confirming the disallowance made by Assessing Officer on account of
current repairs and replacement of plant & machinery amounting to
Rs.82,29,424/-. Briefly ... also observed that
a mere statement that assessee had incurred current repairs and
replacement of plant & machinery is not sufficient to hold that
revenue or capital in nature, but whether the expenditure was
"current repairs". The basic test was to find out whether expenditure was incurred ... replacement thereof would not come within the meaning
of "current repairs". The replacement of the ring frame constituted
substitution of an old asset
restricting it to the concept of "current repairs". All repairs are not
current repairs. Sec. 37(1) allows claims for expenditure which ... Current repairs' do not mean only petty repairs or
repairs necessitated by wear and tear particular year
(iv) Such repairs should nol bring into
repairs" u/s 31(i). The exact nature of repair work done by the appellant was not
ascertainable from the ledger account of repairs ... under the head repairs to building and repairs to plant and machinery
over the years;
AY Repairs & maintenance to Repairs & maintenance to
building
Report. However, the assessee claimed that the
expenditure incurred representing the current repairs and therefore allowable ... question by the AO about the details
of current repairs and source of fund for such huge expenditure the assessee
ITA No.2320 & 2364
under:
'i) The amount should be paid on account of current repairs.
ii) 'Current repairs' means repairs undertaken in the normal course ... Current repairs' do not mean only petty repairs or repairs necessitated
by wear and tear during the particular year.
iv) Such repairs should
tenant, the amount paid by him on account of current
repairs to the premises;
Accordingly it was stated that the provisions of the Act provide ... purpose of business by restricting it to the
concept of current repairs. To decide the applicability of section 30 of the Act, the test
Saurashtra Ferrous P. Ltd, Mumbai vs Ito Wd 9(2)(2), Mumbai on 8 December
leasehold premises is not an expenditure allowable
under section 31 as current repairs or alternatively as
expenditure under section 37.
3) The CIT (A) erred ... allowable u/s.31 of IT Act ,under the head current
repairs and accordingly held it as capital asset and allowed
the depreciation @10% treating
clause
(i), and the amount paid on account of current repairs referred to in
sub-clause (ii), of clause (a), shall not include any expenditure ... hereby declared that the
amount paid on account of current repairs shall not include any
expenditure in the nature of capital expenditure
