GODFREY PHILIPS INDIA LTD, MUMBAI V. ADDL CIT 8(1), MUMBAI

ITA 5317/MUM/2015

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1793 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 10 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-09-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2011-2012
• Appeal Filed On: 10-11-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: CHOUDHARY ARUNKUMAR SINGH
• Keywords: Capital asset; Question of law; Valuation report; Revenue expenditure; Set aside
• Section: 43B; 72

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G, MUMBAI BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI AMARJIT SINGH, JUDICIAL MEMBER ITA NO.5317/M/2015 ASSESSMENT YEAR: 2011-12 M/S. GOD FREY PHILIPS INDIA LTD., SAHARA ROAD, CHAKALA ANDHERI (E), MUMBAI 400 049 PAN: AABCG 4768K VS. ADDL CIT 8(1), AAYAKAR BHAVAN, MUMBAI (APPELLANT) (R ESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI YOGESH THAR, A.R. REVENUE BY : SHRI CHOUDHARY ARUN KUMAR SINGH, D. R. DATE OF HEARING : 18.07.2019 DATE OF PRONOUNCEMENT : 13.09.2019 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 12.08.2015 OF THE COMMISSIO NER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS TH E CIT(A)] RELEVANT TO ASSESSMENT YEAR 2011-12. 2. AT THE TIME OF HEARING, THE GROUND NO.1, 2 & 3 W ERE NOT PRESSED BY THE COUNSEL OF THE ASSESSEE AND THEREFOR E THE SAME ARE DISMISSED AS NOT BEING PRESSED. 3. THE ISSUE RAISED IN GROUND NO.3 IS AGAINST THE C ONFIRMATION OF DISALLOWANCE OF RS.78,12,000/- BY LD. CIT(A) AS MADE BY THE AO UNDER SECTION 43B OF THE ACT ON ACCOUNT OF LEAVE ENCASHMENT EXPENSES CLAIMED BY THE ASSESSEE ON PAYMENT BASIS B Y HOLDING ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 2 THAT ASSESSEE HAS ALREADY CLAIMED THE EXPENSES ON A CCRUAL BASIS IN THE EARLIER ASSESSMENT YEARS. 4. THE FACTS IN BRIEF ARE THAT THE ASSESSEE HAS BEE N CLAIMING THE LEAVE ENCASHMENT ON THE BASIS OF ACTUARIAL VALU ATION BUT AFTER AMENDMENT OF SECTION 43B OF THE ACT, THE CLA IM WAS MADE ON THE PAYMENT BASIS FROM A.Y. 2003-04 ONWARDS. TH E AO DISALLOWED 1/3 RD OF THE TOTAL DEDUCTION CLAIMED OF RS.234.36 LAKHS WHICH COMES TO RS.78,12,000/-. THE SAID ORDER WAS AFFIRMED BY THE LD. CIT(A). 5. THE LD. A.R., AT THE OUTSET, POINTED OUT THAT TH E IDENTICAL ISSUE INVOLVED IN A.Y. 2003-04 IN ITA NO.1079/M.200 7 AND A.Y. 2004-05 IN ITA NO.5569/M/2007 HAS BEEN RESTORED TO THE FILE OF THE AO. THE LD. A.R. PRAYED THAT IN THE PRESENT AP PEAL ALSO THE ISSUE MAY KINDLY BE RESTORED TO THE AO TO BE DECIDE D ON THE SAME LINES AS IN THE EARLIER YEAR. 6. THE LD. D.R., ON THE OTHER HAND, RELIED ON THE O RDER OF AUTHORITIES BELOW. 