1990 (10) TMI 95

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....itors meeting 7,712.00 3. Adv. bill of final notice 5,141.00 4. Stationery & Prtg. exps. 3,000.00 5. Liquidators & auditors exps. 5,000.00 6. Other expenses 3,140.00 --------------------- 57,993.00 --------------------- Total A + B = 75,704.20 ECC 30% 22,711.20 IPL 70% 52,993.00 = 75,704.20 Note : As per clause No. 10 of scheme of Amalgamation, all costs, charges and expenses pertaining to amalgamation should be borne by IPL & ECC in preparation of 70% and 30% respectively. Rs. (1) IPL Share (70%) 52,993.00 Less : Exps. will be paid by IPL 10,000.00 ----------------- = 42,993.00 ----------------- (2) ECC Share (30%) 22,711.20 Less : Adv. bill paid 7,711.00 ---------------- Pr....

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....eir own character. Legal expenses are not a direct item of expenditure connected with any capital item such as the acquisition of any capital asset or its expansion. 4. The learned departmental representative relied upon the following two decisions : Addl. CIT v. Rohit Mills Ltd. [1976] 104 ITR 132 (Guj.) CIT v. Mihir Textile Ltd. [1976] 104 ITR 132 (Guj.) He submitted that the test was whether the expenditure brought about the benefit of any enduring nature. In that connection he drew the attention of the Tribunal to the directors' report where it was shown that the company had incurred a loss of Rs. 81,478 and also the observation regarding the operations of the company which showed that the turnover was lower this year compar....