MAHARASHTRA STATE CO OP CONSUMERS FEDERATION LTD., MUMBAI V. INCOME TAX OFFICER 13(2)(2), MUMBAI

ITA 6128/MUM/2008

• Counselvise Citation: 612819914 RSA 2008
• Duration Of Justice: 2 year(s) 10 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 11-08-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 10-10-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D S SUNDER SINGH
• Assessee Lawyers: ANIL J SATHE
• Keywords: Business expenditure
• Section: 11; 37(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, B, MUMBAI BEFORE S/SHRI D.K.AGARWAL (JM) AND RAJENDRA SINGH(A .M ) ITA NO.5828/MUM/2008 (ASSESSMENT YEAR:2005-06) INCOME TAX OFFICER, 13(2)(2), ROOM NO.412, 4 TH FLOOR, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI-400020 MAHARASHTRA STATE CO-OPERATIVE, CONSUMERS FEDERATION LTD., 87-A, RAJ CHEMBERS, D.R.MARG, DANA BUNDER, MUMBAI-400009, PAN :AAAFM2067K APPELLANT V/S RESPONDENT ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) MAHARASHTRA STATE CO-OPERATIVE, CONSUMERS FEDERATION LTD., 87-A, RAJ CHEMBERS, 5 TH FLOOR, DEVAJI RATANSHI MARG, DANA BUNDER, MUMBAI-400009, PAN :AAAFM2067K V/S INCOME TAX OFFICER, 13(2)(2), ROOM NO.412, 4 TH FLOOR, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI-400020 APPELLANT RESPONDENT DATE OF HEARING : 11.8.2011 DATE OF PRONOUNCEMENT : 24.8.2011 REVENUE BY : SHRI D.S.SUNDER SINGH ASSESSEE BY : SHRI ANIL J.SATHE O R D E R PER D.K.AGARWAL (JM) THESE CROSS-APPEALS BY THE REVENUE AND ASSESSEE ARE DIRECTED AGAINST THE ORDER DATED 14.07.2008 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (A) FOR THE ASSESSMENT YEAR 2005-06. ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 2 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN AOP BEING THE APEX BODY OF CONSUMERS CO-OPER ATIVE SOCIETIES IN THE STATE OF MAHARASHTRA. ITS BUSINES S IS DEVIDED IN 8 DIVISIONAL OFFICES AND 13 APNA BHAND ARS WHICH ARE RETAIL OUTLETS OF FEDERATIONS. THE FEDERATION IS SEMI- GOVERNMENT BODY SPONSORED AND FULLY SUPPORTED BY TH E STATE GOVERNMENT FEDERATIONS. THE RETURN WAS FILED DECLARING TOTAL INCOME OF RS.1,02,198/-. HOWEVER, THE ASSESS MENT WAS COMPLETED AT AN INCOME OF RS.NIL. AFTER ADJUSTING BROUGHT FORWARD LOSSES OF ASSESSMENT YEAR 2000-01 OF RS.10, 99,302/- VIDE ORDER DATED 28.9.2007 PASSED UNDER SECTION 14 3(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). ON A PPEAL,THE LEARNED COMMISSIONER OF INCOME TAX (A), PARTLY ALLO WED THE APPEAL. 3. BEING AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (A), THE REVENUE AND ASS ESSEE BOTH ARE IN APPEAL BEFORE US. ITA NO.5828/MUM/2008 (BY REVENUE) 4. THE GROUNDS NO.1 AND 2 IN THE REVENUES APPEAL A RE AGAINST THE DELETION OF ADDITION OF RS.10,00,000/- MADE BY HE AO UNDER SECTION 41(1) OF THE ACT. ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 3 5. THE BRIEF FACTS OF THE ABOVE ISSUE ARE THAT DURI NG THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE WAS ASKED TO GIVE DETAILS OF SUNDRY CREDITORS OF RS.25,60,09 ,090/-. IN RESPONSE, THE ASSESSEE SUBMITTED BRANCH-WISE LIST OF THE CREDITORS. THE AO OBSERVED THAT THERE ARE CERTAIN CREDITORS IN THE LIST WHICH REMAINED UNPAID FOR MORE THAN 5 Y EARS. THE ASSESSEE WAS ASKED TO PRODUCE THE LIST ALONG WITH REASONS. THE ASSESSEE SUBMITTED DETAILS OF LIABILITIES PEN DING FOR MORE THAN 5 YEARS AND STATED THAT : DUE TO HEAVY LOSSES IN PAST AND TO CONSERVES THE WORKING CAPITAL, THE FEDERATION HAS ADOPTED THE METHODOLOGY OF RELEASING PAYMENT TO SUPPLIERS/CREDI TOR ONLY AGAINST RECEIPT OF MONEY FROM THE RESPECTIVE CUSTOMERS OF FEDERATION. FEDERATION MOST OF THE TIM E RELEASE PART PAYMENT, AS A RESULT HUGE, CREDITORS A RE THERE. THE SAME ARE BEING RECONCILED. AND AS SUCH THE LIABILITIES ARE NOT CEASED YET ON SCRUTINY OF DETAILS, THE AO OBSERVED THAT THE A PEX BODY HAS SHOWN LIABILITY OF RS.10,85,531/- PENDING FOR M ORE THAN 5 YEARS AND THE SAME HAS NOT BEEN CLAIMED BY THE CRED ITORS, THEREFORE, THE AO PRESUMED THAT THE LIABILITY TO P AY THE CREDITORS HAS SINCE CEASED AND ACCORDINGLY HE TREAT ED RS.10,85,531/- AS PROFIT CHARGEABLE TO TAX UNDER S ECTION 41(1) OF THE ACT AND ADDED TO THE TOTAL INCOME OF T HE ASSESSEE. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME TAX (A) WHILE OBSERVING THAT THERE IS NO PROOF THAT THE APPELLANT OBTAINED ANY BENEFIT IN RESPECT OF THESE CREDITORS, ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 4 THE LIABILITY HAS NOT BEEN WRITTEN BACK BY THE APPE LLANT, THERE IS NO REMISSION OF LIABILITY AND FOLLOWING THE DE CISION OF THE HONBLE SUPREME COURT IN THE CASE OF COMMISSIONER O F INCOME-TAX V/S SUGAULI SUGAR WORKS (P.) LTD. (1999) 236 ITR 518 (SC) DELETED THE ADDITION OF RS.10,00,000/- MADE BY THE AO. 6. AT THE TIME OF HEARING, THE LEARNED D.R. SUBMITS THAT FOR THE REASONS AS MENTIONED IN THE ASSESSMENT ORDER, THE LEARNED COMMISSIONER OF INCOME TAX (A) WAS NOT JUS TIFIED IN DELETING THE ADDITION OF RS.10,00,000/- MADE BY THE AO UNDER SECTION 41(1) OF THE ACT. 7. ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE ASSESSEE WHILE RELYING ON THE SUBMISSIONS MADE BEF ORE THE AO AND THE LEARNED COMMISSIONER OF INCOME TAX (A), ALSO RELIED ON THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(A). THE RELIANCE WAS ALSO PLACED ON THE DECISI ON IN AMBICA MILLS LTD. V/S COMMISSIONER OF INCOME-TAX ( 1964) 54 ITR 167 (GUJ) FOR THE PROPOSITION THAT SINCE THE AMOUNT HAS BEEN SHOWN AS LIABILITY IN THE BALANCE-SHEET, IT IS AN ACKNOWLEDGMENT WITHIN THE MEANING OF SECTION 19 OF THE LIMITATION ACT. THE RELIANCE WAS ALSO PLACED ON T HE DECISION IN COMMISSIONER OF INCOME-TAX V/S TAMILNADU WAREHOU SING CORPORATION (2007) 292 ITR 310 (MAD.) FOR THE PROPO SITION ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 5 THAT IN THE ABSENCE OF ANY EVIDENCE OF CESSATION OF LIABILITY, THE AMOUNT IS NOT ASSESSABLE UNDER SECTION 41(1) OF THE ACT. THE RELIANCE WAS ALSO PLACED ON THE DECISION OF T HE HONBLE SUPREME COURT IN THE CASE OF SUGAULI SUGAR WORKS ( P.) LTD. (SUPRA). HE, THEREFORE, SUBMITS THAT THE ORDER PAS SED BY THE LEARNED COMMISSIONER OF INCOME TAX (A) IN DELETING THE ADDITION BE UPHELD. 8. HAVING CAREFULLY HEARD THE SUBMISSIONS OF THE R IVAL PARTIES AND PERUSING THE MATERIAL AVAILABLE ON RECO RD, WE FIND THAT THERE IS NO DISPUTE THAT THE ASSESSEE HAS SHO WN THE SUNDRY CREDITORS IN ITS BALANCE-SHEET AMOUNTING TO RS.25,60,09,090/- INCLUDING THE LIABILITY OF APEX BODY PENDING FOR MORE THAN 5 YEARS RS. 10,85,531/- SUPP ORTED BY THE RELEVANT DETAILS THEREOF. OUT OF IT, THE AO H AS ADDED RS.10,85,531/- ON THE GROUND THAT THE SAID LIABILI TY IS PENDING FOR MORE THAN 5 YEARS, THEREFORE, THE SAME IS CEASED TO EXISTS AND HENCE CHARGEABLE TO TAX UNDER SECTION 41(1) OF THE ACT. HOWEVER, THE LEARNED COMMISSIONER OF INCO ME TAX(A) DELETED THE SAME ON THE GROUND THAT THE SAME IS NOT BARRED BY LIMITATION ACT AND THERE IS NO PROOF THAT THE APPELLANT OBTAINED ANY BENEFIT IN RESPECT OF THESE CREDITORS, THE LIABILITY HAS NOT BEEN WRITTEN BACK BY THE APP ELLANT, THERE IS NO REMISSION OF LIABILITY, THEREFORE, FOLLOWING THE DECISION OF THE HONBLE SUPREME COURT IN SUGAULI SUGAR WORK S (P.) ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 6 LTD. (SUPRA), HE DELETED THE ADDITION OF RS.10,00, 000/-. IN THE ABSENCE OF ANY CONTRARY MATERIALS PLACED ON RE CORD BY THE REVENUE TO SHOW THAT NO SUCH LIABILITY EXISTS IN THE BOOKS OF ACCOUNT OR THE ASSESSEE HAS OBTAINED ANY B ENEFIT BY CASH OR IN ANY MANNER DURING THE CURRENT YEAR, WE ARE OF THE VIEW THAT MERELY BECAUSE THE SAID LIABILITY IS MORE THAN 5 YEARS OLD DOES NOT MEAN THAT THERE IS A CESSATION O R REMISSION OF THE LIABILITY IN VIEW OF THE PROVISION S OF SECTION 41(1) OF THE ACT. 9. IN SUGAULI SUGAR WORKS (PVT.) LTD. (SUPRA) IT H AS BEEN HELD (HEAD NOTE, PAGE 519): THE PRINCIPLE THAT EXPIRY OF THE PERIOD OF LIMITAT ION PRESCRIBED UNDER THE LIMITATION ACT COULD NOT EXTIN GUISH THE DEBT BUT IT WOULD ONLY PREVENT THE CREDITOR FRO M ENFORCING THE DEBT, HAS BEEN WELL SETTLED. IF THAT PRINCIPLE IS APPLIED, IT IS CLEAR THAT MERE ENTRY IN THE BOOK S OF ACCOUNT OF THE DEBTOR MADE UNILATERALLY WITHOUT ANY ACT ON THE PART OF THE CREDITOR WILL NOT ENABLE THE DEB TOR TO SAY THAT THE LIABILITY HAS COME TO AN END. APART FR OM THAT, THAT WILL NOT BY ITSELF CONFER ANY BENEFIT ON THE D EBTOR AS CONTEMPLATED BY THE SECTION.. RESPECTFULLY FOLLOWING THE RATIO OF THE ABOVE DECIS ION AND THE RATIO OF OTHER DECISIONS RELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE, WE ARE OF THE VIEW THAT THE LEAR NED COMMISSIONER OF INCOME TAX (A) WAS FULLY JUSTIFIED IN DELETING THE ADDITION OF RS.10,00,000/- MADE BY THE AO ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 7 UNDER SECTION 41(1) OF THE ACT. THE GROUNDS TAKEN BY THE REVENUE ARE, THEREFORE, REJECTED. ITA NO.6128/MUM/2008 (BY ASSESSEE) 10. THE SOLE GROUND TAKEN BY THE ASSESSEE IN ITS AP PEAL IS AGAINST THE SUSTENANCE OF THE DISALLOWANCE OF CURRE NT REPAIRS OF RS.,2,01,500/-. 