7. AFTER HEARING BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD, WE OBSERVE THAT THE IDENTICAL ISSUE STANDS DECIDED IN EARLIER YEAR 2003-04 WHEREIN THE ISSUE HAS BEEN RES TORED TO THE FILE OF THE AO TO EXAMINE AND ALLOW THE LEAVE ENCAS HMENT WHICH HAS NOT BEEN CLAIMED IN THE EARLIER YEAR. THE OPER ATIVE PART OF THE DECISION OF CO-ORDINATE BENCH OF THE TRIBUNAL I N ITA NO.1071/M/2007 IS REPRODUCED BELOW: 2.8 THE DISPUTE RAISED IN THE GROUND NO.8 IS REGAR DING DISALLOWANCE OF LEAVE ENCASHMENT EXPENSES. THE AO NOTED THAT THE ASSESSEE HAD BEEN CLAIMING EXPENSES ON ACCOUNT OF LEAVE ENCASHMENT ON THE BASIS OF ACTU ARIAL VALUATION REPORT BUT FROM A.Y.2003-04 THE ASSESSEE STARTED CLAIMING DEDUCTION ON THE ACTUAL PAYMENT BASIS. ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 3 THE AO OBSERVED WHEN THE ASSESSEE HAD MADE CLAIM ON THE BASIS OF ACTUARIAL VALUATION IN THE EARLIER YEAR, THE CLAIM NOW BEING MADE ON THE BASIS OF ACTUAL PAYMENT COULD LEAD TO DOUBLE DEDUCTION. AS PER THE AO THE ASSESSEE WAS NOT ABLE TO FURNISH THE DETAILS OF DOUBLE DEDUCTION. HE THER EFORE PROCEEDED TO MAKE DISALLOWANCE ON ESTIMATE BASIS. IT WAS OBSERVED BY HIM THAT AN EMPLOYEE ON AVERAGE WORKED IN PRIVATE SECTOR FOR 20 - 25 YEARS. SINCE THE ASSESSEE HAD BEEN MAKING CLAIM ON THE BASIS OF ACTUARIAL VALUATION FO R THE LAST 7 YEARS HE ESTIMATED THAT 1/3RD OF ACTUAL PAYMENT MAY HAVE BEEN CLAIMED ON THE BASIS OF ACTUARIAL VALUATION. ACCORDINGLY DISALLOWANCES TO THE EXTENT OF 1/3RD AMOUNTING TO RS.20 LACS AND RS.12.33 LACS RESPECTIVELY FOR THE TWO YEARS. I N APPEAL CIT(A) CONFIRMED THE ORDERS OF AO AGGRIEVED BY WHICH THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 2.8.1 WE HAVE HEARD BOTH THE PARTIES, PERUSED THE R ECORDS AND CONSIDERED THE MATTER CAREFULLY. THE DISPUTE IS REGARDING DISALLOW ANCE OF PART OF THE CLAIM RELATING TO LEAVE ENCASHMENT. THE ASSESSEE HAD BEEN MAKING T HE CLAIM EARLIER ON THE BASIS OF ACTUARIAL VALUATION BUT CONSEQUENT TO THE AMENDM ENT OF SECTION 43B THE CLAIM WAS BEING MADE ON PAYMENT BASIS FROM A.Y.2003-04. T HE AO HAS MADE ESTIMATED DISALLOWANCE OUT OF THE CLAIM MADE ON PAYMENT BASIS ON THE GROUND THAT PART OF THE PAYMENTS MADE MAY RELATE TO EARLIER YEAR WHEN T HESE WERE ALLOWED ON ACTUARIAL BASIS. THE AO HAS MADE DISALLOWANCE ON ES TIMATE WHICH CANNOT BE SUSTAINED. ONLY THE PAYMENT WHICH HAD ACTUALLY BEEN ALLOWED EARLIER CAN BE DISALLOWED. IN OUR VIEW MATTERS REQUIRE FRESH EXAMI NATION AND DISALLOWANCE HAS TO BE RESTRICTED TO THE AMOUNTS ALLOWED IN THE EARLIER YEAR. WE THEREFORE SET ASIDE THE ORDER OF CIT(A) AND RESTORE THE ISSUE TO THE FILE O F AO FOR PASSING A FRESH ORDER AFTER NECESSARY EXAMINATION AND AFTER ALLOWING OPPORTUNIT Y OF HEARING TO THE ASSESSEE. 