TMI Blog2006 (2) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... the generator is revenue expenditure - 2. Whether, on the facts and circumstances of the case, the Tribunal was right in holding that the contribution to the ESI (employees State insurance), 1994, is allowable deduction under section 43B?" - held that the payments towards provident fund and employees State insurance having been made within the grace time allowed under the relevant statute, those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as revenue expenditure and allowed depreciation. The expenditure was treated as capital expenditure. Further the Assessing Officer disallowed the contribution made by the assessee towards ESI on April 21, 1994, on the ground that the same was not made within the previous year and the stipulated time. Aggrieved by the said order, the assessee filed an appeal before the Commissioner of Income-tax (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Whether, on the facts and circumstances of the case, the Tribunal was right in holding that the contribution to the ESI on April 2, 1994, is allowable deduction under section 43B?" The question whether the expenditure on replacement of machinery is capital or revenue is not determined by the treatment given in the books of account or in the balance sheet. The claim has to be determined only b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in the decision cited supra, we hold that the expenditure on remodelling of the generator is revenue expenditure and therefore, the Tribunal was right in allowing the claim of the assessee. With regard to question (2), viz., the Tribunal was right in holding that the contribution to the ESI on April 2, 1994, is allowable deduction under section 43B, this court, in CIT v. Shri Ganapathy Mil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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