Regent Oil Co Ltd v. Strick (Inspector of Taxes); Regent Oil Co Ltd v Inland Revenue Commissioners
[1965] 3 All ER 174(Judgment by: Lord Morris of Borth-Y-Gest)
Between:
And:
Judges:
Lord Reid
Lord Morris of Borth-Y-GestLord Pearce
Lord Upjohn
Lord Wilberforce
Subject References:
TAXATION
Deduction in computing profits
INCOME TAX
Deduction in computing profits
Capital expenditure
Premiums on grant of leases
Oil company
Tied service stations
Lease of premises to oil company for premium
Sub-lease back to proprietor at nominal rent
Covenants binding proprietor to use company's oil
Deductibility of premium in computing company's profits
PROFITS TAX
Computation of profits
Deduction
Capital expenditure
Premiums on grant of leases
Oil company
Tied service stations
Lease of premises to oil company for premium
Sub-lease back to proprietor at nominal rent
Covenants binding proprietor to use company's oil
Deductibility of premium in computing company's profits
Legislative References:
Income Tax Act, 1952 (15 & 16 Geo 6 & 1 Eliz 2. c 10) - s 137(f)
Case References:
Addie (Robert) & Sons' Collieries Ltd v Inland Revenue Comrs - [1924] SC 231; 8 Tax Cas 671; 28 Digest (Repl) 125, 348
Anglo-Persian Oil Co v Dale - [1931] All ER Rep 725; [1932] 1 KB 124; 100 LJKB 504; 145 LT 529; 16 Tax Cas 253; 28 Digest (Repl) 117, 449
Bolam (Inspector of Taxes) v Regent Oil Co Ltd - (1956) 37 Tax Cas 56; 28 Digest (Repl) 124, 479
British Insulated and Helsby Cables v Atherton - [1925] All ER Rep 623; [1926] AC 205; 95 LJKB 336; 134 LT 289; 28 Digest (Repl) 133, 499
Collins v Adamson (Joseph) & Co Adamson (Joseph) & Co v Collins - [1937] 4 All ER 236; [1938] 1 KB 477; 107 LJKB 121; 21 Tax Cas 400; 28 Digest (Repl) 120 463
Comr of Taxes v Nchanga Consolidated Copper Mines Ltd - [1964] 1 All ER 208; [1964] AC 948; [1964] 2 WLR 339
Inland Revenue Comrs v British Salmson Aero Engines Ltd, British Salmson Aero Engines v Inland Revenue Comrs - [1938] 3 All ER 283; [1938] 2 KB 482; 107 LJKB 648; 159 LT 147; 22 Tax Cas 29; 28 Digest (Repl) 120, 461
Inland Revenue Comrs v Coia - [1959] SC 89; 38 Tax Cas 334; 3rd Digest Supp
Kauri Timber Co Ltd v Taxes Comr - [1913] AC 771; 109 LT 22; 28 Digest (Repl) 114, 330
Knight (Inspector of Taxes) v Calder Grove Estates - (1954) 35 Tax Cas 447; 28 Digest (Repl) 58, 225
MacTaggart (Inspector of Taxes) v Strump - [1925] SC 599; 10 Tax Cas 17; 28 Digest (Repl) 126, 367
Hallstroms Proprietary v Federal Comr of Taxation - (1946) 72 CLR 634
Henriksen v Grafton Hotel Ltd - [1942] 1 All ER 678; [1942] 2 KB 184; 111 LJKB 497; 167 LT 39; 24 Tax Cas 453; 28 Digest (Repl) 116, 437
Hinton v Maden & Ireland Ltd - [1959] 3 All ER 356; [1959] 1 WLR 875; 38 Tax Cas 391; 52 R & IT 688
Inland Revenue Comrs v Adam - [1928] SC 738; 14 Tax Cas 34; 28 Digest (Repl) 126, 370
New State Areas v Comr for Inland Revenue - [1946] SALR 610
Ounsworth v Vickers Ltd - [1915] 3 KB 267; 84 LJKB 2036; 113 LT 865; 6 Tax Cas 671; 28 Digest (Repl) 118, 454
Rhodesia Railways v Bechuanaland Protectorate, Resident Comr & Treasurer - [1933] AC 362; 102 LJPC 62; 149 LT 1; 28 Digest (Repl) 405, 907
Roke (HJ) Ltd v Inland Revenue Comrs, Inland Revenue Comrs v Rorke (HJ) Ltd - [1960] 3 All ER 359; [1960] 1 WLR 1132; 39 Tax Cas 194
Smith (John) & Son v Moore - [1921] 2 AC 13; 90 LJPC 149; 125 LT 481; 12 Tax Cas 266; 28 Digest (Repl) 421, 1860
Stow Bardolph Gravel Co v Poole - [1954] 3 All ER 637; [1954] 1 WLR 1503; 35 Tax Cas 459; 28 Digest (Repl) 123, 476
Sun Newspapers Ltd v Federal Comr of Taxation - (1938) 61 CLR 337
United Steel Companies Ltd v Cullington (Inspector of Taxes) (No 1) - (1939) 162 LT 23; 23 Tax Cas 71; 28 Digest (Repl) 29, 129
Usher's Wiltshire Brewery Ltd v Bruce - [1915] AC 433; 84 LJKB 417; 112 LT 651; 6 Tax Cas 399; 28 Digest (Repl) 77, 293
Vallambrosa Rubber Co Ltd v Farmer (Surveyor of Taxes) - [1910] SC 519; 5 Tax Cas 529; 28 Digest (Repl) 105, 281
Van den Berghs v Clark - [1935] All ER Rep 874; [1935] AC 431; 104 LJKB 345; 153 LT 171; 19 Tax Cas 390; 28 Digest (Repl) 117, 450
