TMI Blog1994 (11) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Income-tax Act, 1961, for our opinion : " Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the settling allowance of Rs. 16,000 paid to the employees in connection with the shifting of the factory from Madras to Coimbatore is an admissible deduction ? " The assessee is a company. The assessment for the assessment year 1977-78 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection with the shifting of the factory would amount to capital expenditure. Therefore, the Tribunal was not correct in directing the Assessing Officer to allow this as deduction treating the same as revenue expenditure. In support of this contention, learned standing counsel relied upon a decision of the Supreme Court in Sitalpur Sugar Works Ltd. v. CIT [1963] 49 ITR 160 (SC). According to the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be applicable to the facts of this case. Inasmuch as this expenditure was incurred towards payment of allowance due to the employees, before shifting the factory, we consider that it is revenue in nature and, therefore, allowable as a deduction. In that view of the matter, we consider that there is no infirmity in the order passed by the Tribunal on this aspect. Accordingly, we answer the que ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
