TMI Blog2016 (2) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... the fire occurred long back in the year 2002 and even after the said occurrence and damage, the assessee has proved that it has continued to give Studio No.3 on hire and earned income. That very fact shows that the Studio No.3 was not completely damaged by fire. Hence, we are of the view that there is merit in the submissions of the assessee that the expenditure of ₹ 35.37 lakh was incurred only to preserve Studio No.3 by carrying out repair works. Further, no material was brought on record by the assessing officer to show that the assessee has built any new asset by incurring this expenditure. Under these set of facts we are of the view that the expenditure incurred by the assessee should be allowed as revenue expenditure. Accordingly, we set aside the order of ld. CIT(A) on this issue and direct the AO to delete the disallowance.- Decided in favour of assessee Disallowance of road repairs expenses - Held that:- . We notice that the assessee is holding an area of 512 acres of land and it is submitted that there is huge stretch of road therein. We notice that the assessing officer has not brought any material to show that the assessee has built any new road. According to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laimed the interest on accrual basis, i.e., it did not pay the interest. The AO took the view that the above said interest expenditure is not allowable as per the provisions of section 43B of the Act. Accordingly, he disallowed the same. The ld. CIT(A) also confirmed the same. 5. The ld. Counsel appearing for the assessee submitted that the provisions of section 43B of the Act shall apply only in respect of loans taken from Public Financial Institutions, State Financial Corporation or State Industrial Investment Corporation. All the above Institutions have been defined in Explanation 4 to Section 43B of the Act. The ld. Counsel submitted that MMRDA is a Statutory Body of Government of Maharashtra and it does not fall under any of the categories stated in sec. 43B of the Act. He submitted that the term Public Financial Institution as defined in section 4A of the Companies Act, 1956 is required to be seen for the purposes of sec. 43B of the Income tax Act. Inviting our attention to sec. 4A of the Companies Act, the Ld A.R submitted that MMRDA will not fall under any of the categories specified in sec. 4A of the Act. He further submitted that MMRDA has been established under a se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A) has confirmed the addition, inter alia, holding that the provisions of sec. 43B shall be applicable to the impugned interest, since the same is payable to a Government Company. The assessee has submitted that MMRDA has been formed under the provisions of Mumbai Metropolitan Region Development Authority Act, 1974 and further, as per the provisions of Section 3 of the above said Act MMRDA shall be deemed to be a local authority within the meaning of the term local authority as defined in the Bombay General Act, 1904. 9. It is well settled proposition of law that the provisions of statute should be interpreted strictly and hence the provisions of sec. 43B of the Act can be applied only if the interest claim is hit by the said provision. Hence, what is required to be seen is as to whether MMRDA shall fall under the category of Public Financial Institutions, Schedule Bank, State Financial Corporation or State Industrial Investment Corporation. If it does not fall in any of the above said categories, then the provisions of sec. 43B cannot be applied to the impugned interest payment. We further agree with the contentions of Ld A.R, that there is no estoppel against the law and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure of revenue expenditure and the same should be allowed in full. 12. On the contrary, the ld. DR placed reliance on the orders of authorities below. 13. Having heard the rival contentions, we are of the view that there is merit in the submissions made by the ld.AR. There is no dispute with regard to the fact that the fire occurred long back in the year 2002 and even after the said occurrence and damage, the assessee has proved that it has continued to give Studio No.3 on hire and earned income. That very fact shows that the Studio No.3 was not completely damaged by fire. Hence, we are of the view that there is merit in the submissions of the assessee that the expenditure of ₹ 35.37 lakh was incurred only to preserve Studio No.3 by carrying out repair works. Further, no material was brought on record by the assessing officer to show that the assessee has built any new asset by incurring this expenditure. Under these set of facts we are of the view that the expenditure incurred by the assessee should be allowed as revenue expenditure. Accordingly, we set aside the order of ld. CIT(A) on this issue and direct the AO to delete the disallowance. 14. The next issue relates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re and Another (224 ITR 414 (SC). 18. We have heard the rival contentions and perused the record. We notice that the assessee is holding an area of 512 acres of land and it is submitted that there is huge stretch of road therein. We notice that the assessing officer has not brought any material to show that the assessee has built any new road. According to the assessee, it has incurred expenditure to re-surface the existing roads. Hence it is a case of maintenance of existing asset, in which case, the same is allowable as revenue expenditure. Hence the decisions relied upon by Ld CIT(A) are not applicable to the facts of the instant case. Though the ld.CIT(A) has taken the view that the expenditure incurred by the assessee would give benefit of enduring nature, yet the very fact that the assessee is required to incur expenditure every year to maintain the road of huge stretch shows that the assessee is not enjoying enduring benefit. Further, it is a known fact that the roads are damaged by wear and tear by passage of time and also due to rain. Further, it is stated that, during the course of film shooting also roads are damaged to erect temporary structure and also due to usage ..... 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