1967 (5) TMI 4

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..... I. JUDGMENT The judgment of the court was delivered by SHAH J.-- The respondent, hereinafter called " the assesse ", carries on the business of manufacture and sale of cotton yarn. In the previous year relevant to the assessment year 1956-57, the assessee spent Rs. 93,215 for introduction of " Casablanca conversion system " in its spinning plant. Substantially, this involved replacement of certain roller stands and fluted rollers fitted with rubber aprons to the spinning machinery, removal of ring-frames from certain existing parts, introduction, inter alia, of ball-bearing jockey-pulleys for converting the original band-drivers to tape-drivers and other additions and alterations in the drafting mechanism. The Income-tax Offic .....

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..... he High Court of Judicature at Madras : " (1) Whether, on the facts and in the circumstances of the case, the Tribunal had jurisdiction to decide whether the sum of Rs. 93,215 constituted an allowable item of expenditure under section 10(2)(v) of the Act ? (2) Whether, on the facts and in the circumstances of the case, the sum of Rs. 93,215 or any portion thereof is allowable as an expenditure incurred for current repairs under section 10(2)(v) of the Act ?" The High Court accepted the finding recorded by the Tribunal that by the introduction of the Casablanca conversion system no new machinery or plant was installed but the introduction of the system amounted " to fitting of improved versions of certain minor parts " and expenditu .....

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..... ether of law or of fact which relate to the assessment of the assessee may be raised before the Tribunal : If for reasons recorded by the departmental authorities in rejecting a contention raised by the assessee, grant of relief to him on another ground is justified, it would be open to the departmental authorities and the Tribunal, and indeed they would be under a duty, to grant that relief. The right of the assessee to relief is not restricted to the plea raised by him. The Tribunal in the present case was of the opinion that in order to adjust the tax liability of the assessee, it was necessary to ascertain the true nature of the Casablanca conversion system. The assessee had, it is true, contended that the introduction of the Casabla .....

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