8. SINCE THE FACTS IN THE PRESENT CASE BEFORE US AR E IDENTICAL TO THE FACTS IN THE CASE AS DECIDED BY CO-ORDINATE BEN CH OF THE TRIBUNAL IN A.Y. 2003-04, WE, THEREFORE, RESPECTFUL LY FOLLOWING THE DECISION OF CO-ORDINATE BENCH OF THE TRIBUNAL R ESTORE THE ISSUE TO THE FILE OF THE AO TO DECIDE THE SAME ON T HE SAME LINES. IN OTHER WORDS TO ALLOW THE CLAIM OF THE ASSESSEE O N ACCOUNT OF LEAVE ENCASHMENT WHICH HAS NOT BEEN CLAIMED IN THE EARLIER YEAR ON THE BASIS OF PROVISIONS CREATED BASED UPON ACTU ARIAL REPORT. CONSEQUENTLY GROUND NO. 3 IS ALLOWED FOR STATISTICA L PURPOSES. 9. THE ISSUE RAISED IN GROUND NO.4 IS AGAINST THE C ONFIRMATION OF ACTION OF AO IN CAPITALIZING THE EXPENSES INCURR ED ON REPAIR AND MAINTENANCE OF BUILDING AMOUNTING TO RS.2,72,25 ,410/- BY LD. CIT(A). ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 4 10. THE FACTS IN BRIEF ARE THAT DURING THE COURSE O F ASSESSMENT PROCEEDINGS, THE AO OBSERVED THAT THE ASSESSEE HAS INCURRED SUBSTANTIAL EXPENDITURE ON REPAIRING THE RENTAL AS WELL AS OWN PREMISES. THE AO OBSERVED THAT THE ASSESSEE INCURRE D EXPENSES OF RS.52,58,076/- ON RENTAL PREMISES, THE DETAILS W HEREOF ARE GIVEN IN PAGE 8 OF THE ASSESSMENT ORDER. SIMILARLY , THE AO OBSERVED THAT THE ASSESSEE HAS INCURRED A SUM OF RS.2,19,67,334/- ON OWN PREMISES, THE DETAILS WHERE OF ARE GIVEN ON PAGE NO.9 OF THE ASSESSMENT ORDER. ACCORDING TO THE ASSESSEE, THE EXPENDITURE WAS INCURRED ON THE ROUTI NE REPAIRS AND MAINTENANCE WHICH HAS NOT RESULTED INTO CREATI ON ON ANY ENDURING BENEFIT OR OF ANY CAPITAL ASSET IN THE HAN DS OF THE ASSESSEE. HOWEVER, ACCORDING TO THE AO, THE ASSESS EE HAS CHANGED THE INTERIOR OF THE BUILDING AND ONLY THE O UTER WALLS REMAINED AS THEY WERE AND THUS CAME TO THE CONCLUSI ON THAT THE ASSESSEE HAS CREATED NEW ASSETS. ACCORDINGLY, THE AO DISALLOWED THE EXPENSES TO THE TUNE OF RS.2,72,25,4 10/- COMPRISING RS.52,58,076/- ON RENTED PREMISES AND RS.2,19,67,334/- ON OWN PREMISES. 