https://www.taxtmi.com/caselaws?id=196461 Short-term lease payments made to obtain rights to collect salt-bearing earth and extract crude saltpetre in an existing manufacturing business were treated as revenue expenditure, not capital expenditure. Because the leases were recurrent, lasted only about one to two years, and were used merely to secure raw material for production, the outlay was regarded as part of circulating capital and a working expense of the trade. The payments did not acquire a fixed asset or an enduring benefit, and they formed part of the cost of production rather than the price of acquiring business assets. They were therefore deductible in computing business profits. en-us Thu, 08 Feb 1945 00:00:00 +0630 Fri, 01 Dec 2017 17:59:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=196461 Short-term lease payments made to obtain rights to collect salt-bearing earth and extract crude saltpetre in an existing manufacturing business were treated as revenue expenditure, not capital expenditure. Because the leases were recurrent, lasted only about one to two years, and were used merely to secure raw material for production, the outlay was regarded as part of circulating capital and a working expense of the trade. The payments did not acquire a fixed asset or an enduring benefit, and they formed part of the cost of production rather than the price of acquiring business assets. They were therefore deductible in computing business profits. Case-Laws Income Tax Thu, 08 Feb 1945 00:00:00 +0630 https://www.taxtmi.com/caselaws?id=196461