Whimster & Co v Inland Revenue Comrs - [1926] SC 20; 12 Tax Cas 813; 28 Digest (Repl) 424, 944
Yarmouth v France - (1887) 19 QBD 647; 57 LJQB 7; 34 Digest (Repl) 299, 2159
Judgment date: 27 July 1965
Judgment by:
Lord Morris of Borth-Y-Gest
My Lords, on the facts as found in the Special Case I consider that the lump sum payments which were made by the taxpayers were of a capital and not of a revenue nature. I am of this opinion for two reasons. The first is that each payment was made as the price of acquiring an interest in land which was an asset of a capital nature. The leases were granted to and accepted by the taxpayers on the basis that there would be sub-leases to the lessors and that in the sub-leases there would be covenants which obliged the lessors to obtain all their supplies of petrol from the taxpayers. There were other covenants, such as those which compelled the lessors to carry on business or to bring it about that an assignee would likewise be compelled and would obtain all his supplies from the taxpayers. The circumstance that in taking a lease and in granting a sub-lease the concern of the taxpayers was to secure a purchaser for the petrol which they, as wholesalers, wished to sell, does not alter the fact that there was a real, and not a sham, transaction under which in return for the payment of a sum of money (it matters not whether it be called a lump sum payment or a price or a premium) a lease of land for a period of years (at a nominal rent) was obtained. The leases were of considerable value to the taxpayers because they (the taxpayers) were as a result enabled to grant sub-leases containing the covenants which for trade reasons they were anxious to obtain. Provisions in regard to forfeiture gave a measure of security to the taxpayers.
I agree with the view expressed by the learned judge and by the Court of Appeal that the taxpayers acquired interests in land and that such interests were of a capital nature: I agree also that in the circumstances of the present case the payments made to acquire those interests must be regarded as being payments of a capital nature. The fact that the payments were agreed on after calculations made by reference to estimated gallonage does not alter the fact that they were lump sum payments in order to acquire interests in land which, though they were only to endure for periods of years, should be regarded as capital assets. The fact that the "lease-sub-lease" arrangements made by the taxpayers were few in number as compared with other arrangements which were comparably motivated I regard as irrelevant.
I also arrive at the conclusion that the payments were of a capital nature for a second reason. It is one which I understand does not commend itself to the majority of your lordships. In the Case Stated it is said:
"At the end and as a result of the two transactions of lease and sub-lease, which were firmly linked together, Regent had paid a sum of money for a valuable right, namely the exclusive right to have its oil sold at the station for a given period."
If in a business sense each "lease-sub-lease" arrangement is to be regarded as the method whereby for a lump sum payment the taxpayers acquired an exclusive right to a dealer's custom for five years or for ten years or for twenty-one years, then I consider that such lump sum payment was of a capital, and not of a revenue, nature. I agree with Lord Denning MR when he said ([1964] 3 All ER at p 26):
"The company say to the retailer 'We will pay you £5,000 if you will sell our products exclusively at this point for five years' or ten or twenty-one, as the case may be. The company make a payment once and for all. In return they get an advantage which is of enduring benefit to the company. It brings in revenue to the company week after week, and month after month, from the petrol they supply to the retailer. I have no doubt this advantage is a capital asset and the payment for it is capital expenditure."
