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TMI Blog2016 (1) TMI 413X X X X Extracts X X X X X X X X Extracts X X X X ..... . Further, on the aspect of life of the membrane, nothing is referred to by the A.O. nor by C.I.T. (Appeals) that earlier, such aspect, namely, life of the membrane spread over from 3 to 5 years was not considered or it had missed or otherwise. We find no infirmity in the order of CIT(A) and accordingly delete the addition and in the alternative allow the cost of remembraining in membrance cell-II as revenue expenditure. Decided in favour of the Assessee. - ITA No. 2551/Ahd/2012 - - - Dated:- 19-11-2015 - Shri Kul Bharat, JM, Manish Borad, AM. For The Appellant : Shri Sanjay Agrawal, CIT,DR For The Respondent : Shri Sunil Talati, AR ORDER PER Manish Borad, Accountant Member. This appeal of Revenue is directe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. During assessment proceedings Assessing Officer observed that assessee has claimed replacement cost of remembraning in membrance cell-II, Baroda amounting to ₹ 7,18,67,080/-. Looking to the nature and volume of expenditure and life of the component ranging between 3 to 5 years, Assessing Officer deemed it fit to treat this expenditure of ₹ 7,18,67,080/- as capital expenditure and accordingly after allowing depreciation of ₹ 2,51,53,478/- from the total cost of remembraining in membrance cell-II at ₹ 7,18,67,080/- added ₹ 4,67,13,601/- (Rs. 7,18,67,080/- (-) ₹ 2,51,53,478/-) to the income of the assessee. Aggrieved, assessee went in appeal before CIT(A) who deleted the addition made by Assessing Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction of CIT(A) in deleting the addition of Rs. ₹ 4,67,13,601/- made on account of disallowance of expenditure for replacement cost of remembraining in membrance cell-III. 7. The above issue came up before the Tribunal in assessee s own case for Asst. Year 2003-04 wherein the Co-ordinate Bench decided the issue in favour of assessee on the basis that Assessing Officer has himself allowed the claim of assessee in Asst. Years 1993-94 and 1995-96. 8. Further similar issue in assessee s own case has been decided in assessee s favour by Hon ble Jurisdictional High Court in Tax Appeal Nos.798 799 of 2010 wherein vide order dated 19/01/2015, Hon ble Court has elaborately discussed the issue along with application of facts in assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowability of deductions for repairs to the extent provided for in Sections 30 to 36. To decide the applicability of Section 31(i) the test is not whether the expenditure is revenue or capital in nature, which test has been wrongly applied by the High Court, but whether the expenditure is current repairs . The basic test to find out as to what would constitute current repairs is that the expenditure must have been incurred to preserve and maintain an already existing asset, and the object of the expenditure must not be to bring a new asset into existence or to obtain a new advantage. After observing the aforesaid, when the Apex Court further examined the facts of the said case, it was found that each machine including the Ring Frame ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diture revenue in nature while no change of facts and circumstances have been pointed out on behalf of the Revenue in the years under consideration, we are of the opinion that the AO is not justified in departing from his previous decision in the AY 1993-94, in the absence of material circumstances or reasons for such departure. Therefore, ground no.4 in the appeal for the AY 1999- 2000 ground no.2 in the AY 2000-01 are allowed. 10. If the observations are further considered in light of the abovereferred decision of the Apex Court in case of Excel Industries Ltd. (supra), we do not find that the approach on the part of the department to take up a different stand in absence of any material or valid reason could be said as justified. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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