11. IN THE APPELLATE PROCEEDINGS, THE LD. CIT(A) DI SMISSED THE APPEAL OF THE ASSESSEE BY OBSERVING THAT THE ASSESS EE COMPANY HAS MADE PURCHASES OF LARGE NUMBER OF ITEMS WHICH H AS BEEN UTILISED IN CREATION OF CHAMBERS, NEW ELECTRIC AND SANITARY FITTINGS IN TOILETS AND PREMISES AND RESULTED IN EN DURING BENEFIT TO THE ASSESSEE. THE LD. CIT(A) WHILE DISMISSING T HE APPEAL OF THE ASSESSEE RELIED ON THE DECISION OF HONBLE MADR AS HIGH COURT IN THE CASE OF CIT VS. MAHALAKSHMI TEXTILE LTD. 56 ITR 0256, HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SILVER ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 5 GREEN ENTERPRISES VS. CIT 85 ITR 0578 (1972) AND HO NBLE KOLKATA HIGH COURT IN THE CASE OF HUMAYUN PROPERTIE S LTD. VS. CIT 44 ITR 0073 (1962), HONBLE ALLAHABAD HIGH COUR T IN THE CASE OF KANPUR AGENCIES PVT. LTD. VS. CIT 70 ITR 03 37 (1968). 12. THE LD. A.R. VEHEMENTLY SUBMITTED BEFORE US THA T THE EXPENDITURE INCURRED BY THE ASSESSEE ON REPAIRS OF OWN BUILDING HAVE BEEN INCURRED ON RENOVATING THE EXISTING BUILD ING OF THE ASSESSEE, DETAILS WHEREOF WERE GIVEN IN PAGE NO.7 O F THE ASSESSMENT ORDER. THE LD. A.R. WHILE TAKING US THR OUGH THE ITEMS PURCHASED FOR REPAIRING THE BUILDING SUBMITTE D THAT IT COMPRISED OF PURCHASE OF LIGHTS, INTERNAL ALTERATIO N OF OFFICE PREMISES, WOODEN PANELING, HINGES, SANITARY AND PLU MBING WORKS, FALSE CEILING, REPLACEMENT OF WOODEN FLOORIN G, WOODEN QUOTING, FLOOR WIRING, ELECTRIC FITTING AND WIRING ETC. WHICH WERE INCURRED ONLY TO REPAIR THE BUILDING AND MADE IT MO RE CONVENIENT FOR CARRYING ON THE BUSINESS OF THE ASSE SSEE AND THUS HAS NOT RESULTED INTO ANY ENDURING BENEFIT OR CREAT ION OF ANY NEW ASSETS. THE LD. A.R. RELIED ON A SERIES OF DEC ISIONS IN DEFENCE OF HIS ARGUMENT NAMELY; 1. ITO VS. IBP CO. LTD. (20 ITD 470) (CAL.), 2. CIT VS. ARMOUR CONSULTANTS (P.) LTD. (355 ITR 41 8) (MAD HC) 3. CIT VS. DELHI PRESS AND SAMACHAR PATRA (P.) LTD. (2010) 322 ITR 590 (DELHI HC) 4. CIT VS. BHARAT ALLUMINIUM CO. LTD. (292 ITR 600) (DELHI HC) 5. EVERGREEN ENGINEERING COMPANY PVT. LTD. ADDL CIT (ITA NO.117 OF 2015) 6. DCIT VS. PATEL ALUMINIUM PVT. LTD. (ITA NO.1598 OF 2010 7. DCIT VS. SACHDEV GATEWAYS & GATEWAYS PVT. LTD. ( ITA NO.5637 OF 2008 (MUMBAI TRIB.) ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 6 8. DCIT VS. THE SESAKARIA BISWAN SUGAR FACTORY LTD. (ITA NO.5270 OF 2009 (MUMBAI TRIB.) 9. UNITED HOTELS LTD. VS. ADDL. CIT (ITA NO.3225 OF 2012) 10. DCIT VS. RHODIA SPECIALITY CHEMICALS INDIA LTD. (ITA NO.830 OF 2014) (MUMBAI TRI.) 11. NAGPUR POWER & INDUSTRIES LTD. VS. DCIT (ITA NO.5808 OF 2013 (MUMBAI TRI.) 12. MALABAR HILL CLUB LTD. VS. DCIT (ITA NO.4507/MUM/2012) 13. INTERNATIONAL TOBACCO CO. LTD. VS. JCIT (ITA NO.277/MUM/2013) THE LD. A.R. SUBMITTED THAT IN ALL THE ABOVE