Current repairs versus revenue expenditure on plant and machinery was decided in favour of the assessee under income-tax law.

The dispute concerned whether amounts claimed for plant and machinery items qualified as current repairs under Section 31(1) or as revenue expenditure under Section 37(1) of the Income-tax Act, 1961. The analysis turned on the factual findings of the lower authorities about the nature of the items purchased and relied on Commissioner of Income Tax, Madurai v. Saravana Spinning Mills (P.) Ltd., which was treated as supporting the assessee's claim. The question was answered against the Revenue and in favour of the assessee.

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Issues: Whether the amount claimed by the assessee was allowable as current repairs of plant and machinery under Section 31(1) of the Income-tax Act, 1961, or as revenue expenditure under Section 37(1) of the Income-tax Act, 1961.

Analysis: The issue was examined on the basis of the findings recorded by the authorities below regarding the nature of the items purchased for which full deduction had been claimed. The controversy was held to be covered by the Supreme Court decision in Commissioner of Income Tax, Madurai v. Saravana Spinning Mills (P.) Ltd., which supported the assessee's claim.

Conclusion: The question was answered against the Revenue and in favour of the assessee.

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