https://www.taxtmi.com/caselaws?id=7219 Payments made to obtain mining or prospecting rights were treated as capital expenditure because they secured the initial right to commence operations or acquire a source of minerals rather than recurring outgoings in an existing business. The prospecting licence fee was held capital in nature since it was an upfront payment to initiate mining and was not linked to extraction volume. Likewise, the tender payment for the right to extract mica from a developed area was capital, as it created an enduring advantage and a source from which trading stock would later be obtained. Both amounts were therefore not allowable as revenue expenditure. en-us Thu, 28 Mar 1968 00:00:00 +0530 Mon, 16 Feb 2009 08:28:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=7219 Payments made to obtain mining or prospecting rights were treated as capital expenditure because they secured the initial right to commence operations or acquire a source of minerals rather than recurring outgoings in an existing business. The prospecting licence fee was held capital in nature since it was an upfront payment to initiate mining and was not linked to extraction volume. Likewise, the tender payment for the right to extract mica from a developed area was capital, as it created an enduring advantage and a source from which trading stock would later be obtained. Both amounts were therefore not allowable as revenue expenditure. Case-Laws Income Tax Thu, 28 Mar 1968 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=7219