1997 (1) TMI 556

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....ferred the following three questions for the opinion of this Court under s. 256(1) of the IT Act, 1961. ' 1. Whether, on the facts and in the circumstances of the case, the expenses incurred in the shifting of the assessee's factory from Madras to Coonoor was an allowable deduction? 2. Whether, on the facts and in the circumstances of the case, the sum claimed as provisio....

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....Coonoor. The assessee contended that the premises at Madras was still kept in readiness for the company's officers and the shifting of factory alone to Coonoor, did not give rise to any enduring benefit. The ITO was of the view that since the entire manufacturing unit had been shifted, the retention of the premises at Madras, did not indicate any intention to continue the manufacturing process....

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....g of the machinery as capital expenditure and the expenditure relating to the shifting of the employees as revenue expenditure. Similar view was also taken in CIT vs . Bimetal Bearings Ltd. : [1995]215ITR675(Mad) In as much as the order passed by the Tribunal is in accordance with the above said decisions of this Court, we answer question No. 1 in the affirmative and against the Department. 5. ....

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.... Higgingothems Ltd. in ITA No. 828/77-78 held that it was paid out of business expenditure and was an admissible deduction. On further appeal by the Revenue, the Tribunal followed its own decision in ITA No. 828/Mad/77 dt. 28th Sept., 1978 confirmed the order of the AAC. A similar question came up for consideration in T.C. No. 360 of 1982 wherein by judgment dt. 7th Oct., 1996, this Court held tha....