TMI Blog1985 (9) TMI 72X X X X Extracts X X X X X X X X Extracts X X X X ..... hosiery and textile needles. After obtaining approval of the Government of India in 1961, it raised a loan of Rs. 5.5 lakhs from Messrs. Groz-Beckert International, a Swiss Company. During the assessment year 1973-74, it paid the second instalment of the loan and claimed loss of Rs. 91,366 on its remittance because of the devaluation of the Indian currency twice, once in the year 1966 and again in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e circumstances of the case, the Tribunal was right in law in disallowing the loss of Rs. 14,700 incurred at the time of remittance of the second instalment of loan obtained in foreign currency ? 3. Whether, on the facts and in the circumstances of the case, the fee of Rs. 8,250 paid to the Registrar of Companies was admissible as a business expenditure ? " So far as the law points contained i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... em are distinguishable on facts. In India Cements Ltd.'s case [1966] 60 ITR 52 (SC), the finding was that the loan of Rs. 40 lakhs had been taken to be utilised as working capital. As it was held to be a regular expenditure, the amount of Rs. 84,633 spent towards stamp duty, registration fee, lawyer's fee, etc., was also held to be a business expense. Similarly, in Kishan Chand's case [1981] 130 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owed in the following terms (at pp. 273 and 274 headnote): " Held, that the Tribunal had found that the assessee had itself stated in the grounds of appeal before the Tribunal that by the expenditure, the capital base of the assessee company was reinforced on permanent basis, which was the main purpose of the assessee. Though the alteration in the capital structure by raising the share capital o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he above ratio, we also hold that the fees paid under the Companies Act for increasing the share capital were an expenditure of capital nature. Question No. 3 is accordingly answered in the negative, that is, in favour of the Revenue and against the assessee. The case would now go back to the Tribunal for recording a finding as to whether the amount of loan was utilised by the assessee as fixed ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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