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Issues Involved:
1. Whether the sum of Rs. 30,557 is rightly claimable as a deduction allowable under section 10(2)(v) of the Indian Income-tax Act. 2. If not, whether the expenditure of Rs. 30,557 was an allowable deduction under section 10(2)(xv) of the Indian Income-tax Act. Issue-wise Detailed Analysis: 1. Deduction under Section 10(2)(v) of the Indian Income-tax Act: The primary issue was whether the expenditure of Rs. 30,557 for replacing certain parts in 646 looms could be claimed as a deduction under section 10(2)(v) of the Indian Income-tax Act. The assessee argued that the parts replaced were essential for maintaining the looms' functionality and that the expenditure should be considered as "current repairs." The Tribunal had previously disallowed this deduction, reasoning that the expenditure did not fall under "current repairs" as it was incurred after a lapse of 60 years. The Tribunal's view was that such expenditure was of a capital nature and not frequent enough to be considered as "current repairs." The High Court examined the meaning of "current repairs" in detail. It was emphasized that the term "repairs" should be understood in contradistinction to "renewal" or "restoration." Repairs are meant to preserve and maintain an already existing asset without bringing a new asset into existence or obtaining a new advantage. The term "current" implies that repairs are attended to as and when the need arises and are not allowed to accumulate. The Court rejected the Tribunal's reasoning that the expenditure was not "current" due to the long interval since the last repair. It was noted that the need for repairs arose only after 60 years, and the expenditure was necessary to maintain the looms' functionality. The Court emphasized that the timing of the need for repairs should be determined by commercial expediency rather than an arbitrary timeframe. The Court concluded that the expenditure of Rs. 30,557 was indeed for "current repairs" as it was meant to preserve and maintain the existing looms without creating a new asset or advantage. Therefore, the deduction was allowable under section 10(2)(v). 2. Deduction under Section 10(2)(xv) of the Indian Income-tax Act: The second issue was whether the expenditure could be claimed under section 10(2)(xv) if it was not allowable under section 10(2)(v). This section allows deductions for any expenditure not being in the nature of capital expenditure or personal expenses, laid out wholly and exclusively for the purposes of the business. The Court noted that since section 10(2)(xv) was amended in 1953, no deduction is permissible under this section if it falls within any of the clauses (i) to (xiv). Given that the expenditure was already considered under section 10(2)(v), the Court did not find it necessary to decide on its admissibility under section 10(2)(xv). Conclusion: The High Court answered the first question in the affirmative, allowing the deduction of Rs. 30,557 under section 10(2)(v) of the Indian Income-tax Act. The second question was deemed unnecessary to address, and thus, it was stated that it does not arise. The Commissioner was ordered to pay the costs.
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