TaxTMI 
TaxTMI 
2014 (11) TMI 1217
X X X X Extracts X X X X
X X X X Extracts X X X X
....unting to Rs. 4,21,35,827/-. The assessee, while filing the return of income, claimed deduction of the aforesaid amount. The AO disallowed the aforesaid amount and thereby rejected the claim of the assessee for deduction. Being aggrieved thereby, the assessee preferred the appeal before the learned CIT(A), who partly allowed the appeal of the assessee. The revenue, hence, carried the matter before the Tribunal in further appeal, wherein, the Tribunal passed the impugned order. Hence, the present appeal at the instance of assessee. 3. At the time of admission, following questions of law were framed by this Court for consideration; "(1) Whether on the facts and in circumstances of the case, Rs. 4,20,66,275=00 spent on furnace is deductib....
X X X X Extracts X X X X
X X X X Extracts X X X X
....es are not allowable in respect of the gas house. She, hence, prayed that the appeal being devoid of merit, be dismissed. 7. Heard, learned Counsels for the parties and perused the material on record as well as the orders passed by the CIT(A) and the Tribunal. Before proceeding with the matter, here, it would be relevant to note that it is settled principle of law that the amount of money spent on repairs alone cannot be a factor to determine whether the expenditure would fall under the current repair or not, but, it is the nature of the repair, which is carried out by the assessee, which is to be looked into so far as deduction is concerned. In the instant case, repairing of the furnace was carried out and certain parts, such as refracto....
X X X X Extracts X X X X
X X X X Extracts X X X X
....actories had been used in these process. In this regard, the representative of the appellant produced the necessary photographs, showing the laying of the refractories, having formed holes with minor tolerances wherein steel material are used to keep them in position. In view of the fact that all the refractories had been used in the process of repairs during the year under consideration, the same are not required to be included in the closing stock. 10. In view of the above discussion, the expenses on repairs has to be allowed as a deduction during the assessment year 1992-92. 11. The Assessing Officer has made a passing remark that the assessee could not produce all the bills. The representative of the appellant claimed that this st....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed, therefore, total expenses of cold repair works are treated as allowed except Rs. 69611/- mentioned above. Therefore, the appeal on this ground is allowed for a sum of Rs. 42066275/- (Rs. 421135887 (-) Rs. 69612). In the result, the appeal on this ground is partly allowed." 8. As against this, the Tribunal, while passing the impugned order, has recorded that the expenses in question incurred by the assessee on dismantling the old furnace and construction of a new furnace are clearly capital in nature, which is not supported by the factual matrix. 9. The Apex Court in "CIT VS. SARAVANA SPINNING MILLS P. LTD."(Supra),wherein, the Apex Court held that to decide the applicability of section 31(i) the test is not whether the expenditure i....