Under Sec 143(3) whether the expenditure Capital or Revenue is relevant for the regular assessment.

Last updated: 05 December 2011

Court :
HIGH COURT OF DELHI

Brief :
This appeal is directed against the Tribunal’s order dated 19th May, 2006 for the block assessment period 1.4.1988 to 14.10.1998. The main issue raised is in respect of the deletion by the CIT(A) and the Tribunal of the addition of about ` 51.52 lacs made by the Assessing Officer with respect to Capital Assets debited to store consumption. It is also an issue as to whether the question that a particular expenditure is of a Capital or Revenue nature can be a subject matter of block assessment proceedings? The relevant facts are as under:- The assessee had filed a return for the block period from 1.4.1988 to 14.10.1998. In the said return, undisclosed income of Rs.25 lacs was declared. Notices u/s 143(2) of the Income Tax Act were issued to the assessee on 31.7.2000 and 15.9.2000. The assessee filed its reply as required. The assessee is engaged in the manufacturing and production of polyester viscose Blended Yarn and 100% polyester yarn

Citation :
COMMISSIONER OF INCOME TAX ..... Appellant versus EAST INDIA SYNTEX LIMITED..... Respondent