JITENDRA PRINTING WORKS Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE Tribunal has referred the following questions of law arising out of its order dt. 27th Jan., 1986 in respect of the asst. yr. 1980-81 under s. 256(1) of the IT Act, 1961.

(2.) THE relevant facts for the purpose of disposal of this reference are that the assessee claimed deduction in respect of development charges paid to the RIICO. THE Tribunal found that the RIICO has levied two charges, one, of lease of land and the other for development incurred by it. THE development expenses have been incurred by RIICO so that the entire industrial belt is developed according to the standards fixed by the RIICO. THE RIICO in the alternative could have left the development to be made by the assessee himself. In that event the expenditure so incurred by the assessee would be definitely capital in nature though the land is a leasehold land. This matter was considered by this Court in the case of Manoj Dyeing Co. vs. CIT D.B. IT Ref. No. 6/87 decided on 14th Oct., 1992 [since reported at (1995) 125 CTR (Raj) 393] and it was held that :