https://www.taxtmi.com/caselaws?id=49431 Whether waived advances constitute capital loss or revenue expenditure is resolved by applying the purpose/enduring-asset test: expenditures creating enduring assets are capital, whereas payments made in the ordinary course of business to procure raw material are revenue. The waived amount arose from advances for securing the next crop and functioned as current payments for purchase of sugarcane, not as an investment in an enduring asset; accordingly the write-off is a trading loss and deductible in computing business profits, resulting in allowance of the deduction for the taxpayer. en-us Thu, 03 May 1962 00:00:00 +0530 Fri, 26 Aug 2022 11:29:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=49431 Whether waived advances constitute capital loss or revenue expenditure is resolved by applying the purpose/enduring-asset test: expenditures creating enduring assets are capital, whereas payments made in the ordinary course of business to procure raw material are revenue. The waived amount arose from advances for securing the next crop and functioned as current payments for purchase of sugarcane, not as an investment in an enduring asset; accordingly the write-off is a trading loss and deductible in computing business profits, resulting in allowance of the deduction for the taxpayer. Case-Laws Income Tax Thu, 03 May 1962 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=49431