M/s. Win Medicare Pvt. Ltd., New Delhi V. Addl. CIT, New Delhi

ITA 5025/DEL/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 65929 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2009-2010
• Appeal Filed On: 24-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS MEETA SINH A
• Keywords: Depreciation; Business expenditure

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H NEW DELHI BEFORE SHRI R.P. TOLANI AND SHRI B.C. MEENA ITA NO. 5025/DEL/2012 A.YR. 2009-10 M/S WIN MEDICARE PVT. LTD., VS. ADD. CIT, RANGE-1 8, 1400 MODI TOWER, NEW DELHI. 98, NEHRU PLACE, NEW DELHI. PAN : AAACW0631J ( APPELLANT ) ( RESPONDENT ) APPELLANT BY : SHRI SALIL KAPOOR ADVOCATE RESPONDENT BY : MRS. MEETA SINHA SR. DR O R D E R PER R.P. TOLANI, J.M: : THIS IS ASSESSEES APPEAL AGAINST CIT(A)S ORDER DA TED 27-7-2012. SOLE EFFECTIVE GROUNDS RAISED IS AS UNDER: THE LD. CIT(A) HAS ERRED ON THE FACTS AND CIRCUMST ANCES OF THE CASE AND IN LAW, IN CONFIRMING THE DISALLOWANCE OF RS. 2,09,261/- ON ACCOUNT OF REPAIRS AND MAINTENANCE EX PENDITURE CONSIDERING IT AS CAPITAL IN NATURE. 2. BRIEF FACTS ARE: THE ASSESSEE IS ENGAGED IN THE MANUFACTURE AND SALE OF PHARMACEUTICAL PRODUCTS AND TRADING IN COSMETICS AN D PHARMACEUTICALS. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASS ESSEE FILED COMPLETE DETAILS OF RUNNING AND MAINTENANCE EXPENSES WHICH I NCLUDED COST OF 2 REPLACEMENT OF DEFECTIVE TURBO CHARGER, PVC WIRE, V OLVOLINE OIL & POWER, COMPRESSOR REFRIGEMENT AND MICRO PACKAGE AC, AGGREG ATING TO RS. 2,38,123/-. LOWER AUTHORITIES WERE OF THE VIEW THAT EXPENDITURE ON THESE PARTS WAS CAPITAL IN NATURE AND THEREFORE THESE ITE MS OF EXPENSES WERE HELD TO BE NOT IN THE NATURE OF REPLACEMENT AND MAINTENANCE BUT ASSETS OF ENDURING NATURE. DEPRECIATION OF 15% WAS GIVEN, RESULTING IN DISALLOWANCE OF RS. 2,09,261/-. 3. LD. COUNSEL FOR THE ASSESSEE CONTENDS THAT THE P ARTS ARE CLEARLY REPLACEABLE IN NATURE AND HAVE NO ENDURING BENEFIT AND FALL WITHIN THE CATEGORY OF REPLACEMENT AND MAINTENANCE, ALLOWABLE U/S 31 OF THE ACT. RELIANCE IS PLACED ON CIT VS. ALEMBIC CHEMICAL WORK S 206 ITR 170; CIT VS. ANAND GUM INDUSTRIES 154 ITR 680; AND CIT VS. M AKHAN SARMAH SAVAPANDIT 180 ITR 35. 4. LD. DR SUPPORTED THE ORDER OF LOWER AUTHORITIES. 5. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE ENTIRE MATERIAL AVAILABLE ON RECORD. THE DESCRIPTION OF PARTS MENTI ONED CLEARLY INDICATES THAT THEY ARE REPLACEABLE PARTS OF THE PLANT AND MACHINE RY. LOWER AUTHORITIES WHILE HOLDING THEM TO BE OF ENDURING NATURE HAVE NO T GIVEN ANY REASON FOR THE NATURE OF ITS ENDURANCE. IN VIEW OF THESE FACTS WE ARE INCLINED TO HOLD THAT 3 THE EXPENDITURE ON ITEMS IN QUESTION IS CLEARLY IN THE NATURE OF REPAIR AND MAINTENANCE AND IS ALLOWED AS BUSINESS EXPENDITURE. 6. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 29-11-2012. SD/- SD/- ( B.C. MEENA ) ( R.P. TOLANI ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 29-11-2012. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR 4