Section 14A shall not apply to shares held as stock in trade-G. K. K. Capital Markets (P) Ltd. (ITAT Kolkata)

Where the assessee has been assessed at higher amount under sales tax law and demand has been raised against the assessee, notwithstanding that the assessee has not made any entry for liability in his books of accounts and has gone into appeal before higher authorities, the deduction in respect of sales tax demand shall be allowed- Kedar Nath Jute Mfg. Co. Ltd. 82 ITR 363(SC)

Foreign collaborator granted license to assessee to use its patents and designs—Assessee not acquiring capital asset—Amount paid to collaborator was only licence fee and constituted revenue expenditure-I.A.E.C. (PUMPS) LTD. 232 ITR 316

It is not a universally true proposition that what may be a capital receipt in the hands of the payee must necessarily be capital expenditure in relation to the payer. Therefore, the decision in CIT vs. Maheshwari Devi Jute Mills (1965) 57 ITR 36 (SC) wherein it was held that the sale of loom hours was in the nature of capital receipt and hence, not taxable, cannot be regarded as an authority for the proposition that payment made by an assessee for purchase of loom hours would be capital expenditure[Para 4]-Empire Jute Co. Ltd 124 ITR 1

The fact that expenditure is incurred over more than one year is not decisive of its being capital expenditure-Asahi India Safety Glass Ltd. 203 Taxman 277 (Del.)

The extent of the expenditure cannot be a decisive factor in determining its nature.-Asahi India Safety Glass Ltd. 203 Taxman 277 (Del.)

Test of Enduring benefit is not certain or conclusive test. What is important is not that advantage lasts forever but whether the expense incurred does away with a recurring expense(s) defrayed towards running a business as against an expense undertaken for the benefit of the business as a whole. In other words, the expenditure which is incurred, which enables the profit-making structure to work more efficiently leaving the source of the profit-making structure untouched, would be an expense in the nature of revenue expenditure. Fine tuning business operations to enable the management to run its business effectively, efficiently and profitably, leaving the fixed assets untouched would be an expenditure in the nature of revenue expenditure even though the advantage may last for an indefinite period. Test of enduring benefit or advantage would thus collapse in such like cases. It would be only truer in cases which deal with technology and software application, which do not in any manner supplant the source of income or add to the fixed capital of the assessee-Asahi India Safety Glass Ltd. 203 Taxman 277 (Del.)