The facts recounted in the Case Stated show that in recent years the large suppliers of petrol, being impelled by the stern thrust of competition, have felt obliged to secure exclusive outlets for their petrol. In what has been called the "exclusivity war" there have been arrangements of varying nature. For the purposes of the present case it will suffice to examine the nature of a payment made if there were acceptance by a garage owner of an offer expressed in some such terms as "if we pay you £5,000 will you promise to obtain all your petrol from us for the next five years?". The payment would, in my view, be of a capital nature.
In arriving at this conclusion no recourse can be had to statutory definition for such there is not. The decided cases, carefully marshalled in argument, show that, in the diverse and varying sets of circumstances in which decision has been called for whether payments have been of capital or of revenue nature, no all embracing formula has been evolved. No touchstone has been devised. Where definition is lacking, then description must do its best. In giving the judgment of the Privy Council in Comr of Taxes v Nchanga Consolidated Copper Mines Ltd ([1964] 1 All ER at p 212; [1964] AC at p 959) Viscount Radcliffe, in referring to phrases used in earlier cases, said that it had to be remembered that they were "essentially descriptive rather than definitive". The decided cases are to be scanned because they contain pointers and mention factors and give indications and provide descriptions. Care must, however, be taken not to take phrases which are uttered in relation to particular facts and then to promote them to be of universal application. In some cases payments can by general assent be recognised at once as being either of capital or of revenue nature. Where dispute arises a court must do its best to assess the value and the weight of all the particular features which may point to one conclusion or the other and, in doing so, to have in mind the legal image which a wealth of judicial utterance reveals.
In this approach there must be a measure of reluctance in referring to some only of the decided cases, lest it be thought that the guidance afforded by others is being neglected. The well known words of Viscount Cave LC in his speech in British Insulated and Helsby Cables v Atherton ([1925] All ER Rep at p 629; [1926] AC at p 213) are perhaps so often quoted because in a single sentence reference is made to a number of features or attributes. Some of these may be valuable as pointers some of the time, provided it is not assumed that all are useful all the time. It may in some cases be of some significance that a payment is made "once and for all". This thought was earlier expressed by the Lord President (Lord Dunedin) in Vallambrosa Rubber Co Ltd v Farmer (Surveyor of Taxes) ((1910), 5 Tax Cas at p 536) when he said that
"in a rough way [the words denote that he was speaking in general terms] I think it is not a bad criterion of what is capital expenditure as against what is income expenditure-to say that capital expenditure is a thing that is going to be spent once and for all, and income expenditure is a thing that is going to recur every year."
The notion of a payment being made "once and for all" may perhaps in some cases suggest the payment of the price of something of a capital nature, but like any other individual phrase it must be of only limited application and helpfulness. It must be remembered also, as Lord Dunedin pointed out in the Vallambrosa case ((1910), 5 Tax Cas at p 534) that it would be wrong to say that each year must be taken absolutely by itself and that nothing could ever be deducted as an expense unless it was purely and solely referable to a profit reaped within the year. The necessary annual outgoing to cover the necessary annual weeding of a rubber estate would seem essentially to be of the nature of a revenue outgoing.
It may further be of some significance, as Viscount Cave pointed out ([1925] All ER Rep at p 629; [1926] AC at p 213), if as a result of a payment, something is brought into existence which is an "asset or an advantage" and if it is "for the enduring benefit of a trade".
