2001 (11) TMI 62

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.....-The following three questions have been referred to us at the instance of the Revenue for the assessment year 1983-84. "1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal erred in law in not holding that the cost of laying a cement surfaced tennis court in Ramco Club, is capital expenditure and hence is not eligible for deduction in computing the total incom....

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.... therefore the guarantee commission is a capital expenditure?" The assessee is a manufacturer of cement. It has undertaken maintenance of a club for the welfare of its employees. It also during the relevant previous year had given moneys for the welfare of the labourers for the formation of roads, erection of street lights and provision of wells in a house lay out that had been formed by labour....

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....e same as a tennis court, and expenditure on it was rightly regarded by the Tribunal as revenue expenditure. The monies given by the assessee to the employees to enable them to form roads and erect streetlights, etc., in a housing colony formed by them was money spent on the welfare of the employees. The land was not owned by the company. The amount given/spent was a subsidy or a benefit given ....