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3. The learned CIT (A) has erred in confirming the disallowance made by the AO towards payment of Rs. 33,48,666/- made to Fund quest by invoking the provisions of section 40(a)(i) of the Act and :- 5 -:

I.T.A. No. 1774/Mds/2012 stating that the payment is in the nature of royalty failing within the ambit of provisions of section 9 of the act.

4. The learned CIT (A) has erred in upholding the order of the AO in treating the payment of Rs. 1,85,95,094/- towards renovation of existing lease building as a capital expenditure ignoring the fact that the expenditure has neither resulted in any structural change to the building nor in the creation of new capital asset. 4.1 The learned CIT (A) has erred in not following the principles laid down in the decision of the Hon'ble Chennai ITAT in the Appellant's own case for the Assessment Year ('AY') - 2006-07.

5. We have considered the rival submissions. A perusal of the break up of the expenses which have been disallowed clearly shows that the expenditures are on the interior decorations and creation of the office atmosphere. The expenditure has not resulted in any building coming into existence nor has the existing building been modified or the structure altered. As the existing building has not been altered and there is no change to its structure as a result of the expenditure incurred by the assessee, it cannot be said that the expenditure :- 18 -: