Case: New India Mining Corporation Private Limited Vs. Commissioner of Income Tax

The application for exemption from filing one set of extra Court-fee refused. Deficiency of Court-fee may be met within four weeks  This batch of appeals relate to the asst. yrs. 1961-62 to 1971-72 and arise out of judgments of the Bombay High Court, holding that the appellant-assessee was under no obligation to restore the lands to their original condition upon the determination of the lease and was thus not entitled to any expenditure being allowed for that purpose in computing its income  The Government of Bombay on 23rd April, 1940, granted to the predecessor of the appellant, lease for a period of 30 years on the terms and conditions set out therein. These were mining leases. Clause 3 in Part V of the lease and cl. 17 in part VII are relevant for our purpose. These are  Clause 3, Part V : The lessee shall pay to the Government in respect of all parts of the surface of the said lands which shall from time to time be occupied or used by the lessee under the authority of these presents rent at the rate of Re. 0-0-6 per annum per square yard of the area so occupied or used together with land revenue payable in respect of the land shown in Appendix A during the period from the commencement of such occupation or use until the area shall cease to be so occupied or used and shall be restored to its original condition which rent shall be computed and shall be paid on each of the half-yearly dates hereinabove appointed for payment of the said certain half-yearly rent provided that no such rent shall be payable in respect of the occupation or use of the area comprised in any roads or ways existing on the said lands at the commencement of the term of this lease.  Clause 17, Part VII : The lessee will at the expiration or sooner determination of the said term deliver up to the Government all mines, pits, shafts, inclines, drifts, levels, waterways, airways and other works (now existing) hereafter to be sunk or made under the said lands (except such as may have been abandoned with the sanction of the Government in an ordinary and fair course of working) and all (engines, machinery, plant, buildings, structures and other works and conveniences which at the commencement of the said term were upon or under the said lands and all) engines, machinery, plant and fixtures set up by the lessee below ground level which cannot be removed without causing injury to any mines or works under the said lands (except such of the same as may with the sanction of the Government have become disused) and all buildings and structures of brick or stone erected by the lessee above ground level in good repair, order and condition and fit in all respects for further working of the said minerals.

Reasoning:
We do not think we have to interpret either the clauses of the lease agreement or even sub-r. (iv) of r. 14 of the Mining Concession Rules, 1960, as in the present case, admittedly, no expense has been incurred by the appellant. The questions of law, therefore, do not arise in the present case. Any question of any allowable deduction can arise only if any expense is so incurred by the assessee.