https://www.taxtmi.com/caselaws?id=289221 Expenditure incurred at the commencement of business to acquire the instrument by which profits are earned is capital in nature, even where the item is ancillary to the main machinery and requires periodic replacement. The governing test is the nature, aim and object of the outlay: costs tied to initiating the business or bringing into existence an enduring advantage are capital, while recurring expenses in the ordinary course of earning profits are revenue. On that basis, the cost of purchasing types for a printing machine was treated as part of the initial outlay and not as deductible revenue expenditure under the Income Tax Act, 1922; the disallowance was upheld. en-us Wed, 19 Aug 1964 00:00:00 +0530 Fri, 04 Dec 2020 10:35:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=289221 Expenditure incurred at the commencement of business to acquire the instrument by which profits are earned is capital in nature, even where the item is ancillary to the main machinery and requires periodic replacement. The governing test is the nature, aim and object of the outlay: costs tied to initiating the business or bringing into existence an enduring advantage are capital, while recurring expenses in the ordinary course of earning profits are revenue. On that basis, the cost of purchasing types for a printing machine was treated as part of the initial outlay and not as deductible revenue expenditure under the Income Tax Act, 1922; the disallowance was upheld. Case-Laws Income Tax Wed, 19 Aug 1964 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=289221