2010 (9) TMI 156

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..... Whether the expenses incurred by the assessee towards errection of boundary walls, construction of tanks, construction of roads etc. under the nomenclature Maintenance of market yard (Civil) and Maintenance of market yard (Electric) are to be treated as Capital or Revenue? 2. At the very outset, we may note that in the memorandum of appeal, number of substantial questions were raised but at the time of admission, the learned counsel for the revenue as well as the assessee fairly conceded that the only question that really survived for adjudication in this appeal is the question that has been framed. Thus, we shall filter the facts from the orders relating to the said facet only. The assessee namely, M/s Agriculture Produce Marketing Co....

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....ctrical) being capital in nature whereas the assessee had debited the same in the Income & Expenditure account as the expenses were revenue in nature and were recurring expense. 3. At this juncture, we may refer to the view expressed by the CIT(A) which reads as under:- "B.4 In the light of the above principles the nature of expenditure incurred by the appellant is examined and the following items of expenditure to the extent of Rs.86,04,618/- are held to be revenue in nature:- (i) Major repair of road (exit gate NSM) - Rs.2,74,253/- +Rs.9,55,579/- + Rs.2,01,135/- + Rs.76,618/- = Rs.15,07,585/- (ii) Major repair of footpath (D-Block NSM) - Rs.2,22,765/- + Rs.6,99,739/- + 9,22,504/- (iii) Improvement work of the market RCC UG ....

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....POMA shed NSM - Rs.4,42,595/- (n) Installation of tube wells at NSM & NFM -Rs.6,34,392/- (o) Construction of sewerage lane at NSM - Rs.4,77,033/- (p) Electrical expenses on market yard - Rs.6,17,040/-" 4. To arrive at the aforesaid conclusion, the CIT(A) has placed reliance on Ballimal Naval Kishore v. CIT, (1997) 224 ITR 414 (SC), SENAPATHY Synams Insulations (P) Ltd. v. CIT, (2001) 248 ITR 656 (Kar.) and CIT v. Norht Dhemo Coal Co. Ltd., (1977) 106 ITR 592 (Cal.). 5. The tribunal, after referring to the submissions, has held as follows:- "10. Learned counsel for the assessee in reply contends that the assessee incurs expenditure under various heads as it has to take care of so many marketing yards. The same includes repa....