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2018 (4) TMI 126 - AT - Income TaxNature of expenditure on leased premises for office use - expenditure on fixtures like partitions, false roofing, glass and minor civil works - Revenue or capital expenditure - proof of asset of enduring nature - Held that:- The assessee has taken three properties on rent but expenditure incurred during the relevant financial year is only on two properties i.e. one at Ameerpet, which was taken on lease for 5 years and the other one at Pune which was taken on lease for a period of 33 months. Therefore, the expenditure incurred on false ceiling as well as partition, glass etc., cannot be held to be creating any asset of an enduring nature. Any expenditure incurred by the assessee, for making the premises suitable for carrying on its business, according to its own standard has been held to be revenue in nature in a number of cases. Hon'ble Delhi High Court in the case of CIT vs. M/s. Hi Line Pens Pvt Ltd [2008 (9) TMI 25 - HIGH COURT DELHI] had considered similar expenditure incurred towards false ceiling, fixing tiles, replacing glasses, wooden partitions, replacement of electric wiring, earthing, replacement of GI pipes etc., and after taking note of all the judicial precedents on the issue as well as the applicability of Explanation (1) to section 32(i) of the I.T. Act has held that the expenditure incurred to make its premises taken on lease, so as to make the premises usable for business activities, is revenue in nature. Admittedly, in the case before us also, the expenditure incurred has been on the premises which have been taken on lease for a period of 5 years to 33 months only. Therefore, we are satisfied that there is no asset of enduring nature created and the assessee is entitled to claim it as revenue expenditure. - Decided in favour of assessee.
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