Dismissing the appeal, that the assessee was entitled to deduction under section 37 for the current year only of the amount liable to be redeemed in the first year as against the entire discount. The assessee had not incurred the expenditure of Rs. 5 crores but had merely issued debentures at a discount. The redemption of debentures was in stages over a period of time and the discount on debentures had resulted in an enduring benefit during the period of debentures. However, the expenditure incurred to create an enduring benefit did not create any asset or add value to the existing asset. There was no creation of capital asset, which had resulted in an advantage of enduring benefit by discount on debentures. The assessee had failed to satisfy the principle of matching concept since in the assessee’s case it was a financial transaction and the test of matching principle could not be made applicable as in the case of real estate following the percentage completion method. The benefit of discount to the assessee was instant as the assessee had paid a lesser amount as against the amount which was actually payable and therefore, the benefit had to be offered to tax in the same year. The Tribunal was justified in restoring the order of the Assessing Officer. Followed Madras Industrial Investment Corporation Ltd. v. CIT [1997] 225 ITR 802 (SC). (AY.2006-07)