1957 (9) TMI 61

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.... For the Commissioner : M. P. Amin with G. N. Joshi JUDGMENT Tendolkar, J. The assessee before us is the Gopal Mills Co. Ltd., Ahmedabad, who have owned a textile mill for many years and manufacture textiles therein. The land on which the mills are situated is leasehold and about twenty-five years of the lease had to run during the relevant accounting year. The mills used to discharge ....

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....and incurred an expense of Rs. 36,454 for filling up the pit. The question that arises for our determination on this reference is whether this amount is an allowable deduction under section 10(2)(xv) of the Income- tax Act. Now, apart from any authority and looking at the transaction by itself there can be little doubt that this cannot be a revenue expenditure. In the first instance, if the pit....

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....d up ground they can carry on any of the operations in connection with the running of the mills. To that extent a new asset of an enduring character was brought into existence. That the unexpired period of the lease is only 25 years does not make the asset any the less enduring. Mr. Mehta for the assessee has drawn our attention to a decision of a Division Bench of this court in Income-tax Refe....

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....p ground which was capable of being used for the legitimate purposes of the mills. Mr. Mehta also relies on a judgment of the Punjab High Court in Commissioner of Income-tax, Delhi v. S.B. Ranjit Singh [1955] 28 I.T.R. 14. The assessee in that case leased his hotel complete with furnishings and fittings for twenty years at an annual rent of Rs. 50,000 and he incurred an expenditure in re-surfac....