DECIS IONS IT HAS BEEN HELD THAT THE EXPENSES INCURRED BY THE ASS ESSEE ON OFFICE RENOVATION, PARTITION FLOORING, INTERNAL DEC ORATION ETC. ARE OF REVENUE IN NATURE AND HAS TO BE ALLOWED AS SUCH . THE LD. A.R., THEREFORE, PRAYED THAT THE DISALLOWANCE OUT O F REPAIRS OF RS.2,19,67,334/- MAY KINDLY BE DELETED. SIMILARLY, IN RESPECT OF THE REPAIRS ON LEASED PREMISES THE DETAIL WHEREOF I S GIVEN ON PAGE NO.8 OF THE ASSESSMENT ORDER AND COMPRISED OF MAINLY REPLACEMENT OF WORK STATIONS, CABINET, GLASS FIXING , PAINTING, PANELING, DISMANTLING AND LAYING OF FOUNDATIONS AND GRANITE, BRICKWORKS, REPLACEMENT OF WORN OUT CARPETS, PLUMBI NG, CIVIL WORKS, FALSE CEILING WORK, PANELING, PARTITIONS, DO OR WINDOWS AND GLAZED FLOORING ETC. THE LD. A.R. SUBMITTED THAT TH E SAID PREMISES WERE TAKEN ON LEASE AND THE EXPENDITURE WA S INCURRED TO RENDER THE PREMISES IN A USUAL AND USABLE CONDIT ION BY THE ASSESSEE. THE LD. A.R. SUBMITTED THAT THE SAID EXP ENDITURE IS PURELY OF REVENUE NATURE AND HAS TO BE ALLOWED. TH E LD. A.R. RELIED ON THE FOLLOWING DECISIONS: 1. CIT V. AMWAY INDIA ENTERPRISES [(2012) 346 ITR 341 (DELHI HC)| 2. CIT V. COROMANDEL FERTILIZERS LTD. (2014) 367 ITR 1 32 (AP HC) ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 7 3. CIT V. AYESHA HOSPITALS (P.) LTD. (20 07) 292 ITR 266 (MAD.) 4. DCIT V. LAZARD INDIA (P.) LTD. (2010) 41 SOT 72 (MNMBAI TRIBUNAL) 5. URBAN INFRASTRUCTURE VENTURE CAPITAL LID V. DCIT (2014) 150 ITD 502 (MIRMBAI TRIBUNAL) 6. DC1T V. CHAYYA LAKSHMI CREATIONS (P) LTD. [ITA NO.250 OF 2010 (HYDERABAD TRIBUNAL) 7. DC1T V. EUREKA FORBES LTD. [ITA NO.2126 OF 2013 (KOLKATA TRIBUNAL) 8. ACIT VS. M/S. CB RICHARDS ELLIS SOUTH ASIA PVT. LTD . (ITA NO.3940/DEL/2011) (DEL. TRIB.) THE LD. AR, THEREFORE, PRAYED THAT THE REPAIRS OF R ENTED PREMISES MAY BE ALLOWED BY DIRECTING THE AO TO DELETE THE DI SALLOWANCE. 13. THE LD. D.R., ON THE OTHER HAND, RELIED ON THE ORDER OF AUTHORITIES BELOW BY SUBMITTING THAT THE ASSESSEE H AS INCURRED HUGE REPAIRS AND CARRIED OUT EXTENSIVE RENOVATION O F THE BUILDING THUS WHICH HAS INCREASED THE LIFE OF THE PREMISES A ND HAS RESULTED INTO ENDURING BENEFIT WHICH WERE ACCRUED T O THE ASSESSEE OVER A LONGER PERIOD OF TIME THAN THE CURR ENT YEAR. THE LD. D.R., THEREFORE, SUBMITTED THAT THE ORDER OF LD . CIT(A) MAY KINDLY BE SUSTAINED. 