The process of description as opposed to that of definition may sometimes be aided by noting contrasts. There is a difference between a business entity, structure or organisation set up or established for the earning of profit and the process by which such an organisation operates to obtain regular returns by means of regular outlay. There is a difference between the profit yielding subject and the process of operating it. There is a difference between the instrument for earning profits and the continuous process of its use or employment for that purpose. These contrasts were noted in 1938 by Dixon J in his judgment in Sun Newspapers Ltd v Federal Comr of Taxation ((1938), 61 CLR 337 at p 359). In much the same way in 1946 in his judgment in Hallstroms Proprietary Ltd v Federal Comr of Taxation ((1946) 72 CLR 634 at p 647) Dixon J distinguished between the acquisition of the means of production and the use of them: between establishing or extending a business organisation and carrying on the business: between the implements employed in work and the regular performance of the work in which they are employed: between an enterprise itself and the sustained effort of those engaged in it. In his judgment in that case Starke J ((1946), 72 CLR at p 644) while emphasising that none of the so called definitions or tests or any other definitions or tests suggested by the cases are decisive, pointed out that an asset or advantage need not have a tangible existence and expressed the view that expenditure to acquire the goodwill of a business or to acquire restrictive covenants against competition in business may be of a capital nature. In agreement with what was said by Starke J I consider that no different result is reached according as to whether an asset or advantage is of a tangible or of an intangible nature.
The contrast has been observed between expenditure forming "part of the cost of improving or adding to the income-earning plant or machinery" and "part of the cost of performing the income earning operations" (see New State Areas Ltd v Comr for Inland Revenue ([1946] SALR 610 at pp 620, 621)). An analogous contrast may be that between plant, on the one hand, and stock in trade, on the other. In his speech in Hinton v Maden & Ireland Ltd ([1959] 3 All ER at pp 362, 363), Lord Reid said that the word "plant" might have a more or less extensive meaning according to its context but that as a general statement of its meaning he would adopt the words of Lindley LJ in Yarmouth v France ((1887), 19 QBD 647 at p 658):
"... in its ordinary sense, it includes whatever apparatus is used by a business man for carrying on his business, not his stock-in-trade which he buys or makes for sale; but all goods and chattels, fixed or moveable, live or or dead, which he keeps for permanent employment in his business ..."
In like manner it can be said that there is a difference between money spent in creating or acquiring a source of profit and money spent in working it.
In the Nchanga case ([1964] 1 All ER at p 212; [1964] AC at p 960) Lord Radcliffe said that
"... courts have stressed the importance of observing a demarcation between the cost of creating, acquiring or enlarging the permanent (which does not mean perpetual) structure of which the income is to be the produce or fruit and the cost of earning that income itself or performing the income earning operations."
In Robert Addie & Sons' Collieries Ltd v Inland Revenue Comrs ((1924), 8 Tax Cas 671 at p 676) the Lord President (Lord Clyde) posed the question: Are the sums in question
"part of the company's working expenses?-is it expenditure laid out as part of the process of profit earning?-or, on the other hand, is it capital outlay?-is it expenditure necessary for the acquisition of property or of rights of a permanent character, the possession of which is a condition of carrying on its trade at all?"
The contrast so noted was referred to in deciding the case of Inland Revenue Comrs v Adam. In that case a carting contractor found it expedient for the purposes of his business to acquire a site for the deposit of waste soil removed from building foundations. He achieved his purpose, without purchasing the site, by means of a contract with the owner of the site. He was given the right (and he undertook the obligation) to deposit soil on a defined area at a stated rate per annum for a period of eight years. For the right he agreed to pay the owner the sum of £3,200 payable in "instalments" ("to account thereof in advance") of £200 each in June and December of each year. It was held that the £3,200 was a payment for a capital asset and that no deduction by reference to it was admissible for income tax purposes. The lump sum of £3,200 though payable by instalments over a period of eight years was of a capital nature. In his judgment the Lord President, (Lord Clyde) said ((1928), 14 Tax Cas at p 41):
"A great deal has been said about form and substance. I think that, in a question of this sort, both form and substance must be considered; because the form of the transaction by which the respondent acquired the right to dump waste soil may bear very materially on the question of the capital or revenue character of the outlay made to acquire it. Suppose that the consideration for the right had been an annual rent of the site stipulated for as such, it would, I think, have been difficult to displace the view that the rent was a proper revenue charge. But (the contract taking the form it does) it is equally difficult to put out of view the fact that the consideration is not a rent but a capital price."
In a case in which the nature from the retailer's point of view of a money payment received by a retailer for a tie was being considered (Inland Revenue Comrs v Coia ((1959), 38 Tax Cas 334 at p 339)) the Lord President (Lord Clyde) said that it was "as the consideration for his giving up his freedom of trading and changing the structure of this part of his business". Lord Patrick said ((1959), 38 Tax Cas at p 339) that
"he parted with what I regard as a valuable asset of a capital nature, the right to obtain the supplies of fuel oils which were his stock-in-trade from such sources as he might consider most suited to the varying nature of the demands made by his customers."
