1990-VIL-54-SC-DT

Equivalent Citation: [1990] 186 ITR 276 (SC), 95 CTR 131

Supreme Court of India

Civil Appeal No 1998 of 1975.

Date: 29.08.1990

COMMISSIONER OF INCOME-TAX, MADRAS

Vs

TV SUNDARAM IYENGAR AND SONS PVT. LIMITED

For the Appellant : S. C. Manchanda, Senior Advocate (Miss. A. Subhashini, Advocate)
For the Respondent : A. T. M. Sampath, Advocate

BENCH

K. JAGANNATHA SHETTY AND KULDIP SINGH JJ.

JUDGMENT

The only question raised in this case is whether the amount advanced by the assessee-employer for construction of houses under "Subsidised Industrial Scheme" for its employees would be in the nature of a revenue expenditure or capital expenditure. The Tribunal has reached the conclusion, on the facts and circumstances of the case, that it was revenue expenditure.

We have perused the order of the Tribunal. The land has been purchased in the name of the Government and the assessee is not the owner thereof. The assessee is only contributing a portion of the construction costs. It is a subsidised welfare scheme. The fact that the scheme is not for any temporary or particular duration makes, in our opinion, little difference to the nature of the expenditure. The Tribunal, in our opinion, is justified in holding that the amount spent is only revenue expenditure. The appeal is, therefore, dismissed but no costs.

 

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