Current repairs exclude substantial machinery replacement, and partners' boarding and lodging remain personal despite business travel.

Current repairs under the Indian Income-tax Act are confined to petty, periodic restorative work, not substantial replacement or renewal of a sizeable part of machinery. On the stated facts, replacement of a substantial part of the flour mill cables was treated as capital-like replacement and not allowable as current repairs. Boarding and lodging expenses of partners, even when incurred during business tours, remain personal in nature unless shown to be wholly and exclusively for business; such expenses were therefore not deductible. The disputed outgoings were held inadmissible deductions, and the reference was answered for the Revenue.

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Issues: (i) Whether the expenditure incurred on replacing cables of the flour mill plant was allowable as current repairs under section 10(2)(v) of the Indian Income-tax Act, 1922; (ii) Whether the boarding and lodging expenses of partners incurred during business tours were deductible as expenditure laid out wholly and exclusively for the purposes of business under section 10(2)(vii) of the Indian Income-tax Act, 1922.

Issue (i): Whether the expenditure incurred on replacing cables of the flour mill plant was allowable as current repairs under section 10(2)(v) of the Indian Income-tax Act, 1922.

Analysis: The expression "current repairs" is narrower than "repairs" and is confined to petty, periodic repairs. Replacement may amount to repair where it is only the restoration of subsidiary parts that have worn out, but substantial replacement or renewal of a sizeable part of the machinery does not fall within current repairs. On the facts available, the expenditure represented replacement of a substantial part of the cables and could not be treated as mere current repair.

Conclusion: The expenditure was not deductible as current repairs and the answer was against the assessee.

Issue (ii): Whether the boarding and lodging expenses of partners incurred during business tours were deductible as expenditure laid out wholly and exclusively for the purposes of business under section 10(2)(vii) of the Indian Income-tax Act, 1922.

Analysis: An expenditure is allowable only if it is laid out wholly and exclusively for the purposes of business and is not in the nature of personal expenses. Boarding and lodging are ordinary expenses incurred to sustain the person concerned, and the fact that a partner travels for business does not convert such personal expenditure into business expenditure.

Conclusion: The expenditure was not allowable and the answer was against the assessee.

Final Conclusion: The reference was answered in favour of the Revenue, with the disputed expenditures held to be inadmissible deductions under the Act.

Ratio Decidendi: Expenditure qualifies as current repairs only when it is confined to periodic and subordinate restorative work, not substantial replacement of a part of the machinery, and personal boarding and lodging expenses of partners are not deductible merely because they are incurred during business travel.

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