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TMI Blog2014 (8) TMI 460X X X X Extracts X X X X X X X X Extracts X X X X ..... bring a new asset into existence or to obtain a new advantage - elaborating on the provisions of Section 31 of the Act and Section 37 of the Act, the Authority has to pass an order on the impact of replaced materials on the business as well as functioning of the machinery after replacement to result in the higher productivity or not – thus, the order of the Tribunal is set aside and the matter is remitted back to the AO for fresh consideration on replacement of machinery – Decided in favour of Revenue. - Tax Case (Appeals). Nos. 259, 318, 390 and 448 of 2014 - - - Dated:- 6-8-2014 - R. Sudhakar And G. M. Akbar Ali,JJ. For the Appellant : Mr. M. Swaminathan Standing Counsel for Income Tax Dept. For the Respondents : Mr. R. Siva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of 'conventional drafting system' is revenue expenditure and not capital expenditure. Challenging the same, the Revenue has preferred the above Tax Case (Appeals) raising the following substantial question of law: Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the expenditure incurred by the assessee in replacing machineries and introducing 'compact spinning system' in the place of 'conventional drafting system' is revenue expenditure allowable under section 37 of the Income Tax Act? . 4. Both sides agree that the issue raised in these Tax Case (Appeals) is covered by a decision of this Court dated 08.04.2014 in T.C.(A)Nos.826 and 827 of 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as well as functioning of the machinery after replacement to result in the higher productivity or not. In the instant case, the Tribunal directed the Assessing Officer to find out as to whether the machinery that was replaced by the assessee resulted in an impact of increased productivity. The Assessing Officer was directed to ascertain what was the machinery that was replaced by the assessee and to consider the claim of the assessee as falling under revenue or capital. 9. Having gone through the order of the Tribunal, we have no hesitation in confirming the order of the Tribunal in remitting the matter back to the Assessing Officer to ascertain the facts in respect of replaced machinery whether it was auto-coner, comber and lap former ..... X X X X Extracts X X X X X X X X Extracts X X X X
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