IN THE HIGH COURT OF DELHI AT NEW DELHI 
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   ITA 1165/2011  
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 CIT            ..... Appellant 
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 Through Mr. Sanjeev Sabharwal, Adv. 
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 versus 
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 IFFCO TOKIO GENERAL INSURANCE CO LTD..... Respondent 
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 Through 
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 CORAM: 
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 HON'BLE MR. JUSTICE SANJIV KHANNA 
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 HON'BLE MR. JUSTICE R.V.EASWAR 
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 O R D E R 
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      21.10.2011 
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 Whether a particular expense is a capital expense or a revenue 
 expense normally is a mixed question of law and facts. However, we are 
 not inclined to issue notice in this appeal under Section 260A of the 
 Income Tax Act, 1961 (Act, for short) because the Assessing Officer in 
 his order dated 30th September, 2008 passed under Section 143(3) read 
 with Section 147 of the Act has not dealt with the factual background of 
 the case at all. The discussion in the order reads as under:- 
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 ?2. During the course of assessment proceedings, it is observed 
 that deduction of Rs.1,24,39,896/- (by way of information and technology 
 expenses) on account of computerization expenses were allowed as revenue 
 expenditure whereas computerization expenses give an advantage of 
 enduring benefit to the assessee. The assessee was, therefore, asked to 
 explain why it should not be added back. The assessee?s representative 
 attended and submitted as below:- 
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 ?The IT expenses of Rs.1,24,39,896/- have been incurred at head office as 
 also at various branches. ?    Nature of expenses are as under:- 
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 . Call Centre charges 
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 . Software Maintenance 
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 . Post Warranty Maintenance 
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 . DR Sit Prof charges 
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 . Lease line 
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 . Licence Fee Fire Wall 
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 . Access Control 
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 . MS Office licence. 
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 All the expenses incurred are of revenue nature which have 
 correctly been debited to IT expenses and examined during the assessment 
 proceedings u/s 143(3) by the then Assessing Authority.? 
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 The assessee?s argument is not acceptable the information and 
 technology expenses are of capital nature. Accordingly, the sum of 
 Rs.1,24,39,896/- is disallowed and added to the total income.? 
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 In the said factual background, we do not see any reason to 
 interfere with the findings recorded by the CIT (Appeals) which have been 
 affirmed by the ITAT as the Assessing Officer did not make any base or 
 foundation in his order. The appeal is accordingly dismissed. 
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 SANJIV KHANNA, J. 
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 R.V.EASWAR, J. 
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 OCTOBER 21, 2011 
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 NA 
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 27 
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