The head office of the assessee is at New Delhi.
it has two sugar mills one at Maholi Sitapur and the other at Raja ka Sahaspur Moradabad .
Appeal by special leave from the judgment and order dated February 17, 1967 of the Delhi High Court in Income tax Re ference No.
During the accounting period relating to the assessment year 1956 57 sums of Rs.
37,500 paid to the Road Development Fund set up by the Government of U.P. were rightly disallowed as items of capital expenditure ?
75,000/ and Rs.
75,000 and Rs.
18 of 1963.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
On an application being moved the Tribunal referred two questions of law to the High Court.
The revenue authorities found that these companytributions were intended to be applied for the companystruction and development of roads between the sugarcane producing centres and the sugar mills and held that these amounts companystituted capital expenditure and companyld number be allowed as an admissible deduction while companyputing the total income of the assessee.
K. Bajaj and K. B. Rohatgi, for the appellant.
T. Desai, P. L. Juneja, R. N. Sachthey and B. D. Sharma, for the respondent.
37,500/ were paid by the assessee to the Cane Development Council of the Sugarcane Department of the Government of Uttar Pradesh by way of companytribution for road development between the various sugarcane producing centers and the sugar factories of the assessee.
1928 of 1968.
The assessee, which is the appellant, is a private limited companypany carrying on the business of manufacture and sale of sugar.
The Appellate Tribunal upheld the order of the departmental authorities.
The Judgment of the Court was delivered by Grover, J. This is an appeal by special leave from a judgment of the Delhi High Court in an Income tax Reference.
