TMI Blog1983 (1) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... nt year in question the assessee claimed that the expenditure incurred for the construction of the new shop should be allowed as revenue expenditure because he was compulsorily required to build a new shop on land which was not his own. Before the ITO it was the case of the assessee that the shop constructed by him was to be donated to the municipality after seven years. The claim of the assessee was rejected by the ITO. In appeal, the AAC recorded a finding that it could not be ascertained whether the assessee was given a lease only for seven years and it could not be presumed that the assessee would be ousted from the shop after seven years. . The appeal filed by the assessee thus came to be dismissed. When the matter was taken to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as being of a capital nature. Mr. Thakkar appearing on behalf of the assessee has contended that the expenditure is incurred in the course of the business and that the shop was not constructed for starting any new business afresh. Coupled with this fact, according to the learned counsel, the fact that the assessee was required to part with the possession after seven years should also be considered. The learned counsel contended that since the shop was required to be gifted away to the municipality after seven years the assessee could not be said to have acquired any advantage of an enduring nature, with the result, according to the learned counsel, that the expenditure was rightly treated as revenue expenditure by the Tribunal. Now, the q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tively found that on the admission of the assessee the lease deed had not at all been executed and that the claim that the possession of the shop was to be handed over to the municipality after seven years could not be verified. There is nothing in the order of the Tribunal which can be read as reversing that finding, though it is true that the Tribunal seems to have proceeded on the assumption, for which obviously there is no material or warrant, that the premises were to be handed over to the municipality after seven years. We have proceeded to decide this reference on the footing that the assessee has failed to establish that he was entitled to occupy the premises only for a period of seven years. We need not direct our attention to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court observed that though in a way the benefit obtained by the new construction was an enduring asset to last as long as the lease subsisted, this could not be the sole guideline for all types of cases and when an overall picture is taken on the facts of the case, it would be proper to hold that the expenditure was incurred in keeping up the business and, therefore, was revenue expenditure. We fail to see how the Tribunal was justified in extending the benefit of the decision of the Orissa High Court to the assessee. Firstly, the decision makes it clear that the decision is given on the facts of that case. Secondly, what weighed with the High Court was that the assessee was under an obligation to incur the necessary expenditure. No ..... X X X X Extracts X X X X X X X X Extracts X X X X
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