, `'
IN THE INCOME TAX APPELLATE TRIBUNAL
"E" BENCH, MUMBAI
, ,
BEFORE SHRI SANJAY ARORA, ACCOUNTANT MEMBER AND
SHRI AMIT SHUKLA, JUDICIAL MEMBER
. / ITA no. 1557/Mum./2013
( / Assessment Year : 200910)
Asstt. Commissioner of Income Tax (OSD)
................. /
Circle2(3), Aayakar Bhavan
101, M.K. Road, Mumbai 400 020 Appellant
v/s
Satguru Insfocorp Services Pvt. Ltd.
................... /
Sunteck Centre, Subhash Road
Vile Parle (E), Mumbai 400 057 Respondent
./ Permanent Account Number AAECS6683A
/ Revenue by : Mr. Maurya Pratap
/ Assessee by : Ms. Vinita Shah
/ /
Date of Hearing 22.05.2014 Date of Order 22.05.2014
/ ORDER
, /
PER AMIT SHUKLA, J.M.
The present appeal has been preferred by the Revenue
challenging the impugned order dated 11th December 2012, passed by
he learned Commissioner (Appeals)VI, Mumbai, for the assessment
year 200910. The effective grounds raised by the Revenue are as
under:
Satguru Insfocorp
Services Pvt. Ltd.
2
"1. On the facts and in the circumstances of the case and in law
the learned CIT(A) erred in holding that the amount of `
38,81,321 under the head "repairs and maintenance expenses"
and the amount of ` 59,75,995 under the head "furniture and
fixture" are the revenue expenditure.
2. On the facts and in the circumstances of the case and in law
the learned CIT(A) failed to take into account the ratio laid down
by Hon'ble Supreme Court in the case of Sarvana Spinning Mills
as reported in 293 ITR 201."
2. At the outset, the learned Counsel, Ms. Vinita Shah, on behalf of
the assessee, submitted that the learned Commissioner (Appeals) has
followed earlier year's appellate order for the assessment year 200506
to 200809 passed by learned Commissioner (Appeals) and also the
Tribunal order for the assessment year 200708. He further submitted
that the Tribunal has decided this issue in favour of the assessee in the
assessment year 200708 and 200809 also.
3. The learned Departmental Representative also admitted that this
issue stands covered by the decision of the Tribunal in assessee's own
case.
4. After carefully considering the relevant finding of the learned
Commissioner (Appeals) and also the Tribunal order dated 29 th
December 2011, passed in assessee's own case in ITA
no.6060/Mum./2010, for the assessment year 200708, a copy of
which has been placed on record, we find that the issue of disallowance
of claim for the repair and maintenance expenses has been the issue of
consistent dispute coming from the earlier years. The Revenue's case
has been that the expenditure under the head "repairs and
maintenance" on building, fixtures and furniture is "capital" in nature,
whereas, the assessee's claim has been that it is revenue expenditure
Satguru Insfocorp
Services Pvt. Ltd.
3
incurred for the business centre run by the assessee which has been
taken on hire from MMTC Ltd., Mumbai. The Tribunal has decided this
issue in favour of the assessee for the assessment year 200708 in
assessee's own case after observing and holding as under:
"8. We are of the considered view that the learned CIT(A) has
rightly stated that considering the total block of furniture and
fixtures amounting to ` 5.25 crores, the repairs and maintenance
expenditure of ` 60 lakhs could not be stated to be
unreasonable, particularly when the furniture and fixtures were
being used for business centre. The learned CIT(A) has stated
that furniture and fixtures at business centre require inherent
higher maintenance expenditure as business centre are used by
a large number of people for commercial purposes resulting in
higher wearandtear of the furniture etc. The learned CIT(A)
has further stated that the assessee itself had capitalized a sum
of ` 28 lakhs approximately on account of new furniture and
fixture. The learned Departmental Representative has also not
disputed the observation nof learned CIT(A) that in preceding
years i.e., assessment years 200506 and 200607, similar
disallowances were made by the Assessing Officer and were
deleted by the first appellate authority. At the time of hearing,
learned Departmental Representative could not state as to
whether the department had accepted the said orders of learned
CIT(A) or not.
9. Considering he above facts and also considering the decision
of Hon'ble Rajasthan High Court in the case of CIT v/s A.M.
Sanghvi, 302 ITR 26, wherein it was held that even if the
substantial amount is spent on repairs and renovation of office
premises taken on rent, it is to be allowed as revenue
expenditure because no capital asset is acquired by the
assessee. Hence, we hold that there is no infirmity in the order
of Ld. CIT(A). Therefore, we uphold his order by rejecting the
grounds of appeal taken by the department."
5. The aforesaid order of the Tribunal has also been followed in the
assessment year 200809. Since identical facts are permeating in this
year also, therefore, consistent with the view taken therein, we hold
that the expenditure claimed by the assessee is to be treated as
Satguru Insfocorp
Services Pvt. Ltd.
4
"revenue expenditure". Consequently, the grounds raised by the
Revenue are dismissed.
6.
6. In the result, Revenue's appeal is dismissed.
22nd May 2014
Order pronounced in the open Court on 22nd May 2014
Sd/- Sd/-
SANJAY ARORA AMIT SHUKLA
ACCOUNTANT MEMBER JUDICIAL MEMBER
MUMBAI, DATED: 22ND MAY 2014
/ Copy of the order forwarded to:
(1) / The Assessee;
(2) / The Revenue;
(3) () / The CIT(A);
(4) / The CIT, Mumbai City concerned;
(5) , , / The DR, ITAT, Mumbai;
(6) / Guard file.
/ True Copy
/ By Order
. / Pradeep J. Chowdhury
/ Sr. Private Secretary
/ / (Dy./Asstt. Registrar)
, / ITAT, Mumbai
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