1. Leave granted.
2. The short question which arises for consideration is as to whether the proportionate lease rent paid by the mining lessee for acquiring leasehold right for extracting minerals from mineral bearing land would be a capital expenditure or a revenue expenditure.
3. Having heard learned Counsel for the parties and having considered the decisions of this Court in Pingle Industries Ltd. v. CIT , Gotan Lime Syndicate v. CIT and Aditya Minerals (P) Ltd. v. CIT , we are of the opinion that the distinction lies between a case where royalty or rent is being paid on the one hand and where the entire amount of lease is paid either at a time or in instalments. Whereas in the former case it would be a revenue expenditure and in the latter it would be a capital expenditure. In this view of the matter, we are of the opinion that this is not a case where High Court should have interfered with the order of the Tribunal. The High Court was thus right to dismiss the appeal of the appellant.
The appeal is dismissed accordingly.