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TMI Blog2003 (3) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... llation of overhead cleaner, speed frames and humidification plant is capital expenditure (sic)?" - By the assessee: "Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that the expenditure incurred in replacing the blow room machinery is not deductible as a revenue expenditure?" - The question referred at the instance of the Revenue is answered in favo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal was correct in holding that the expenditure incurred in replacing the blow room machinery is not deductible as a revenue expenditure?" The machineries installed are overhead cleaner, speed frames and humidification plant. The order of the Assessing Officer does not give much information about the nature of the machineries. The Commissioner has held that the overhead cleaner was installed wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T v. Shri Rani Lakshmi Ginning Spinning and Weaving Mills Ltd. [2002] 256 ITR 592, held that expenditure on replacement of worn out speed frames does not fall within the capital field, but is an expenditure which has to be allowed as revenue expenditure. The finding of the Tribunal, which upheld the view of the Commissioner that such expenditure has to be treated as revenue expenditure, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner that it is a new item of machinery which did not exist in the factory earlier and it is not replacement. The expenditure in these circum stances is clearly in the capital field and the Tribunal is right in having held that the expenditure incurred on blow room machinery is expenditure in the capital field. The question referred at the instance of the Revenue is answered in favour of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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