is taken on lease and rent is paid which facilitates the carrying on of the business activities of the assessee. The position is stated to be analogous to that of a trader who takes a shop on rent for the purpose of carrying on his tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the attention of the court was not drawn to the decision in Gotan Lime Syndicate's case [1966] 59 ITR 718 (SC). Prima facie, it appears that there is a conflict in the decisions of this court delivered by co-ordinate Benches in Pingle Industries Ltd.'s case [1960] 40 ITR 67 (SC) and Gotan Lime Syndicate's case [1966] 59 ITR 718 (SC). The question involved is of a recurring nature and it is essenti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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