Case: Commissioner of Income Tax-2, Mumbai Vs. Raymond Limited

This appeal by the Revenue against the order of the Income Tax Appellate Tribunal dated 13 February 2009 relates to AY

Court's reasoning:
4. The mere fact that a Debenture Redemption Reserve is labeled as a reserve will not render it as a reserve in the true sense or meaning of that concept. An amount which is retained by way of providing for a known liability is not a reserve. Consequently the Tribunal was correct in holding that the amount which was set apart as a Debenture Redemption Reserve is not a reserve within the meaning of Explanation (b) to Section 115JA of the Income Tax Act, 1961. No substantial question of law would, therefore, arise.5. Re question (b): As regards question (b) the Tribunal has relied upon its order in the case of the assessee for Assessment yearwhich in turn relies upon an order for AYThat order in turn relied upon the order of the Tribunal for Assessment yearwhich had been confirmed by this Court, treatingexpenses as revenue expenditure. The order passed by the Assessing Officer notes in paragraph 9.1 that theexpenses related to the following items viz. salary and wages, staff welfare expenses, power, travelling, legal and professional fees and miscellaneous expenses. Evidently these are of a revenue nature. For all these reasons question (b) will not give rise to any substantial question of law.