BILASRAI JUHARMAL HUF Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS reference is by the Income -tax Appellate Tribunal, Bombay Bench B, under s. 256(1) of the I.T. Act, 1961, at the instance of the assessee, referring the following question to us for our opinion :

(2.) THE ITO allowed as revenue expenditure expenses under item Nos. (a) and (c) above, but disallowed item No. (b), viz., Rs. 25,599 on the ground that the said legal expenses were not incurred for the purpose of business.

(3.) AGAINST the said order of the AAC, the assessee appealed to the Tribunal. The Tribunal found from the material on record that the assessee had gained substantially by filing the suit and had obtained a far higher amount as his share of the partnership property and assets than he would have otherwise got and that the said legal expenses were incurred in connection with the said suit, filed by him against the other group of partners in the said partnerships. However, after referring to various decisions cited across the bar, the Tribunal dismissed the appeal and confirmed the order of the AAC, disallowing the said expenditure as revenue expenditure by observing :