Lord Mackintosh said ((1959), 38 Tax Cas at p 340) that the tie plainly
"affected the overall structure of Mr. Coia's garage business. He became henceforth for a ten-year period tied to ... for all his supplies instead of being at liberty from 1953 onwards to buy and sell all the particular brands of motor fuel which were then on the market."
The decision in Bolam (Inspector of Taxes) v Regent Oil Co Ltd has not been assailed by the Crown. That case differs from the present ones if the payments in that case can be regarded as having been rebates or discounts made in reference to the amount of petrol sold to the retailers in each year. In his judgment the learned judge (Danckwerts J), said ((1956), 37 Tax Cas at p 68):
"It seems to me that there would have been no doubt if the payments had been made by reference to the amount of petrol sold to the retailers in each year; it would plainly have been expenditure, particularly if paid in the form of a rebate, which was expended by the Regent Oil Co in the course of its trade in the making of its profits. Does it make a difference because in the circumstances of the case there has to be some lump sum fixed which is paid to secure the same result, and even if payment is made in advance for several years?"
In examining the nature of the payments which were made and which are in issue in this case it is important to consider not so much why the payments were made but for what they were made. If the motive in making payments is noted or becomes manifest the more relevant inquiry must be made as to whether some asset or advantage was acquired and, if so, what was its nature. It is said that the taxpayers, as a matter of hard business necessity, were forced, in the instances now being considered, to do what they did. Their rivals and competitors would or might have made "lease-sub-lease" arrangements with the particular garage owners had the taxpayers, somewhat reluctantly, not acted as they did. So also it is said that "tie" arrangements had become a necessity for the petrol selling companies and had become a regular and customary part of the pattern of business arrangements. Accordingly, so the argument runs, the payments made were reasonably to be classified as being selling or marketing costs and as such to be regarded as of revenue nature. My lords, in my view the conclusion does not follow from the premise. The fact that a payment must in prudence be made does not show that it is of income rather than of capital nature. Nor is the inquiry in any way advanced by saying that a payment was necessarily made in the course of the process of marketing or was made in conformity with the accepted or customary pattern of trading. It is common ground that the sums of money now under consideration were expended wholly and exclusively for the purposes of the taxpayers' trade. It can also be taken for granted that all sums that the taxpayers spent in the course of marketing were spent because they considered that it was necessary to spend such sums in order to help them to sell their petrol; but to call such sums marketing costs is merely to apply a neutral or generic description which in no way distinguishes between payments of a capital nature and payments of a revenue nature. Some marketing costs are of the one kind and some are of the other. It may become imperative for the purpose of effecting sales to acquire a building which is to be used solely for such purpose: the cost of acquiring the building would not be an expense of a revenue nature. What falls to be considered is the nature of that for which payment has been made. In the selling side of their business the taxpayers were marching in step with their competitors and had to embark on much expenditure. In one sense all of it was a selling or marketing expense. It all took place in the hope and the expectation that sales would be induced. Some of it however would be of a capital nature and some of a revenue nature. The important consideration is the character of the advantage which, by the expenditure, it is sought to obtain (see Dixon J in Sun Newspapers Ltd v Federal Comr of Taxation ((1938), 61 CLR at p 363)).
In considering the nature of a payment it may well be relevant to know whether similar payments will recur, and whether the payment is but one of a number of periodic payments. Here again it becomes important to consider what it is that the items of payment will produce. Some capital assets may last but a short time.
They do not for that reason lose their character as capital assets. If they are much needed, so that a succession of them must be obtained, there will be periodic or constantly recurring payments of money. Yet each of these payments will be of a capital nature. If the nature of that is acquired makes it a capital asset the payment for it will be a capital payment. If tangible assets (such as the knives or lasts in Hinton v Maden & Ireland Ltd) are clearly capital assets, then the payments for them are capital payments, even if the useful life of the assets is shorter than the length of an accounting period.
