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TMI Blog2014 (2) TMI 1340X X X X Extracts X X X X X X X X Extracts X X X X ..... for the first time for starting cancer unit during the impugned year and earlier the patients were making their own arrangements for meals. The system adopted by the assessee that during the period of admission no separate charges for food were billed and the same were inclusive in the package/room rent. One half meal or tea is taken at ₹ 80 and ₹ 30 on the day of discharge. The Ld. CIT(A) has rightly scrutinized the bills which were also before the AO and has rightly come to the conclusion that no addition can be made by the AO - Decided in against the revenue. - I.T.A. Nos.217 & 218/Asr/2013, C.O. No.22/Asr/2013 - - - Dated:- 24-2-2014 - SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER For the Appellant : Sh.Tarsem Lal, DR For the Respondent : Sh.Y.K.Sud, CA ORDER PER BENCH ; These two appeals of the Revenue arise from two different orders of CIT(A), Jalandhar, each dated 01.02.2013 for the assessment years 1008-09 2009-10. The assessee has also filed cross objections for the assessment year 2009-10. 2. In ITA No.217(Asr)/2013 A.Y.2008-09, the Revenue has raised following grounds of appeal: On the facts and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts are made to M/s. Hotel Centre Paint, on the basis of bills raised by them. The AO asked for details of corresponding bills raised on patients. In reply, it was stated means provided to patients on 16.05.2007 and the assessee s and no separate record was maintained. It was also explained that means were provided to patients as per recommendations of the dietician and no separate record was maintained. It was also found that this charge is not separately billed. When the AO found that these charges are not included in the bills she further asked the assessee as to how the bills raised by the hotel were verified when there was no separate record? When there is a canteen in the hospital premises why some bills of M/s. Hotel Centrepoint is related to tea-bills? The justification for claiming expenses when these are not recovered from patients? It was explained by the assessee that these charges are included in the room rents hence no extra or separate payment is taken. The assessee also produced certain bills to show that till the time room rent is charged no separate charges for food are mentioned and the meal is only charged when the room rent is not charged i.e. the last day of ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on record. We are convinced with the arguments made by the ld. counsel for the assessee that the additional evidences in the form of indoor patients register and attendance record of doctors at conference and other relevant registers were produced. The register for indoor patients, which is a vital record, has to be maintained by the hospital and the ld. CIT(A) has rightly admitted the additional evidences. These expenses claimed by the assessee have been incurred for the first time for starting cancer unit during the impugned year and earlier the patients were making their own arrangements for meals. The system adopted by the assessee that during the period of admission no separate charges for food were billed and the same were inclusive in the package/room rent. One half meal or tea is taken at ₹ 80 and ₹ 30 on the day of discharge. The Ld. CIT(A) has rightly scrutinized the bills which were also before the AO and has rightly come to the conclusion that no addition can be made by the AO and accordingly, we find no infirmity in deleting such addition made on ad-hoc basis for the reasons that the AO at least accepts that actually such expenses have been incurred and no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The assessee was asked to explain why not these bills be treated as capital in nature. In this regard the assessee has filed reply dated 25.08.2011 stating that all these expense are repair and replacement of spares for the equipments already purchased and capitalized initially and charged accordingly to repair and maintenance account details in this regard are as under: A UPS for ₹ 43,118/- purchased vide bill no.6248 from Power Guard Systems Chandigarh and replaced in Dialyses machine/ Water Flow PCB for ₹ 92126/- have been replaced to a cancer equipment named Linear Accelerator vide bill M/s. Siemens Ltd. New Delhi. PCB Assay Control Board have been replaced to a cancer equipment named Linear Accelarator vide bill M/s. Siemens Ltd. New Delhi. Dura x-ray tube of ₹ 19,75,000/- purchased from Siemens Ltd. New Delhi vide B. No.596728100596801 dated 05.06.2010 on account of repair replacement of Dura x-ray tube for CT Scanner. The life of this is 200000 seconds and after that it has to be replaced, so accordingly we have charged to repair maintenance account. Cardiac probe CW Board for ₹ 2 lac purchased from M/s. Trivition Med. Chennai vide B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal No.154 and 147/09-10/CIT(A)/Jal is reproduced below: 37.7. In the case of CIT vs. Mangayarkarsi Mills (supra), the Hon ble Apex Court also relied on their earlier judgment in the case of Ballimal Naval Kishore vs. CIT 224 ITR 414 (SC). In the case of Billimal Naval Kishore vs. CIT, the issue under consideration was whether the expenditure foe expensive repairs of an exhibition theatre by the assessee constituted current affairs . The assessee had extensively repaired the theatre by spending on machinery, new furniture, sanitary fittings and replacement of electrical wiring. In addition, the assessee had incurred expenditure on extensive repairs to the walls to the hall, to the flooring and roofing, to doors and windows and to the stage sites. etc. The ITO held the expenditure on repairs to walls etc. amounting to ₹ 62,977/- as capital in nature. The AAC affirmed the view taken by the ITO but the Hon ble Tribunal upheld the assessee s case. The Hon ble High Court answered the reference made by the Revenue in favour of the Revenue and against the assessee. On further appeal by the assessee, the Hon ble Apex Court held that the expression current repairs was not mer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 840/-. Copy of the said machinery alongwith its accessories was capitalized as machinery in the year 2004. The assessee has been incurring expenses on its general maintenance. Therefore, this is essential repair which does not bring into existence any asset which can not be capitalized because the asset is CT Scanner and tube is just a part of the scanner and replacement of worn out part of an asset. 17.1 Similarly, UST 5209 for an amount of ₹ 2,00,000/- was purchased from M/s. Trivitron Med. Systems, Chennai, which is a part of a major equipment Color Doppler Ultrasound Scanner purchased from M/s. Advanced Technologies Labs US for USD 53500/- equivalent to ₹ 2594000/- and was capitalized as machinery in the year 2001. Copy of which has been placed on record before the authorities below. Essentially this is also a repair which cannot be capitalized. 17.2 As regards addition of ₹ 43118/- for PGS 3 KVA online UPS, the same was purchased from M/s/ Power Guard System Chandigarh, which is a part of a dialysis machine and is not an independent machine by itself. The Dialysis machine was purchased for ₹ 11,00,000/- from M/s. R.R. Surgico New Delhi, a copy of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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