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TMI Blog2015 (8) TMI 599X X X X Extracts X X X X X X X X Extracts X X X X ..... has raised several grounds in I. T. A. No. 1354/ Mds/2013, effective grounds are the following four grounds : (i) Disallowance of cost of two comber machines claimed as revenue expenditure ; (ii) Disallowance of cost of 339 units of yarn clearers claimed as revenue expenditure ; (iii) Disallowance of cost of one auto coner claimed as revenue expenditure ; and (iv) Charging of interest under sections 234B and 234C of the Act. 3. At the time of hearing, counsel for the assessee submits that except ground No. (ii), the other three grounds are not pressed and may be treated as withdrawn. Therefore, the above ground Nos. (i), (iii) and (iv) relating to disallowance of cost of two comber machines, cost of auto coner and charging of interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccordance with law and in terms of the directions given in the case of CIT v. Ramaraju Surgical Cotton Mills [2007] 294 ITR 328 (SC). Pursuant to the order of the hon'ble Supreme Court, the Commissioner of Income-tax (Appeals) passed order dated March 25, 2013 holding that cost of two comber machines and cost of one auto coner as capital expenditure. The Commissioner of Income-tax (Appeals) also held that cost of 339 units of yarn clearers as capital expenditure which is never a subject matter of dispute. Against the order of the Commissioner of Income-tax (Appeals) the assessee is in appeal before us. So far as the grounds raised in respect of disallowance of cost of two comber machines and one auto coner is concerned, the assessee is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpurities so that the yarn is of uniform thickness and quality. It consists of sensitive electronic parts and the outer cover is made of plastic. The yarn clearers have to be replaced often as they have a tendency to malfunction due to constant usage. During this year, the assessee has purchased 339 electronic yarn clearers, each costing about Rs. 3900. Taking all these points into consideration, the assessee's claim that this is a revenue expenditure is accepted." The Assessing Officer treated the cost of two comber machines and one auto coner as capital expenditure as against the claim of the assessee as revenue expenditure. The assessee carried the matter to the Commissioner of Income-tax (Appeals) and the Commissioner of Income-tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e cost of two comber machines and one auto coner, proceeded to adjudicate that even the cost of 339 units of yarn clearers is capital expenditure, even though the said issue was not before the hon'ble Supreme Court. Since the issue is not arising out of the orders of any of the lower authorities originally is decided by the Commissioner of Income-tax (Appeals) which is not only incorrect but also beyond his jurisdiction. It is a mistake apparent from record also. Thus we modify the order of the Commissioner of Income-tax (Appeals) restricting the disallowance only to cost of two comber machines and one auto coner. Ground No. (ii) raised by the assessee is allowed. 8. Since the Commissioner of Income-tax (Appeals) has no jurisdiction to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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