The fact that there are payments seemingly of the same nature which appear to be recurrent may be a circumstance to be examined in deciding the nature of the payments. If in a business a particular capital asset must be acquired, then the fact that in a similar but larger business many of such capital assets will be needed will be an immaterial circumstance. So also will it be immaterial whether a number of such capital assets are bought all at one time or whether they are bought over a period of time. Their character as capital assets will not change if many are bought rather than few, or if they are periodically bought and periodically paid for. The fact of recurrences of payments will be of no consequence: nor will recurrences of orders. Similarly if for the purposes of some manufacturing process articles are purchased which are to be worked on in a factory, so that when fashioned and altered they will be finished products which are then to be for sale, the sums paid to purchase such articles will have a revenue nature which will not change even if, instead of there being successive or periodic purchases, there are occasional purchases of large quantities.
If a tie of the nature that I am examining is properly to be regarded as an asset of a capital nature, and if the payment made for it is to be regarded likewise, then I cannot think that these conclusions are altered or affected by the circumstance that some thousands of ties may be acquired.
Although a court must not be deluded if, by the mere form of a transaction, its substance is masked or shrouded, there are some transactions which may be done either in one way or in another way and in which form may denote and point to substance. There may well be a difference between a case where a lump sum payment is made to acquire the right to occupy premises for a period of, say, twenty-one years and a case where by contract a right is acquired to occupy premises for twenty-one years with an obligation to make periodic payments for such right to occupy. In the latter case the periodic payments (being periodic payments for the use of premises) would probably be payments of a revenue nature. In such a case the right itself to go on occupying the premises (subject to making the periodic payments or subject to conditions) might be or become of considerable value. It would be a capital asset-but as no lump sum price would have been paid for it there would be no payment of a capital nature: there would be no payment calling for any inquiry.
Aided by the word pictures or descriptions of a capital asset which the decided cases contain I consider that a tie of the kind now being examined is a capital asset. If a lump sum is paid for such a tie for five years (or for a lesser number of years), it would give a false and unreal picture if the whole sum were debited to the profit and loss account for the first year or for the year in which the payment was made. If it is said to be hard that no part of the lump sum can be a debit in the profit and loss account, that is merely to voice a regret that there is no statutory provision which enables periodic allowances to be made. That however is not a matter for the courts.
If regard is had to the language of metaphor which is found in some of the cases, a tie would seem to appertain to the "structure" of the selling organisation or income-earning machine of the taxpayers. If it is argued that a tie for a shorter period than a year may seem to possess the same nature as a tie for a longer period, I think that it can be said that a tie for a period of less than a year (being a right which so to speak evaporates within the year) is so closely linked with the selling operations during that year that it becomes different in nature and does not qualify to attain "the dignity of a capital asset" (see Henriksen v Grafton Hotel Ltd). In that case it was held that payments in respect of the monopoly value payable on the grant of a licence of a period of three years were of a capital nature. Du Parcq LJ said ([1942] 1 All ER at p 684; [1942] 2 KB at p 196) that "the right to trade for three years as a licensed victualler must be regarded as attaining the dignity of a capital asset". Lord Greene MR said ([1942] 1 All ER at p 682; [1942] 2 KB at p 192):
"A payment of this character appears to me to fall into the same class as the payment of a premium on the grant of a lease which is admittedly not deductible. In the case of such a premium it is nothing to the point to say that the parties, if they had chosen, might have suppressed the premium and made a corresponding increase in the rent. No doubt they might have done so, but they did not do so in fact. The lessee purchases the term for the premium. There is no revenue quality in a payment made to acquire such an asset as a term of years."
The taxpayers were doubtless reluctant to have to incur the expense of purchasing a number of ties, but they saw no alternative. They felt obliged, on certain sites, to purchase an "umbrella" within and under the protection of which they could conduct their selling operations for a period of years. Further to vary the metaphor, they felt obliged to purchase a "tree" which would live for a period of years: its "produce or fruit" would be the orders that would result year by year during the period.
If the taxpayers had paid a sum of money to a rival company or to rival companies, ie, to one or more of the other big petrol selling wholesalers, in exchange for promises that it or they would not over a period of years sell petrol to a particular retailer, such payments would I consider be of a capital nature (compare United Steel Companies Ltd v Cullington (Inspector of Taxes) (No 1), Collins v Joseph Adamson & Co, and Sun Newspapers Ltd v Federal Comr of Taxation). The position must surely be the same if instead of the payment being made to the rivals it is made to the retailer. (I enter into no consideration of any contentions not now relevant that might possibly be raised in regard to any such arrangements.)
For the reasons that I have indicated I consider that the payments were of a capital nature. I would dismiss the appeals.