Current repairs under tax law exclude renovation that creates capital advantage and enhances an asset's value.

Expenditure on renovation was not deductible as "current repairs" because current repairs mean ordinary, periodic maintenance of an existing asset to preserve it in working condition. Costs directed to renovation, improvement or replacement that create a new or different advantage, or amount to capital improvement, fall outside that expression. On the facts, the cinema-hall expenses were separately booked as renovation and were found on evidence to be substantially capital in nature, incurred to make the halls more attractive and comfortable and to enhance their value and earning capacity. The claim accordingly failed.

---

---

Issues: Whether expenditure incurred on renovation of cinema halls was allowable as a deduction as current repairs under section 10(2)(v) of the Income-tax Act.

Analysis: The expression "current repairs" was held to mean repairs to existing buildings, machinery, plant or furniture undertaken for maintenance and preservation in the ordinary course, with an element of periodicity and need. Expenditure directed towards renovation, improvement, or replacement creating a new or different advantage, or resulting in capital improvement, was distinguished from current repairs. On the facts, the expenditure had been separately booked as renovation, and the departmental authorities had found on evidence that a substantial part of it was of a capital nature and was incurred to make the cinema halls more attractive and comfortable, thereby increasing their value and earning capacity. Those concurrent findings of fact were not shown to be unsupported by evidence.

Conclusion: The renovation expenditure was not allowable as current repairs and the claim failed.

Ratio Decidendi: For section 10(2)(v), current repairs are only those ordinary maintenance repairs needed periodically to preserve an existing asset in its working condition; renovation or expenditure yielding a capital advantage is not deductible as current repairs.

---