11. BRIEF FACTS OF THE ABOVE ISSUE ARE THAT THE AO NOTED THAT THE ASSESSEE HAS DEBITED AN AMOUNT OF RS.5,83 ,158/- UNDER THE HEAD REPAIR AND MAINTENANCE IN ITS PROFIT AND LOSS ACCOUNT. THESE EXPENSES INCLUDE AN AMOUNT OF RS.2,01,500/- BEING PAID TO SHRI GHOGRI NISAR AHM ED FOR REPAIRS OF MUMBAI OFFICE. THE ASSESSEE HAS PRODUCE D THE COPY OF THE BILL DATED 28.7.2004. ON THE ANALYSIS OF BILLS THE AO NOTED THAT THESE EXPENSES ARE MADE FOR FOLLOWIN G HEADS: A. BREAKING OLD PLASTER OF BEAM WALL; B. MAKING NEW 6 BRICK WALL FOR WINDOW; C. PROVIDING & FIXING NEW MORBONITE TILES; D. PROVIDING & FIXING NEW GRANITE STONES; E. PROVIDING AND FIXING WIRING IN CASING AND MANY OTHERS ETC. FROM THE ABOVE DETAILS OF EXPENSES, THE AO OBSERVE D THAT THE ABOVE EXPENSES ARE NOT OF USUAL WEAR AND TEAR OR CURRENT REPAIRS AND HENCE HE TREATED RS.2,01,500/ - IS ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 8 CAPITAL IN NATURE NOT ALLOWABLE UNDER SECTION 37(1) OF THE ACT. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME TAX ( A) WHILE OBSERVING THAT IT IS A CASE OF COMPLETE RENOV ATION OF THE OFFICE SPACE AND NOT A CASE OF NORMAL REPAIR OF OFF ICE SPACE, FOLLOWING THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF BALLIMAL NAVAL KISHORE AND ANOTHER V/S COMMISSIONER OF INCOME-TAX [1997] 224 ITR 414 (SC) CONFIRMED THE DISALLOWANCE MADE BY THE AO. 12. AT THE TIME OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITS THAT THE ASSESSEE HAS INCURRED RO UTINE REPAIR EXPENSES FOR THE OFFICE PREMISES ON THE TENA NTED BUILDING WHICH IS MORE THAN 60 YEARS OLD. AS PER TH E BILL OF THESE EXPENSES ALL THESE EXPENSES ARE IN THE NATUR E OF CURRENT REPAIRS, THEREFORE, THE SAME ARE ALLOWABLE AS BUSINESS EXPENDITURE UNDER SECTION 37(1) OF THE ACT . THE LEARNED COUNSEL FOR THE ASSESSEE WHILE DISTINGUISHI NG THE DECISION IN THE CASE OF BALLIMAL NAVAL KISHORE (SU PRA) PLACED RELIANCE IN THE CASE OF GULAMHUSSEIN EBRAHIM MATCH ESWALLA V/S COMMISSIONER OF INCOME-TAX (1974) 97 ITR 24 (BO M.) AND THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN ADDITIONAL COMMISSIONER OF INCOME-TAX V/S INDIA UN ITED MILLS LTD. [1983] 141 ITR 399 (BOM.). HE, THEREFOR E, SUBMITS THAT THE DISALLOWANCE MADE BY THE AO AND SUSTAINED BY THE LEARNED COMMISSIONER OF INCOME TAX (A) BE DELETED. ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 9 13. HAVING CAREFULLY HEARD THE SUBMISSIONS OF THE RIVAL PARTIES AND PERUSING THE MATERIAL AVAILABLE ON RECO RD, WE FIND THAT THE FACTS ARE NOT IN DISPUTE INASMUCH AS IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE HAS INCURRED TOTAL REPAIR S AND MAINTENANCE EXPENSES OF RS.5,83,158/- DURING THE Y EAR AND OUT OF IT THE AMOUNT OF RS.2,01,500/- WAS INCURRE D ON OFFICE REPAIRS AND IN SUPPORT, THE ASSESSEE HAS ALSO FILED THE COPY OF THE BILL FOR RS.2,01,500/- TO SHOW THAT THE AB OVE EXPENSES FOR REPAIRS HAVE BEEN INCURRED FOR BREAKIN G OLD PLASTER OF BEAM WALL; MAKING NEW 6 BRICK WALL FOR WINDOW; PROVIDING & FIXING NEW MORBONITE TILES ETC. FROM T HE AFORESAID DETAILS IT IS OBSERVED THAT THE ABOVE EXP ENSES HAVE BEEN INCURRED ON THE EXISTING OFFICE BUILDING WHICH WAS TAKEN ON LEASE AND STATED TO BE OLD FOR MORE THAN 60 YEA RS. IT IS NOT THE CASE OF THE REVENUE THAT THE ABOVE REPAIRS HAVE BEEN INCURRED FOR ACQUIRING ANY NEW ASSET OR THERE WAS NO SUCH EXISTENCE OF WALL, WINDOW AND FLOOR IN THE O FFICE. 14. IN BALLIMAL NAVAL KISHORE (SUPRA), RELIED UPON BY THE LEARNED COMMISSIONER OF INCOME TAX (A) IT HAS BEEN HELD THAT (PENULTIMATE PARA, PAGES 417-418) : APPLYING THE AFORESAID TEST, IF WE LOOK AT THE FAC TS OF THIS CASE, IT WILL BE EVIDENT THAT WHAT THE ASSESSEE DID WAS NOT MERE REPAIRS BUT A TOTAL RENOVATION OF THE THEA TRE. NEW MACHINERY, NEW FURNITURE, NEW SANITARY FITTINGS AND NEW ELECTRICAL WIRING WERE INSTALLED BESIDES EXTENS IVELY REPAIRING THE STRUCTURE OF THE BUILDING. BY NO STRE TCH OF ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 10 IMAGINATION, CAN IT BE SAID THAT THE SAID REPAIRS Q UALIFY AS CURRENT REPAIRS WITHIN THE MEANING OF SECTION 10(2)(V). IT WAS A CASE OF TOTAL RENOVATION AND HAS RIGHTLY BEEN HELD BY THE HIGH COURT TO BE CAPITAL IN NATURE . INDEED, THE FINDING OF THE HIGH COURT IS THAT AS AG AINST THE SUM OF RS. 17,000 FOR WHICH THE ASSESSEE HAD PURCHASED THE FACTORY IN 1937, THE EXPENDITURE INCU RRED IN THE RELEVANT ACCOUNTING YEAR WAS IN THE REGION O F RS. 1,20,000. 15. RECENTLY, THE HONBLE SUPREME COURT IN COMMIS SIONER OF INCOME-TAX V/S SARAVANA SPINNING MILLS P. LTD. [ 2007] 293 ITR 201 (SC) AFTER CONSIDERING VARIOUS DECISIONS IN CLUDING THE DECISION IN BALLIMAL NAVAL KISHORE (SUPRA) HAS CONSIDERED THE MEANING OF CURRENT REPAIRS AND LAID DOWN FOLLOWING TESTS : HELD, _ REVERSING THE DECISION OF THE HIGH COURT, (I) THA T THE MANUFACTURING PROCESS IN THE TEXTILE MILL WAS N OT ONE CONTINUOUS INTEGRATED PROCESS ; (II) THAT TO DECIDE THE APPLICABILITY OF SECTION 31 (I) THE TEST WAS NOT WHETHER THE EXPENDITURE WAS REVENUE OR CAPITAL IN NATURE, BUT WHETHER THE EXPENDITURE WAS CURRENT REPAIRS. THE BASIC TEST WAS TO FIND OUT W HETHER EXPENDITURE WAS INCURRED TO PRESERVE AND MAINTAIN AN ALREADY EXISTING ASSET, AND THE EXPENDITURE MUST NO T BE TO BRING A NEW ASSET INTO EXISTENCE OR TO OBTAIN NE W ADVANTAGE. (III) THAT