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2022 (11) TMI 374 - AT - Income TaxNature of expenses - expenditure towards furniture and maintenance expenditure which includes plywood purchases, hardware items and other carpentry works - revenue or capital expenditure - Assessee claims that the said expenditure is revenue in nature because the same has been incurred for the leased premises for the renovation of the branch office - HELD THAT:- Assessee has filed enough materials including certain judicial proceedings to justify its case, where the Hon’ble High Court of Madras in case of Commissioner of Income Tax-I, Chennai Vs. Armour Consultants Private Limited [2013 (3) TMI 269 - MADRAS HIGH COURT] had considered very similar nature of expenditure like partitions, vinyl flooring and interior decorations for leased premises and held that the said expenditure incurred to make the lease premises workable and functional is revenue in nature. ITAT, Chennai in the case of Redington (India) Limited [2015 (8) TMI 40 - ITAT CHENNAI] held that office cabins, wooden partitions, plastering, water proofing treatment, installation charges, flooring charges, etc for leased premises is current repairs which cannot be considered as capital expenditure which gives enduring benefits to the Assessee. The substance of ratio laid down by various Courts and Tribunals is that, if certain expenditure incurred to make the leasehold premises functional like partitions works, temporary repairs, flooring, etc., then the said expenditure should be allowed as revenue in nature. Therefore, we are of the considered view that the Assessing Officer has completely erred in making addition on furniture and maintenance expenditure as capital in nature. CIT (Appeals) without appreciating the above facts had simply sustained the additions made by the Assessing Officer. Hence, we set aside the order passed by the learned Commissioner of Income Tax (Appeals) and direct the Assessing Officer to delete the addition - Appeal of assessee allowed.
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