Section 37

Court :
HC

Brief :
Held by the Hon`ble Court that, there are a number of tests which are required to decide whether the expenditure is revenue or capital in nature. A number of judgments cited before the court. However in the absence of requisite details regarding production capacity, we remit the matter to the commissioner (Appeals) who will decide the question in accordance with law.

Citation :
Ramaraju Surgical Cotton Mills Vs. C.I.T.

Section 37 Ramaraju Surgical Cotton Mills Vs. C.I.T. 08/21/2007 [2007] 294 ITR 328 (SC) Case Fact: Whether, replacement of assets without increase in production capacity amounts to revenue expenditure? Decision: Held by the Hon`ble Court that, there are a number of tests which are required to decide whether the expenditure is revenue or capital in nature. A number of judgments cited before the court. However in the absence of requisite details regarding production capacity, we remit the matter to the commissioner (Appeals) who will decide the question in accordance with law.

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CA.Saibaburao Nanduri

Chartered Accountant

I am a commerce graduarte of Andhra University. Studied at HINDU COLLEGE, Guntur. Became FCA and started Practice under the name and style of M/s SAIBABU RAO CO I became Chairman of CA Institute, Guntur Branch, during the year 2008-09 My post qualifications are: Information Systems Audit DISA (ICAI) ... Read more

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