2017 (6) TMI 243

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....nging the order of Ld.CIT(A) in directing the AO to add Rs. 10,35,717/- being replacement of some portion of the machinery to the income of assessee. 3. The facts of the issue are that the assessee herein claimed an amount of Rs. 10,35,717/- as replacement of item of machinery in its return of income. The AO allowed the same while passing the assessment order u/s.143(3) of the Act on 24.12.2008 accepting the return of income. Later, the mistake, in this order, of adopting the return of income at Rs. 2,97,25,382/- was rectified vide order u/s.154 of the Act dated 08.02.2010. Further, there was a proceeding u/s.263 of the Act by CIT-3 vide his order dated 07.03.2011 wherein he has given a direction to ld. Assessing Officer to add Rs. 10,35....

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....placement. Therefore, a new wire rope hoist was procured which replaced the same. Further the assessee incurred Rs.  1,08,935/- on a hoist used for handling the pattern for inspection which was very old and could not be put to use any further and needed replacement. Therefore, a new wire rope hoist was purchased which replaced the same. The assessee also incurred an expenditure of Rs.  1,36,599/- on a hoist used for handling the casting for loading into the Shot Blasting Machine. This hoist had become very old and could not be used any further and needed replacement. Therefore, a new wire rope hoist was procured and the same was replaced. The ld. A.R of the assessee submitted that after examining these details, the Assessing Offic....

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..... (293 ITR 201) has mentioned two exceptions in which replacement could amount to current repairs, namely: where old parts are not available in the market, or where old parts have worked for 50-60 years. In the instant case, the assessee had not claimed either of the above stated exceptions. Hence, the assessee's claim of deduction u/s.31 of the I.T.Act cannot also be accepted." 8. We find that the ld. A.R of the assessee could not point out any specific error in the order of the ld. CIT. It is not in dispute that the expenditure in question was for replacing the machines with new ones. As no error in the order of the ld. CIT could be pointed out, we do not find force in the above argument of the assessee. 9. However, as the expen....