14. WE HAVE HEARD THE RIVAL SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD INCLUDING THE CA SE LAWS RELIED UPON BY BOTH THE PARTIES. THE UNDISPUTED FA CTS ARE THAT THE ASSESSEE HAS INCURRED EXPENSES ON REPAIRS AND R ENOVATION OF RENTED AS WELL AS OWN PREMISES. THE ASSESSEE HAS I NCURRED RS.2,19,67,334/- ON REPAIRS AND RENOVATION OF OWN B UILDING AND WE FIND THAT THE EXPENDITURE THE DETAILS WHEREOF WE RE GIVEN ON THE PAGE NO.9 OF THE ASSESSMENT ORDER ARE IN THE NA TURE OF INTERNAL MODIFICATION, LIGHTING OF THE OFFICE PANEL ING PIN BOARD, ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 8 HINGES, SANITARY AND PLUMBING WORKS, REPLACEMENT OF WOODEN FLOORING ETC. AND IN NO WAY CONSTITUTE CAPITAL EXPE NDITURE. IN OUR OPINION, THE SAID EXPENDITURE IS IN THE NATURE OF A ROUTINE REPAIRS THOUGH IT HAS BEEN CARRIED OUT ON EXTENSIVE BASIS. IN OUR OPINION, THE SAID EXPENDITURE HAS NOT RESULTED IN T HE CREATION OF ANY ENDURING BENEFIT TO THE ASSESSEE OR RESULTED IN CREATION OF ANY NEW ASSETS. WE ARE THEREFORE OF THE VIEW THAT THE ORDER PASSED BY THE LD. CIT(A) UPHOLDING THE ORDER OF AO IS NOT CORRECT AND CAN NOT BE SUSTAINED. IN THE CASE OF ITO VS. I BP CO. LTD. (SUPRA) THE HONBLE KOLKATA HIGH COURT HAS HELD THA T ADVANTAGE OBTAINED BY THE ASSESSEE BY REDESIGNING THE PREMISE S WAS FOR THE PURPOSE OF BUSINESS AND NOT FOR ACQUISITION OF ANY CAPITAL ASSETS AND WAS PRIMARILY MOTIVATED FOR ACHIEVING BE TTER EFFICIENCY AND EFFICACY IN THE WORKING OF THE ASSES SEE AND IN THAT SENSE THE ADDITION DERIVED WAS IN A COMMERCIAL SENS E AND IT DID NOT RESULT IN ANY BENEFIT OF ENDURING NATURE. IN T HE CASE OF CIT VS. DELHI PRESS AND SAMACHAR PATRA (P.) LTD. (SUPRA ) THE HONBLE DELHI HIGH COURT HAS UPHELD THE ORDER OF TRIBUNAL W HEREIN THE TRIBUNAL HAS ALLOWED THE EXPENDITURE INCURRED TO PR ESERVE AND MAINTAIN THE ASSETS WHICH WAS INCURRED BY WAY OF WA TER PROOFING OF ROOF WITH STONES, RE-ENFORCEMENT OF OLD BEAMS IN WHICH BARS AND PLASTERS WERE CORRODED RELAYING OF W ORN OUT FLOOR, REPAIRING AND RELAYING/CORRODING OF RODS, RU NNING INSIDE THE PRESS COMPOUND, REPAIRING AND REPLACEMENT OF WO RKS WASH ROOM, WOOD WORK AND REPAIRING AND RELAYING OF BOUND ARY WALL ETC. THE HIGH COURT HAS DISMISSED THE APPEAL OF TH E REVENUE BY OBSERVING THAT NO SUBSTANTIAL QUESTION OF LAW ARISE S FROM THE SAID APPEAL. SIMILARLY, WE HAVE PERUSED THE OTHER DECISIONS RELIED UPON BY THE ASSESSEE WHEREIN THE SIMILAR EXP ENDITURE ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 9 WERE HELD TO BE OF REVENUE NATURE. WE, THEREFORE, ARE OF THE CONSIDERED VIEW THAT THE REPAIRS OF RS.2,19,67,334/ - IS OF REVENUE NATURE AND AO IS DIRECTED TO ALLOW THE SAME . AS REGARDS THE RENTED PREMISES, WE OBSERVE THAT THE ASSESSEE H AS INCURRED