PCIT v. Green Delhi BQS Ltd. (2018) 259 Taxman 153 / ( 2019) 175 DTR 131(Delhi) (HC)

S. 37(1) : Business expenditure–Capital or revenue-Encashment of bank guarantee -Failure to perform its part of concessionaire agreement, DTC encashed bank guarantee-Allowable as revenue expenditure.

Dismissing the appeal of the revenue the Court held that; since property constructed was not owned by assessee but by third party i.e. DTC, expenditure incurred in question by assessee was not capital expenditure but revenue expenditure. Even otherwise, since payment made by assessee was on account of failure to perform its part of agreement including operation and maintenance of bus shelters, same was necessarily revenue in character . ( AY. 2009-10)