MOHAN MEAKIN BREWERIES LIMITED Vs. COMMISSIONER OF INCOME TAX NO 2
LAWS(HPH)-1979-3-9
HIGH COURT OF HIMACHAL PRADESH
Decided on March 06,1979

MOHAN MEAKIN BREWERIES LIMITED Appellant
VERSUS
Commissioner Of Income Tax No 2 Respondents

JUDGEMENT

T.U.METHA,C.J. - (1.) THE petitioner assessee is a publiq limited company carrying on the business of manufacture and sale of beer, Indian made foreign liquors, malt, breakfast food articles and soft drinks, etc. During the accounting year 1966 67, relevant to the assessment year 1967 68, the assessee company paid a sum of Rs. 30,000 to the Registrar of Companies, Jullundur, as a fee for the increase of its authorized capital from rupees one crore to rupees five crores. During the assessment proceedings, the assessee company claimed the allowance of this Rs. 30,000 as revenue expenditure incurred by it in the course of carrying on its business, under Section 37(1) of the I.T. Act, 1961. This claim of deduction was disallowed by the ITO, the AAC and then finally by the Tribunal.
(2.) DURING the same accounting year, the assessee company paid an amount of Rs. 5,000 as tax under the provisions of Uttar Pradesh (Nagar Kshettra) Bhumi Aur Bhawan Kar Adhiniyam, 1962, in respect of the land and buildings used for the purpose of its business. Even this amount was claimed as deduction on account of revenue expenditure, but was disallowed by the ITO, the AAC and then by the Tribunal. The present reference is with regard to the above stated two claims for deductions made by the assessee company. The Tribunal has, therefore, referred the following two questions for the opinion of this court: "(1) Whether, on the facts and in the circumstances of the case, the fee of Rs. 30,000 paid for the increase of the authorised capital of the company is an expenditure of revenue nature and an allowable deduction under the Income tax Act, 1961 ? (2) Whether, on the facts and in the circumstances of the case, the sum of Rs. 5,000 representing Bhumi Bhawan Kar, which is a tax paid to the U.P. Government under the Uttar Pradesh (Nagar Kshettra) Bhumi Aur Bhawan Kar Adhiniyam, 1962, in respect of the land and buildings used for the purposes of the company's business is an allowable revenue expenditure under the Income tax Act, 1961 ?"
(3.) SO far as the second question is concerned, the same stands decided by our judgment given in Income tax Reference No. 2 of 1974 on 5th March, 1979 (since reported supra in [1979] 117 ITR 501). In view of that judgment, we answer the second question by saying that the sum of Rs. 5,000 paid on account of tax under the U.P. Act is an allowable revenue expenditure under Section 37 of the I.T. Act, 1961.;


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