Section 37(1) of the Income-tax Act, 1961 - Business expenditure - Allowable as (Royalty)

IT : Where assessee carried on business of reproduction of audio sound and music from master plate provided by film producers and distributors, royalty paid for obtaining rights of reproduction was allowable as revenue expenditure
IT : Where life of carpets is very short and have to be replaced at frequent intervals, expenditure incurred for purchase of carpet was a revenue expenditure
IT : Where assessee was engaged in manufacture of audio and video cassettes, expenses incurred on video division were allowable as revenue expenditure
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[2015] 53 taxmann.com 273 (Delhi)
HIGH COURT OF DELHI
Commissioner of Income-tax
v.
Krishan Kumar*
SANJIV KHANNA AND V. KAMESWAR RAO, JJ.
IT APPEAL NOS. 50 OF 2000, 69,457,460 & 524 OF 2004 & 576 OF 2008†
DECEMBER  2, 2014
I-Section 37(1) of the Income-tax Act, 1961 - Business expenditure - Allowable as (Royalty) - Assessment years 1989-90 and 1991-92 to 1993-94 - Whether where assessee carried on business of reproduction of audio sound and music from master plate provided by film producers and distributors, royalty paid for obtaining rights of reproduction was allowable as revenue expenditure - Held, yes [Para 36] [In favour of assessee]
II-Section 37(1) of the Income-tax Act, 1961 - Business expenditure - Allowable as (Repairs) - Assessment year 1989-90 - Whether where life of carpets is very short and have to be replaced at frequent intervals, expenditure incurred for purchase of carpet was a replacement cost and in nature of current repairs, therefore, same was allowable as revenue expenditure - Held, yes [Para 40] [In favour of assessee]
III-Section 37(1) of the Income-tax Act, 1961 - Business expenditure - Allowable as (Video division) - Assessment year 1989-90 - Whether where assessee was engaged in manufacture of audio and video cassettes and expenses incurred on video division, i.e., salary, wages to employees, selling expenses, etc., same was allowable as revenue expenditure - Held, yes [Para 41] [In favour of assessee]