TaxTMI 
TaxTMI 
2010 (12) TMI 632
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....nbsp; "1. Whether on the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in treating the expenditure incurred on account of repair and maintenance expenses on furnace as revenue expenditure instead of capital expenditure? 2. Whether on the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in treating the cost of moulds as revenue expenditure instead of capital expenditure?" 3. In other three appeals only question no.2 is involved. 4. The assessee is engaged in steel industry. It claimed deduction under the head repair of plant and machinery. A fire had broken out in the factory resulting in damage to the furnace. The assessee effected repair to the damag....
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....et has come into existence. The effect of the repairs carried out by the assessee has been only to restore the machinery to its original condition. These factual findings have not been controverted by the department before us on the basis of any cogent material or evidence. In the absence of any material to infer to the contrary we do not find ourselves in a position to interfere with the conclusion drawn by the CIT(A). The expenditure has been rightly held to be revenue expenditure. 7. In so far as the reliance placed by the revenue on the decision of the Apex Court in the case Ballimal Naval Kishore & sons (supra) is concerned, we find that the same does not help the case of the revenue. The judgment of the Apex Court was rendered....
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....runners and risers, it is maintaining electric furnaces, in whose running the moulds are utilized. It is clear that the moulds are used in the production process carried out by the assessee. The position of the moulds in the industry of the assessee, in our view, is akin to that in a steel rolling mill. The moulds are used in an electric furnace which is run at a very high degree of temperature. In a case relating to the steel rolling mill, where also the moulds are used for manufacturing process, the Hon'ble jurisdictional High Court in the case of M/s Malhotra Industrial Corpn. Reported in 254 ITR 635 (P&H) held that the cost incurred for frequent replacement of rolls which a revenue expenditure as it did not result in creation of any cap....
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.... to Assam Bengal Cement Co. Ltd. Vs. CIT 271 ITR 34, CIT Vs. Madras Auto Service (P) Ltd. 233 ITR 468 apart from Ballimal Naval Kishore's case. . Interference by this Court is permissible only if the view taken by the Tribunal suffers from perversity. In the present case, having regard to the concurrent finding recorded by the CIT(A) and the Tribunal, it is clear that expenditure was on repairs of damaged furnace and not for replacement or restoration thereof. In Ballimal Naval Kishore's case in the facts and circumstances of that case, the finding recorded by the High Court was upheld. The assessee was running a ginning factory which was converted into a cinema theatre by making huge investment in the process of conversion. The said invest....