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TMI Blog2012 (6) TMI 288X X X X Extracts X X X X X X X X Extracts X X X X ..... sed by the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar (hereinafter referred to as "the Tribunal") in ITA No. 320/ASR/2000, for the assessment year 1995-96, claiming the following substantial questions of law:- "(i) Whether the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar is right in confirming the action of the ld. CIT(A) adopting the value of the land at Rs. 330/- per sq. yard as against Rs.60/- per sq. yard applied by the Assessing Officer in view of the allotment made by the Improvement Trust, Bathinda in the year 1981-82 in respect of adjoining land? (ii) Whether the Hon'ble Bench is right in treating the demolishing charges and repair expenses as revenue expenditure when no business activity was carried out af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f capital gains at Rs. 330/- per square yard as on 1.4.1981 and thereby reduced the addition to Rs. 62,160/- by allowing the relief to the tune of Rs. 8,39,160/-to the assessee. The CIT(A) also deleted additions of Rs. 3,31,645/-and Rs. 2,13,094/- made under the heads "Demolition Charges" and "Repair of Building", respectively. Being dissatisfied, the revenue preferred an appeal before the Tribunal who vide order dated 13.6.2005 upheld the order of the CIT(A) and dismissed the appeal. Hence, the present appeal by the revenue. 4. We have heard learned counsel for the parties. 5. The appeal raises two issues. First issue relates to the valuation of the plot as on 1.4.1981 and secondly, whether the expenses incurred as "demolition charges" a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Mill was not insured. The total cost of the repair and purchase of new machinery was around Rs.2 crores which the company could not arrange. To receive the funds the company decided to sell some land of the company. For this purpose land measuring 1200 sq. yards was sold facing Amrik Singh Road, Bathinda for Rs. 13,23,000/- on which capital gain was computed at Rs. 2,35,000/- and the cost of land indexation was calculated at Rs. 350/- per sq. yard. The A.O. made the enquiry as regards the land and it was submitted that the valuer of the Govt. had estimated the cost of the land at Samrat Hotel, Bathinda at Rs.300/- per sq. yard as on 1.4.1981. There was price hike in the value of real estate in 1980-81 and, therefore, considering it indexa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s transaction of sale of land by the Improvement Trust on 1.6.1981 and other comparable sale instances had accepted the fair market value of the land at Rs. 330/- per square yard as on 1.4.1981. Learned counsel for the revenue was unable to point out any error in the aforesaid finding which may warrant interference by this Court. 8. Now adverting to the second issue, the Tribunal had accepted that the "demolition charges" and the "repair expenses" incurred by the assessee were revenue in nature. In this regard, the findings recorded by the Tribunal in paras 9 and 12 of its order are to the following effect:- "9. The CIT(A) on the above issues has observed that it is factually position that the mill premises caught fire on 23.7.1994 and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact that the mill of the assessee caught fire is not disputed. It is also not in dispute that due to fire the assessee has to carry out the repair of the demolished portion and has to make repairs in the premises to carry out the business activity. The expenditure spent by the assessee on these items would clearly prove that these were mainly with current repair for the replacement of the demolished portion and as such the assessee has not generated any capital in this way. The expenditure are made only for the purpose of replacement of the demolished items for the re-start of the business activity of the assessee. As a result, the expenditure were rightly allowed to be revenue in nature. We accordingly confirm the order of the CIT(A) on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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