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Section 37(1) of the Income-tax Act, 1961 - Business expenditure - Allowability of - Assessment year 1977-78 - Assessee, a Government corporation, was formed under Act of Parliament to take over airports in metropolitan towns - During assessment year in question assessee paid certain amount to Delhi Development Authority for development of an alternative site for rehabilitation of villagers who were to be evicted from their lands in village as said lands were acquired for extension of International Airport at Delhi - Whether since expenditure incurred by assessee was to facilitate acquisition and physical control over land, it resulted in bringing into existence an enduring benefit from land acquired and, therefore, expenditure in question was capital expenditure - Held, yes CASE REVIEW International Airports Authority of India v. CIT [2002] 254 ITR 657 (Delhi) affirmed. Hardiallia Chemicals Ltd. v CIT [1996] 218 ITR 598 (Bom)followed & relied upon. CIT v. Auto Distributors Ltd. [1994] 210 ITR 222 (Cal), CIT v.Excel Industries Ltd. [1980] 122 ITR 995 (Bom) and Satyadev Cyhambers (P.) Ltd. v. CIT [1979] 117 ITR 86 (Guj) distinguished. CASES REFERRED TO V. Jaganmohan Rao v. CIT [1970] 75 ITR 373 (SC) [Para 4],Sitalpur Sugar Works Ltd. v. CIT [1963] 49 ITR 160 (SC) [Para 4],Hardiallia Chemicals Ltd. v. CIT [1996] 218 ITR 598/87 Taxman 108 (Bom.) [Para 4], CIT v. Auto Distributors Ltd. [1994] 210 ITR 222 /[1995] 81 Taxman 517 (Cal.) [Para 8], CIT v. Excel Industries Ltd. [1980] 122 ITR 995 /4 Taxman 89 (Bom.) [Para 8] andSatyadev Chambers (P.) Ltd. v. CIT [1979] 117 ITR 86 (Guj.) [Para 8]. Ms. Anjana Gosain for the Appellant. R.D. Jolly and Rajiv Awasthi for the Respondent. ORDER Arijit Pasayat, C.J. - At the instance of assessee following question has been referred for opinion of this Court by the Income-tax Appellate Tribunal, Delhi Bench 'E' ('the Tribunal') under section 256(1) of the Income-tax Act, 1961 ('the Act') : "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the expenditure of Rs. 19.89 lakhs was a capital expenditure as it gave the assessee an advantage of enduring nature ?" Dispute relates to…

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