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TMI Blog2023 (10) TMI 1444X X X X Extracts X X X X X X X X Extracts X X X X ..... uestions of law: (i) Whether on the facts and in the circumstances of the case, the Tribunal is right in law in holding that the amount spent on projects for establishing and operating hospitals is revenue expenditure though the same was in the nature of capital expenditure and agreement was terminated? (ii) Whether on the facts and in the circumstances of the case, the Tribunal is right in law in setting aside the disallowance of Rs. 25,34,10,284/- towards nonrecoverable projects cost by holding that the expenditure is in the nature of revenue expenditure even though the expenditure on the construction / expansion of the hospital gave rise to an enduring benefit to the assessee in generating income and, as such, the same was righ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort) for expansion, operation and establishing the existing hospitals. Later the agreement was terminated without acquiring any capital asset for assessee's benefit. The expenditure was incurred during the course of the business of the assessee and therefore, has to be treated as revenue expenditure. With the above submissions, Shri.Easwar prayed for dismissal of this appeal. 6. We have carefully considered rival contentions and perused the records. 7. Undisputed facts of the case are, assessee is a multi-specialty hospital. Assessee had entered into a Collaboration agreement dated 23.11.2007 with GHMT and DSGMC for the purpose of expansion, operation and management of the hospitals belonging to GHMT. The said agreement was terminated on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue expenditure. If any such asset or advantage for the enduring benefit of the business is thus acquired or brought into existence it would be immaterial whether the source of the payment was the capital or the income of the concern or whether the payment was made once and for all or was made periodically..." 11. Admittedly, the agreement between assessee and GHMT and DSGMC was terminated and obligations under the agreement were discharged. Though expenditure was incurred, no capital asset or advantage of 'enduring benefit' was brought in by the assessee after the termination of the agreement. 12. In Assam Bengal Cement, it is held that if the expenses are incurred not for the purpose of bringing in the asset or advantage for the 'enduri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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