EACH MACHINE INCLUDING THE RING FRAME WA S AN INDEPENDENT AND SEPARATE MACHINE CAPABLE OF INDEPENDENT AND SPECIFIC FUNCTION AND, THEREFORE, T HE EXPENDITURE INCURRED FOR REPLACEMENT THEREOF WOULD NOT COME WITHIN THE MEANING OF CURRENT REPAIRS. THE REPLACEMENT OF THE RING FRAME CONSTITUTED SUBSTITUT ION OF AN OLD ASSET BY A NEW ASSET, AND, THEREFORE, THE EXPENDITURE INCURRED BY THE ASSESSEE DID NOT FALL W ITHIN THE MEANING OF CURRENT REPAIRS IN SECTION 31(I). ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 11 UNDER SECTION 31(I) THE DEDUCTION ADMISSIBLE IS ONL Y FOR CURRENT REPAIRS. THEREFORE, THE QUESTION AS TO WHET HER THE EXPENDITURE INCURRED BY THE ASSESSEE CONCEPTUAL LY IS REVENUE OR CAPITAL IN NATURE IS NOT RELEVANT FOR DE CIDING THE QUESTION WHETHER SUCH EXPENDITURE COMES WITHIN THE ETYMOLOGICAL MEANING OF THE EXPRESSION CURRENT REP AIRS. IN OTHER WORDS, EVEN IF THE EXPENDITURE IS REVENUE IN NATURE, IT MAY NOT FALL IN THE CONNOTATION OF CURR ENT REPAIRS. 16. APPLYING THE AFORESAID TESTS TO THE FACTS OF TH E PRESENT CASE, WE FIND THAT THE IN THIS CASE THE ASSESSEE O N THE TENANTED OFFICE BUILDING WHICH IS MORE THAN 60 YEAR S OLD, HAS INCURRED REPAIRS TO PRESERVE AND MAINTAIN AN ALREAD Y EXISTING ASSETS AND THERE IS NO MATERIAL ON RECORD TO SHOW T HAT BY INCURRING SUCH EXPENDITURE THE NEW ASSETS HAS COME INTO EXISTENCE OR THE ASSESSEE HAS OBTAINED A NEW ADVAN TAGE. THE MERE FACT THAT THE EXPENDITURE HAS BROUGHT TH E BENEFIT OF A LARGER LIFE TO THE ASSETS AND BETTER SERVICES, WOULD NOT MAKE THE EXPENDITURE AN EXPENDITURE OF CAPITAL NATU RE AS NO ENDURING ADVANTAGE WAS OBTAINED BY THE ASSESSEE. THIS BEING SO AND KEEPING IN VIEW THAT THERE IS NO MAT ERIAL ON RECORD TO SHOW THAT THE ASSESSEE HAS MADE TOTAL RE NOVATION OF THE OFFICE, WE ARE OF THE VIEW THAT THE DECISION RELIED ON BY THE LEARNED COMMISSIONER OF INCOME TAX (A) IS DISTINGUISHABLE AND NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. FOR THE REASONS AS DISCUSSED ABOVE WE HOLD T HAT THE REPAIR EXPENDITURES INCURRED BY THE ASSESSEE ARE IN THE NATURE OF CURRENT REPAIRS ALLOWABLE AS BUSINESS EXP ENDITURE ITA NO.5828/MUM/2008 ITA NO.6128/MUM/2008 (ASSESSMENT YEAR:2005-06) 12 AND ACCORDINGLY, THE DISALLOWANCE OF RS.2,01,500/- MADE BY THE AO AND SUSTAINED BY THE LEARNED COMMISSIONER O F INCOME TAX (A) IS DELETED. THE GROUND TAKEN BY THE ASSESSEE IS, THEREFORE, ALLOWED. 17. IN THE RESULT, REVENUES APPEAL STANDS DISMISSE D AND ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 24TH AUGU ST,2011. SD SD (RAJENDRA SINGH) (D.K.AG ARWAL) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 24TH AUGUST, 2011 SRL: COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT CONCERNED 4. CIT(A) CONCERNED 5. DR CONCERNED BENCH 6. GUARD FILE. TRUE COPY BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI