2010 (6) TMI 827

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....ss of the Assessee. On the ground that it is incurred in the course of business activity carried on by the Assessee. ii) Whether the Tribunal was correct in holding that some of the expenses incurred for acquiring a capital asset was on revenue account. Despite there being no proof to substantiate such a claim and the conclusion being drawn on mere conjectures and surmised. 2. The facts leading to the filing of this appeal are that the respondent Assessee, for the assessment year 1998-99 sought deduction in respect of three items viz., (i) disallowance of prior period expenditure of ₹ 15,797/-, (ii) advances written of less than five years old ₹ 5,55,794/- and (iii) advances made for procuring capital goods written off &#8377....

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....nting to ₹ 7,97,645/- was in the nature of capital expenditure. But however the tribunal allowed the appeal of the Assessee and granted the said deduction which is not in accordance with the said provision. He further submits that the substantial question of law have to be answered in favour of the appellant by allowing the appeal. 5. Per contra learned counsel for the respondent assessee submitted that since the expenditure which was incurred in the instant case was not result in the capital asset coming into existence and it was only in the nature of advance payment the said deduction has to be granted under Section 37 of the Act. In support of his submission he has relied upon a decision of the Calcutta High Court reported in the ....