Commissioner Of Income-Tax v. G.E Capital Services Ltd.

C.M No. 8353 of 2007 (Exemption)

1. Allowed, subject to all just exceptions.

2. CM stands disposed of.

I.T.A No. 560 of 2007

3. The Revenue is aggrieved by an order dated August 25, 2006, passed by the Income-tax Appellate Tribunal, Delhi Bench “C” in I.T.A Nos. 2038, 2528 and 2529.Delhi/2002 relevant to the assessment years 1995-96 to 1997-98.

4. The only question that has arisen in this case pertaining to the assessment year 1997-98 is that the expenditure incurred by the assessee on software was treated by the Assessing Officer as capital expenditure.

5. The Tribunal was of the view that due to technological changes and the need to upgrade the software on a regular basis it cannot be said that the software was of an enduring nature.

6. We are informed that the software for which the expenditure was incurred was MS Office, which is not a custom built software for the assessee and it is common knowledge that this software requires regular upgradation.

7. We can understand that where customised software is prepared, then it could be of an enduring nature, but in this case MS Office is not customised software and it cannot be said that the software does not require frequent upgradation.

8. We are of the view that there is no error committed by the Tribunal in taking the view that it did.

9. No substantial question of law arises. Dismissed.