1. The first ground in this appeal is against the disallowance of expenditure of Rs. 52,982 in respect of planting of trees in avenues in the industrial estate. The ITO disallowed the same as capital expenditure which was upheld on appeal by the Commissioner (Appeals).
The learned counsel for the assessee submitted that the expenditure incurred did not result in the creation of any asset and it did not derive any benefit of enduring nature. Hence, it should be allowed as revenue expenditure. The learned departmental representative justified the disallowance.
2. We have considered the rival submissions. In our view, by incurring the expenditure of Rs. 52,982 on planting of trees in avenues in the industrial estate, no income-yielding asset has been created nor any benefit of enduring nature has been derived. By planting trees, a better atmosphere and look is given to the industrial estate. But, thereby, it cannot be held that an enduring benefit has been derived by the assessee. Even the test of enduring benefit is not a certain or conclusive test as held by the Supreme Court in Empire Jute Co. Ltd. v.CIT  124 ITR 1. The Supreme Court pointed out that even if expenditure is incurred for obtaining an advantage of enduring benefit, there may be cases where the expenditure may nonetheless be on revenue account and the test of enduring benefit may break down. What is material to consider is the nature of the advantage in a commercial sense and it is only where the advantage is in the capital field that the expenditure would be disallowable on application of this test. The above ratio squarely applies to the instant case. No income-yielding capital asset has been created by planting trees and no enduring benefit has been derived by the assessee. Thus, the expenditure incurred is allowable as revenue expenditure. Accordingly, we allow the same and delete the addition of Rs. 52,982.
3. Ground No. 2 relating to expenditure on land survey is not pressed.
Accordingly, it is dismissed.