TaxTMI 
TaxTMI 
TaxTMI 
2019 (7) TMI 677
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.... under :- "4.8. I have considered the facts of the case, submissions of the appellant and order u/s 143(3) r.w.s. 254 and also the remand report of the AO. First of all, the AO in the order u/s 143(3) r.w.s. 254 of the IT Act has not brought out any material on record to establish that the various parts of machine as described in earlier paragraph of this appeal order were independent machine giving enduring benefit to the appellant. The direction of Hon'ble lTAT, Ahmedabad as given by it in ITA No. 1464/Ahd/2007 in the case of appellant was very clear. As per the Hon'ble ITAT, Ahmedabad on perusal of assessment order in which it has been written that Rotor Assembly is a part of X-701 Turbine, was broken and was required to be replaced by new Rotor to run Turbine. As per the Hon'ble ITAT, Ahmedabad its justification was given before the AO also. As per the Hon'ble ITAT, Ahmedabad similarly, that the gas chrornatoqraph, the matter required examination whether the parts so replaced were independent machine or were parts which required to be fitted in place of broken parts of the Turbine. As per the Hon'ble ITAT, Ahmedabad the clear findings were required to be given by the AO whic....
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....e Rotor, Gear Shaft with Gear Part and Nozzle Ring are not independent parts capable of functioning of independently. Thus, it can be said that the AO in his remand report has accepted the fact that Turbine Rotor, Gear Shaft with Gear Part and Nozzle Ring are not independent parts capable of functioning of independently. Considering all these facts, it is held that the expenditure incurred by the appellant on account of replacement of Turbine Rotor, Gear Shaft with Gear Part and Nozzle Ring are not capital expenditure as the same cannot be treated as independent machinery in itself and they are not capable of functioning independently. In view Of this, the A0 is directed to treat the expenditure incurred on these Turbine Rotor, Gear Shaft with GEAR Part and Nozzle Ring as revenue expenditure and accordingly allowed the same. 4.9. As regards another part i.e. 415V, 3000AMP, 3PH - 40W PMCC for CHP, the AO in his remand report has not given definite finding by bringing the materials on record. On the basis of report of the Inspectors, the A0 after discussing technical aspect of this part of machine in his remand report has finally stated that this part was not visible outside but l....
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....his the AO is directed to allow the expenditure incurred on replacement of panel i.e. 415V, 3000AMP, 3PH 40W PMCC for as revenue expenditure." In result, the appeal of the appellant is partly allowed." 4.00. The aforesaid findings recorded by the CIT came to be affirmed by the tribunal holding as under :- "6. We have heard the rival contentions and find that the issue is covered by the earlier orders of ITAT in ITA No.1363/Ahd/2013 dated 17.05.2018 for A.Y.2009-10 and earlier orders as mentioned in the order of Tribunal in para 13 to 17 which reads as under: "13. Brief facts of the case are that the assessee incurred expenses of consumption and replacement of stores and spares of Rs. 9,548.68 lakhs and claimed the same as revenue expenditure. However, out of that, the Assessing Officer (AO) has disallowed Rs. 3,00,96,651/- treating it as capital expenditure after allowing the depreciation of Rs. 45,14,498/- thereon. The AO has made disallowance of net amount Rs. 2,55,82,153/- on the ground that the items are in the nature of independent machine and average life span is 5 years or more and in one item life span is 20 years which suggests that these items can be used indep....
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....ions and find that the issue is covered by the earlier orders of ITAT in ITA No.1363/Ahd/2013 dated 17.05.2018 for A.Y.2009-10 and earlier orders as mentioned in the order of Tribunal in para 13 to 17 and Tribunal of Surat bench in I.T.A.No.1060/Ahd/2015 A.Y.2003-04 dtd. 27.09.2018 (copy filed) in assessee's own case. Since facts of this year are also same as in A.Y.2004-05 as discussed above for the assessment year 2004-05 by us. Therefore, following the same We dismissed the appeal of Revenue on this ground. Further, reliance placed In the case of Sri Mangayarkasi Mills (P) Ltd (supra) is not applicable, as in that case replacement of old machinery with new machinery was treated as capital expenditure, whereas, in the instant case, there is replacement of damaged part of conversion for pump block, set of impellers, Naraxno, hence, facts are distinguishable. Therefore, the appeal of the revenue in respect of Ground No.1 is dismissed." 5.00. Having heard the learned counsel appearing for the parties and having gone through the materials on record, the proposed question is no longer res-integra in view of the judgement of this Court in the case of the very same assessee rendered i....