9911796707
TMI Blog2000 (2) TMI 844X X X X Extracts X X X X X X X X Extracts X X X X ..... ns in the form of replacing roof, new columns, demolition of old walls as revenue expenditure, without appreciating the facts and the circumstances on which the findings of Assessing Officer in the assessment order treating the said huge amount of repairs as capital expenditure was based and is well supported in the decided cases of M/s. Humayun Property Ltd. v. CIT [1962] 44 ITR 73 (Cal.)." 3. The assessee-firm is a tenant of a property belonging to M/s. Bombay Cotton Mills Estate (P.) Ltd. at Kalachowki, Bombay. The total built-up area in the possession of the assessee was 5,200 sq. ft. It was being used for carrying on the warehousing business of the assessee. The premises were owned and in the year of account relevant for the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 75,000 Approximately. ₹ 7,86,000 Approximately. The details of the work done are contained in the scope of work. (page 15 of the Compilation). The major portion of the work was done by Vishal Construction Co. The total cost of the work was ₹ 7,85,866. This was accordingly written off in the accounts as Repairs and Maintenance." The further details said to have been enclosed with the compilation filed before the CIT (Appeals) and placed at page 15 have not been filed before us. 4. A copy of the deed under which the premises were sub-leased to Dena Bank has been filed before us and this indenture is dated 18-4-1993. The deed under which the assessee-firm obtained the said premises from M/s. Bombay Cotton Mills Estate ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r is a capital expenditure which is in the nature of investment for enduring benefits. Assessee has received substantial gain in his rental income. From ₹ 18,000 annual rental income, assessee will be receiving ₹ 5,76,000 annual rental income in future. It clearly shows that the renovation is in the nature of enduring benefit. Hence, I disallow the sum of ₹ 7,85,866 debited as repair and maintenance in the P & L Account and consider the same as a capital expenditure." The CIT (Appeals), however, allowed the contention of the assessee that the expenditure in question is of a revenue nature on the ground that the assessee-firm had only undertaken repair work and as it did not own the premises but only held them as leas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... following decisions :- (1) Empire Jute Co. Ltd. v. CIT [1980] 124 ITR 11 (SC); (2) CIT v. Chowgule & Co. (P.) Ltd. [1995] 214 ITR 5232 (Bom.); (3) Standard Mills Co. Ltd. v. CIT [1990] 181 ITR 233 (Bom.); (4) CIT v. Oxford University Press [1977] 108 ITR 166 (Bom.); (5) Dewar's Garage (India) (P.) Ltd.'s (supra); (6) CIT v. Bharat Suryodaya Mills Co. Ltd. [1993] 202 ITR 942 (Guj.); (7) CIT v. Cominco Binani Zinc Ltd. [1993] 204 ITR 56 (Cal.); (8) CIT v. N.P. Singh [1994] 207 ITR 183 (Pat.); (9) CIT v. Associated Cement Companies Ltd. [1988] 172 ITR 257 (SC); (10) CIT v. Excel Industries Ltd. [1980] 122 ITR 9953 (Bom.); (11) National Organic Chemical Industries Ltd. v. CIT [1993] 203 ITR 410 (Bom.). 7. We have perused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he details are as follows :- Financial Year Income 1983-84 ₹ 66,000 1984-85 ₹ 43,000 1985-86 ₹ 18,000 1986-87 ₹ 18,000. He has also filed copies of the profit and loss account of the assessee for the above four years and we find that the total expenditure debited in the profit and loss account was as follows :- Financial Year Expenditure 1983-84 ₹ 25,260 1984-85 ₹ 17,500 1985-86 ₹ 15,088 1986-87 ₹ 23,571. The book profits distributed among the four partners in the above years were as follows : Financial Year Amount 1983-84 ₹ 40,740 1984-85 ₹ 25,500 1985-86 ₹ 2,912 1986-87 ₹ 5,571 (Loss). 8. In the light of the above factual position, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ature of repairs. On the other hand, it partook of the nature of the remodelling, renovation and reconstruction. The issue, to our mind, is squarely covered, as contended by the learned DR, by the decision of the jurisdictional High Court in the case of Vasant Screens (supra ). In this case, the assessee converted a godown into a cinema theatre just like the assessee-firm in the present case has converted the premises from a warehouse to a bank. The learned counsel for the assessee sought to distinguish the case considered by the Hon'ble Bombay High Court on the ground that in that case the premises are owned by the assessee, whereas in the present case, they are held on lease. This contention, of course, goes contrary to the earlier stand ..... X X X X Extracts X X X X X X X X Extracts X X X X
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