THE EXPENSES OF RS.52,58,076/- TO MAKE THE RENTED P REMISES SUITABLE FOR CARRYING ON ITS ACTIVITIES. THE EXPEN DITURE ON REPAIRS INCLUDED VARIOUS ITEMS OF EXPENDITURE SUCH AS REPLA CEMENT OF WORK STATIONS, CABINET, GLASS FIXING, PAINTING, PAN ELING, DISMANTLING AND LAYING OF FOUNDATIONS AND GRANITE, BRICKWORKS, REPLACEMENT OF WARN OUT CARPETS, PLUMBING, CIVIL WO RKS, FALSE CEILING WORK, PANELING, PARTITIONS, DOOR WINDOWS AN D GLAZED FLOORING ETC. AFTER EXAMINING THE NATURE OF EXPENS ES INCURRED BY THE ASSESSEE, WE FIND THAT THE SAID EXPENDITURE WAS INCURRED ON BUILDING WHICH WAS TAKEN ON RENT AND TO MAKE IT USA BLE FOR THE PURPOSE OF BUSINESS AND THEREFORE ANY EXPENDITURE I NCURRED IN THE NATURE OF REPAIRS AND MAJOR RENOVATION CAN NOT BE TREATED AS CAPITAL IN NATURE AS THE ASSESSEE HAS NOT CREATED A NY ASSETS. IN THE CASE OF CIT VS. AMWAY INDIA ENTERPRISES (SUPRA) HONBLE DELHI HIGH COURT HAS HELD THAT EXPENSES INCURRED ON FLOORING PARTITION, WIRING, FALL CEILING, ROOFING, AIR CONDI TIONING, ELECTRIC WIRING AND LAYING NETWORK FOR SETTING UP OF COMPUTE RS AND PURCHASE OF FURNITURE ARE OF REVENUE NATURE. THE HO NBLE DELHI HIGH COURT HAS FOLLOWED THE DECISION IN THE CASE OF CIT VS. LINE PENS (P) LTD. [2008] 306 ITR 182 (DEL) AND THUS HEL D THE EXPENDITURE TO BE REVENUE IN NATURE. SIMILARLY, IN THE CASE OF CIT VS. CORAMONDAL FERTILIZER LTD. THE HONBLE ANDH RA PRADESH HIGH COURT HAS HELD THAT EXPENDITURE INCURRED FOR W OODEN PARTITION, ELECTRIC WIRING, POWER CONNECTION, INTER IOR LAY OUT ETC. ARE IN THE NATURE OF REVENUE EXPENDITURE. SIMILARL Y, IN THE CASE ITA NO.5317/M/2015 M/S. GOD FREY PHILIPS INDIA LTD. 10 OF CIT VS. AYESHA HOSPITALS (P.) LTD. (SUPRA) THE H ONBLE MADRAS HIGH COURT HAS HELD THAT EXPENDITURE ON PAINTING AN D RELAYING DAMAGE FLOOR AND PARTITION OF LEASED PREMISES CAN N OT BE CONSIDERED AS CAPITAL IN NATURE. IN VIEW OF THE RA TIO LAID DOWN BY THE VARIOUS HIGH COURTS, WE ARE INCLINED TO SET ASI DE THE ORDER OF LD. CIT(A) AND DIRECT THE AO TO DELETE THE ADDITION . IN THE RESULT, THE GROUND RAISED BY THE ASSESSEE IS ALLOWED. 15. THE ISSUE RAISED IN GROUND NO 5 IS CONSEQUENTIA L IN NATURE AND NEEDS NO ADJUDICATION. SIMILARLY THE GROUND NO. 6 IS OF GENERAL NATURE AND IS NOT REQUIRED TO ADJUDICATED. 16. IN RESULT THE APPEAL IF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 13.09.2019. SD/- SD/- ( AMARJIT SINGH) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 13.09.2019. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORDER DY/ASS TT. REGISTRAR, ITAT, MUMBAI.