TMI Blog1982 (7) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... actories at Bombay and Ahmedabad. By lease deed dated March 7,1969, the assessee-company took one shed on lease which was situated on a part of plot No. 100 of Rakhiyal Town Planning Scheme in Ahmedabad District. The lease was for a period of 11 months and 29 days. One of the terms of the lease was that the assessee-lessee was entitled to keep or install machinery or furniture and fixtures permanently in the shed leased out, and the assessee was entitled to make permanent alterations and additions in the shed. Assessee was entitled to put windows in the shed. The assessee was also entitled to fix sanitary fittings, electrical fittings, air conditioning, partition cabins and such other works as desired by the assessee but any alterations or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tures. Buildwell Corporation entered into an agreement with the assessee-company according to which the assessee agreed to give vacant possession of the premises occupied by it for which the assessee was to obtain a total carpet area of 1,920 sq. ft. on the third floor of the new building to be constructed, on a payment of a concessional price of only Rs. 3,003 on ownership basis. The agreement specifically referred to the fact that the concessional price was fixed in view of the ready co-operation given by the assessee in giving vacant possession and also in view of the inconvenience that would be suffered by the assessee. The ITO took the market price of the area in the new building at Rs. 98,000 and brought Rs. 95,000 to tax as capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the repairs were intended to provide the necessary facilities for carrying on the business, then the expenditure incurred for putting the sheds in usable state must be treated as wholly and exclusively incurred for the purpose of business. Merely because a brick wall has been constructed or cement plaster has been put on the walls, the assessee cannot be said to have acquired any asset of an enduring character. It has to be remembered that the assessee is not the owner of the sheds. The agreement between the assessee and the lessor is that the assessee was entitled to remove the fittings at the time of handing over vacant possession to the lessor. If the terms of the lease are strictly complied with, the walls will have to be demolished, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me within the scope of s. 10(2)(ii) of the Indian I.T. Act, 1922, but such a claim can be allowed under the general cl. (xv) of s. 10(2). That was a case in which repairs were carried out to the roof of the premises which became necessary for protecting its machinery from rain and wind and the expenses were allowed as properly deductible under s. 10(2)(xv) of the Indian I.T. Act, 1922. In Girdhari Dass and Sons v. CIT [1976] 105 ITR 339, a Division Bench of the Allahabad High Court pointed out that if a tenant incurs an expenditure on a rented building for its renovation or alteration, he does not acquire any capital asset because the building does not belong to him and ordinarily such expenditure will be of a revenue nature. In that case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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