https://www.taxtmi.com/caselaws?id=292724 Replacement of worn-out machinery parts with new parts is ordinarily treated as repairs, so the expenditure is revenue in nature and may qualify as allowable working expenses. The character of the outlay depends on the facts: if repeated replacements substantially change the identity of the machine, amount to a substantial improvement, or materially extend its useful life, the expenditure may instead be capital in nature. The issue is one of fact and degree, to be determined from the circumstances of each case. en-us Tue, 31 Aug 1926 00:00:00 +0530 Wed, 06 Jan 2021 10:08:21 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=292724 Replacement of worn-out machinery parts with new parts is ordinarily treated as repairs, so the expenditure is revenue in nature and may qualify as allowable working expenses. The character of the outlay depends on the facts: if repeated replacements substantially change the identity of the machine, amount to a substantial improvement, or materially extend its useful life, the expenditure may instead be capital in nature. The issue is one of fact and degree, to be determined from the circumstances of each case. Case-Laws Income Tax Tue, 31 Aug 1926 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=292724