TaxTMI 
TaxTMI 
2010 (2) TMI 799
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.... Officer by placing reliance on order of Hon'ble ITAT in assessee's case for assessment year 2003-04 against which department has already filed an appeal before Hon'ble Allahabad High Court. (iii) That the ld. CIT(A) has erred in law and on facts by allowing relief of Rs.74,10,913 by treating research and development as revenue expenditure as against capital expenditure held by the Assessing Officer by placing reliance on order of Hon'ble ITAT in assessee's case for assessment years 2001-02, 2002-03 and 2003-04 against which department has already filed an appeal before Hon'ble Allahabad High Court. (iv) That the ld. CIT(A) has erred in law and on facts by allowing relief of Rs.3,66,76,803 by holding that the provision for warranty is ascertained by placing reliance on order of Hon'ble ITAT in assessee's case for assessment years 2002-03 and 2003-04 against which department has already filed an appeal before Hon'ble Allahabad High Court. (v) That the ld. CIT(A) has erred in law and on facts by allowing relief of Rs.11,24,636 by deleting the addition made on account of export commission by placing reliance on order of Hon'ble assessee's case for assessment ye....
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....ure. For the sake of ready reference, this paragraph is reproduced below:- "28. The learned counsel for the assessee as well as the learned CIT DR has submitted paper-books containing the case-law on which they placed reliance in the course of the arguments. Predictably, whereas the learned counsel for the assessee sought to distinguish the cases cited by the learned CIT DR, the latter's attempt was to distinguish the cases cited by the former. We have gone through the cases cited. In our humble opinion, the question has to be decided on the basis of the facts of the particular case with which we are dealing. One noteworthy feature in all the cases was that there is no divergence of judicial opinion so far as the principles to be applied are concerned; cases were decided on the application of such principles to the facts of a particular case. We have already referred to the common basic principle which runs through all the cases cited by both the sides and there is no need to repeat it. If that principle is applied to the facts of the present case and to the terms and conditions of technical collaboration agreement, it would be seen that the assessee obtained only the right....
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....which would determine its character and not the source and manner of its payment; (iii) the test of "once and for all" payment, i.e., a lump sum payment made, in respect of, a transaction is an inconclusive test. The character of payment can be determined by looking at what is the true nature of the asset which is acquired and not by the fact whether it is a payment in "lump sum" or in an instalment. In applying the test of an advantage of an enduring nature, it would not be proper to look at the advantage obtained, as lasting forever. The distinction which is required to be drawn is, whether the expense has been incurred to do away with, what is a recurring expense for running a business as against an expense undertaken for the benefit of the business as a whole; (iv) an expense incurred for acquisition of a source of profit or income would in the absence of any contrary circumstance, be in the nature of capital expenditure. As against this, an expenditure which enables the profit-making structure to work more efficiently leaving the source or the profit-making structure untouched would be in the nature of revenue expenditure. In other words, expenditure incurred t....
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....f view and on a fair appreciation of the whole fact situation before concluding whether the expenditure is in the nature of capital or revenue." 2.2 For the purpose that the Tribunal had power to take independent decision in subsequent year, the ld. DR placed reliance on the decision of Hon'ble Supreme Court in the case of Raghubir Singh (supra). In this connection, reliance was placed on the head note, where it is mentioned that "The Supreme Court of India should not differ from its earlier decision merely because a contrary view appeared preferable. But, if the previous decision is plainly erroneous, there is a duty of the court to say so and not perpetuate the mistake. A revision of its earlier decision would be justified, if there were compelling and substantial reasons to do so. The earlier decision may be reviewed, for instance, (i) where an earlier relevant statutory provision had not been brought to the notice of the court, or (ii) if a vital point was not considered. Whether the court should review depends on several relevant considerations, such as: (a) What was the nature of the infirmity or error on the earlier occasion, (i) did some pate....
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....sidered the facts of the case and the submissions made before us. We find that the Hon'ble Supreme Court in the case of Raghubir Singh (supra) laid greater emphasis on the principle of consistency that it should not differ from its earlier decision merely because a contrary view appears to be preferable. However, if the previous decision is plainly erroneous there will be a duty on the court to say so and not to perpetuate the mistake. The Hon'ble Court also furnished two illustrations-(i) where relevant statutory provision was not brought to its notice, (ii) if a vital point was not considered. Even if this decision is applied mutatis mutandis to the orders of the Tribunal, the revenue will have to show that either the relevant statutory provision was not brought to the notice or a vital point was not considered. No such case has been made out by the revenue. The Tribunal had considered the same agreement, the lump-sum payment under which was to be paid in five years. Hon'ble Delhi High Court has not brought any new consideration for deciding the issue of capital versus revenue. It merely culled out ratios of various cases already in existence. Therefore, we are of the view that t....