2015 (9) TMI 963

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....nt and ITA No.800/CHANDI/2005 of the revenue for the assessment year 2002-03. This appeal was admitted on 28.4.2010 to consider following substantial questions of law:- a) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified on facts and in law in confirming the findings of the authorities below while denying deduction to the appellant society of its income under section 80P (2)(a)(iii) of the Income Tax Act, 1961 despite the fact that the issue stands referred to the Full Bench of this Hon'ble Court in ITA No.232/2003? b) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified on facts and in law in confirming the ....

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.....3.2005, Annexure A.3. Aggrieved by the order, the assessee filed appeal before the Commissioner of Income Tax (Appeals) [CIT(A)]. Vide order dated 14.7.2005, Annexure A.2, the appeal was partly allowed. Both the appellant and the revenue went in appeals before the Tribunal. Vide common order dated 28.5.2008, Annexure A.1, the Tribunal partly allowed the appeal of the assessee and dismissed that of the revenue. Hence the instant appeal by the assessee. 3. We have heard learned counsel for the parties and perused the record. 4. It was urged by learned counsel for the revenue that so far as question No.(a) is concerned, the same does not arise. A perusal of the order passed by the Tribunal shows that the assessee had not claimed deducti....

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....ndary wall. Learned counsel for the assessee was unable to substantiate that the said expenditure would qualify as revenue expenditure in the facts and circumstances of the present case. The finding recorded by the Tribunal reads thus:- "24. The facts relating to this issue are that the assessee had incurred expenditure of Rs. 5,38,718/- on repair and replacement of machinery and boundary wall. The Assessing Officer treated the entire expenditure as of capital nature and after allowing depreciation, the disallowance of Rs. 4,84,847/- was made. The Commissioner of Income Tax (A) has confirmed the disallowance. The learned counsel for the assessee contended that the disallowance is unwarranted as the entire expenditure has b....