The main legal point established in the judgment is that the expenditure incurred for the construction of a road, which conferred an enduring advantage for the benefit of the business, was considered a revenue expenditure and entitled the assessee to a deduction under the Income-tax Act, 1961.

( 1 ) IN these three references which have been made under Section 256 (1) of the Income-tax act, 1961 ('the Act'), the following questions of law arise for consideration : at the instance of the assessee : whether on the facts and in the circumstances of the case, the Tribunal was right in holding that a sum of Rs. 3,61,236/- contributed towards the cost of construction of road is not an admissible deduction in computing the business income? at the instance of the Department : 1) Whether on the facts and in the circumstances of the case, the Tribunal was right in law in upholding the commissioner (Appeals) order who held that tbe depreciation has to be allowed on increase in value of assets due to fluctuation in exchange rate? 2) Whether on the facts and in the circumstances of the case, the Tribunal was right in law in allowing a sum of rs. 75,600/- paid as filing fee as 'revenue expenditure' ? 3) Whether on the facts and in the circumstances of the case, the Appellate tribunal was right in law in upholding that order of Commissioner (Appeals) who held that the sum of Rs. 1,66,184/- being development and commissioning expenses should be treated as revenue expenditure? 4) Whether on the facts and in the circumstances of the case the Appellate tribunal was right in holding that the income-tax Officer was not justified in restricting the relief u/s 80j on prorata basis?

( 2 ) I shall, at first, answer the four questions referred at the instance of the Revenue. (i) The first question is covered by the decision of this Court against the revenue in C. I. T. v MICO Ltd. , i. T. R. C. Nos. 178 to 180 of 1979, disposed of on 12-2-1986, and is, therefore, answered in the affirmative and against the Revenue; (ii) The second question relates to the expenditure incurred by way of remitting filing fee to the Registrar of companies in respect of enhancement of the authorised share capital of the company. Following the view taken by the Himachal Pradesh High Court in mohan Meakin Breweries Ltd. , v C. I. T. (117 ITR 505), the appellate Assistant commissioner disallowed the claim. The Tribunal followed the view taken by the Madras High Court in C. I. T. v kishanchand (130 ITR 385) and allowed it as a revenue expenditure. In coming to the conclusion, the Madras high Court had applied the ratio enunciated by the Supreme Court in, india Cements v C. I. T. (60 ITR 52 ). I am in respectful agreement with the view expressed by the Madras High court. Accordingly, I answer the second question in the affirmative and against the Revenue. (iii) The third question is covered by the decision of this Court in C. I. T. v M/s hindustan Machine Tools, I. T. R. C. No. 295 of 1979, disposed of on 2-12- 1987, against the Revenue and is, therefore, answered in the affirmative and against the Revenue; (iv) The fourth question is covered by the decision of this Court in C. I. T. v mysore Petro Chemicals (145 ITR 416) against the Revenue and is, therefore, answered in the affirmative and against the Revenue.

( 3 ) I now proceed to consider the question referred to us at the instance of the assessee, which is, whether the Tribunal was right in holding that a sum of Rs. 3,61,236/- contributed by the assessee towards part of the cost of construction of road not belonging to it is not an admissible deduction in computing its business income.

( 4 ) THE material facts of these cases are set out below : m/s Hindustan Machine Tools Limited, which is a Public Sector undertaking, is the assessee company common to all the three cases. The assessee company together with m/s Bharat Electronics Limited and the Bangalore Development Authority made its individual contribution of a sum of rs. 3,61,236/- for the construction of the road linking Hebbal and Jalahalli where the h. M. T. Units I and II are located. The contribution of Rs. 3,61,236/- made by the assessee company was at the instance of the karnataka Government. The assessee claimed that the said contributio