1985 (1) TMI 14

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....t had entered into with its customers. This expenditure has been incurred over a number of years by the assessee and was shown by the assessee in its books as development expenditure relating to each contract and was written off over the period of years covering the contract. The assessee had also incurred expenditure relevant to the assessment years 1970-71 to 1972-73 with regard to the consultancy services it had obtained from the National Productivity Council, Administrative Staff College and the Engineering Management and Foundry Consultants, Bangalore. In the assessment year 1970-71, it had incurred an expenditure of Rs. 93,377 by way of payment made to the National Productivity Council for obtaining advice for improving the manufactur....

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....e assessment year 1972-73, for similar consultancy service, it paid Rs. 13,737 to the Engineering Management and Foundry Consultants, Bangalore. Now, the assessee has claimed these items of expenditure as revenue expenditure deductible under section 37 of the Income-tax Act during the relevant years. The Income-tax Officer has rejected the claim and held the expenditure to be capital expenditure and, therefore, not deductible. In the appeals preferred by the assessee against that decision, the Appellate Assistant Commissioner agreed with the contention of the assessee and held the expenditure to be revenue expenditure. With that view of the Appellate Assistant Commissioner the Tribunal had concurred and at the instance of the Revenue, the a....