TMI Blog2016 (11) TMI 943X X X X Extracts X X X X X X X X Extracts X X X X ..... emanating from the order of the learned Commissioner of Income-tax (Appeals)-Alwar dated March 14, 2013. The appellant has raised the following ground : The learned Assessing Officer has erred in making an addition of ₹ 10,68,756 on account of disallowance of repair of machinery expenses treating as expense of capital nature of ₹ 12,57,360 after allowing depreciation of ₹ 1,88,604 and the Commissioner of Income-tax (Appeals) has erred in confirming the action of the Assessing Officer. 2. Facts in brief as emerged from the corresponding assessment order passed under section 143(3) dated December 23, 2010, were that the assessee in individual capacity is in the business of grit manufacturing . On verification of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account of current repairs to plant and machinery are allowable as deduction and such amounts cannot include any expenditure in the nature of capital expenditure. For example, the crusher is a machinery which comprises a number of metal plates and expenditure on repair or replacement of broken or worn out metal plates could qualify a current repairs but the expenditure on purchase of a new crusher would not constitute current repairs. The expenditure on replacement of a crusher, conveyor granulator, etc., would in fact be in the nature of capital expenditure since it involves substitution of an old machinery/asset by a new asset, having a long life, which would provide advantage of an enduring nature. The authorised representative ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , would amount to revenue expenditure. In fact the issue in the case of the appellant is the allowability of expenditure claimed as current repairs under section 31(i) of the Act. In this regard, the decision of the hon'ble Supreme Court of India, in the case of CIT v. Saravana Spinning Mills P. Ltd. [2007] 293 ITR 201 (SC) is quite relevant. 4. On this trivial single issue I have heard both the sides. The basic question is that whether a new plant and machinery was purchased by the assessee which could be termed as a new independent capital asset. However, from the details furnished as well as a copy of the invoice placed on record on page 12 of the paper book it appears that the purchases were in the nature of jaw crusher, v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rts purchased could not be used independently but they were simply a part of the plant used for the production. Whenever any part of the existing plant and machinery gets worn out then it is required to be replaced. Such replacement is nothing but a revenue expenditure. Reliance was placed on the decision of CIT v. Udaipur Distillary Co. Ltd. (No. 3) [2004] 268 ITR 451 (Raj). Few more decisions have also been cited, namely, CIT v. Coimbatore Alcohol and Chemicals Ltd. [2008] 296 ITR 356 (Mad) etc. but keeping brevity in mind, need not to be discussed in detail. As far as the decision of CIT v. Saravana Spinning Mills P. Ltd. [2007] 293 ITR 201 (SC) is concerned, as stated by the learned Commissioner of Income-tax (Appeals), a relevant fact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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