TMI Blog2017 (2) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... eams, roofs, etc., in its original position, which had become dangerous and unsafe for the workmen and hindered the normal operation of the business, was not controverted by the Departmental representative nor had any evidence to the contrary been produced before the Tribunal or the authorities below. Accordingly, we are of the view that the assessee had incurred the said expenditure only to preserve and maintain the existing asset and that the expenditure was not of a nature which brought into being a new asset or created a new advantage of an enduring nature. Consequently, the expenditure is revenue in nature and has to allow as deduction. We allow the claim and reverse the orders of the lower authorities. - Decided in favour of asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounting to ₹ 13,88,212/- and ₹ 35,71,814/-, respectively. The AO from the details of expenses incurred in repairs and renovation of building noted that the same is capital expenditure and expenses incurred gives enduring benefit to the assessee. The AO recorded the fact that the assessee is in rented property, whereas assessee is the owner of the property. By going through the quantum and nature of expenditure and also going through the details, noted that indeed this is capital expenditure and he allowed the depreciation on the same. The AO capitalized this expenditure of ₹ 49,60,053/- and allowed depreciation. Aggrieved assessee preferred appeal before CIT(A) who also confirmed the action of the AO by observing in Par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erecting scaffolding for the purpose etc. A close look at the invoice clearly shows that the aforesaid expenses were not at all in the nature of 'current repairs' but were incurred for extensively repairing and restoring the structure of the building. Even the appellant in its written submissions dated 27.01.2015 has admitted that die said building was completely damaged and, therefore, it required extensive repairs and rehabilitation and that the expenditure incurred by it was 117 the nature of replacement of the existing asset. 5.3.2 It is well-established that the expression current repairs means expenditure on building etc. which is not for the purpose of renewal or restoration but which is only for the purpose of pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch brought enduring advantage or benefit to it can by no stretch of imagination be allowed as current repairs u/s.30(a)(ll) of the Act. In view of the above discussion, I do not find any error or infirmity in the action of the A.O. in treating the impugned expenditure amounting to ₹ 4960,053/- as capital expenditure and allowing depreciation thereon @10% to the appellant. The diaIIowance of remaining amount of ₹ 44,64048/- made by the A.O. (after allowing depreciation of ₹ 4,96,005/-) is thus upheld. Ground No.2 taken up by the appellant is found to be devoid of merit and is accordingly dismissed. Aggrieved, assessee came in second appeal before Tribunal. 4. We have heard rival contentions and gone through the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he part of bigger plant. Therefore, it would be treated as replacement of those parts when they are not used independently and the expenditure would be liable to deduction under Section 37(1). Similarly, Hon ble Gujarat High Court in the case of CIT Vs. Udaipur Distillery Co. Ltd. 268 ITR 451(Guj), wherein it was held that purchase of transformers in replacement of existing transformer, which could not be used independently, falls within the category of revenue expenditure and hence, is an allowable deduction under Section 37(1) of the Act. These expenditures are, thus, treated as Revenue expenditure. 5. We find that in the present case the expenditure was incurred on repairs, reinforcement, replacement of dilapidated beams, pillars, wal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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