TMI Blog2018 (9) TMI 1094X X X X Extracts X X X X X X X X Extracts X X X X ..... of this test. If the advantage consists merely in facilitating the assessee's trading operations or enabling the management and conduct of the assessee's business to be carried on more efficiently or more profitably while leaving the fixed capital untouched, the expenditure would be on revenue account, even though the advantage may endure for an indefinite future. We are inclined to accept the submission made by the assessee before the Tribunal that in view of the advanced technology software become obsolete within short intervals. Therefore, the Tribunal rightly applied the decision in the case of Southern Roadways Ltd. [2007 (6) TMI 193 - MADRAS HIGH COURT] - tribunal was right in holding that software expenditure is to be treated as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , for a considerable period of time. On appeal before the Tribunal, the assessee contended that in view of the advanced technology, the software becomes obsolete within short intervals. Further the software purchased were not customer made but one as could be used by anyone and the assessee has only a right to use. The assessee made an alternate submission that if it is treated as capital expenditure, depreciation as applicable to computers also should be granted. The Tribunal, on an appeal filed by the Revenue, followed the decision of Honourable Division Bench of this Court in Commissioner of Income-Tax v. Southern Roadways Ltd. [2008 (304) ITR 84 (MAD)]. 4. Mr. T. Ravikumar, learned Standing Counsel for the Revenue, placed relian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alyzing such like activities to promote speed and efficiency and the parties chose to have a composite arrangement is one factor which the Tribunal was entitled to take into consideration. In our considered view, the decision in Bharti Televentures is not applicable to the case on hand as there is no material before the Tribunal or before the Assessing Officer as was pointed out in the said case . As held by the Honourable Supreme Court in Empire Jute Co. Ltd. v. CIT, [1980 (124) ITR 1 (SC)] there may be cases where expenditure, even if incurred for obtaining advantage, of enduring benefit, may, none-the-less, be on revenue account and the test of enduring benefit may break down. It is further held that it is not every advantage ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
