Commissioner Of Income-Tax, West Bengal-Ii, Calcutta v. Kalyanji Mavji & Company

AIRE MARA, TRARY SATAY, TATA aad wea sit araet Ges Tega(Commissioner of Income Tax, West Bengal-I..Calcutta M/s. Kalyanji Mavij and Company)(14 waazt, 1980): (ratarftafa ro Ueto Heatftat BIT AITe Yo WSF) —ogfusaa genet dea Taz, 1922 (1922 BT 00) aTer 10°(2)(Vv) aat 44 (2) (XV)—“adara aera” qa aitsurfta—faatfedt st afaaget stag arafaat & ata far-STA H TTTTEA TY HATE ANT aaa BJ aazitar at cayfeatatat—faatica er Ga sana feo ageam se ata “adara-quad Rema & wT H sett er arat—vat-eqa aaAtaazena az fat aat oma 2 faaat ag are 00 (2) (V) F°aeite watet HRA HT BHATT B ae ara-we feats Ta faq aT -Say TT HL STIS AR STATA— AI TE STATER ave (V)& qela weldt st we ateil “adart aceaa” agt g, Taat-malet Seta a qa ena Haat mat g, wafer ave (XV)Beata Bt ATA | fratfedt ca tfsedtea GH @ ate ofeah gare aur fagre a -aie TAT Gat al ear eSBANAH Haar aa asa aaa”atfaatt & ara & ara 21 arsa amar aifead 1942 8 dar s weyHd ate 19550 sym es ai alan sex sl aaia F aterafaaifedt F Afaad at aaa area eqaan eaifaca—faad yfa arfecat az zaura awa ala HATA F Aaa afeafaa g, axa fearary Xara qraHr Haart F HIATT aaa F SIH aya ATAaAT~gitr alae ala He seas fae aay F ovata faatfedl + ataar ara” Te 1,61,742 era at cH ate tHe art aforal a fer ad ancedBU BY ghee & oq ati fraifedt X area areae afafiae atare 10 (2) (XV) ¥ elt 1,61,742 wrt a cH By weld & fararat fear, farg ga welit at area afaerad ara sa arate aeTAT BC fear war fie arya safe sr ary arte H ATH ANTATH A Be aa at gfe at fe oar qarvafe wr cag aT) HART TSTaaa at seal Uae far as sea fafacs fear fe “agraaeat ate ofefeafaal ¥ araacadia afyecr a ae afafaatferBAT aAfaa at fe aAaT HAT ae 1,61,742 Vad aT ararHaaay aa Tata ST ar?” sea aaT A ag aa afar Fara fafratfedl azray ara Bret HT VET aT alte ae ofefeahs fe aaqial i & on Fag adt tar at, vas areat® watay sara ratstaat it 1 gaa eqratayag vt afafraifea fear fe edtea sarTE TT Tea H arene ge ag sal Har st THAT FH 161,742 ead aTHera faaifedt & Meas afer afaa at it gaa qe aa areas.frat fe ag ora faatfeal areas ada ager at areasatsare frat war ot a far frat 8 TAT HY afta Bey F fau atfe afeaca Fag} ari agar, gaa aa tt afafaetfea Prat feqaeae Uaea eay By safe aT at ale gafee fratfedt & cer F cea arSat fear) seq araay % fig H fees seaaa aaa a adaal 1g, atte ares HA BU FaATTA SIT,:|afafratica—ea ara ox Hx fart war fis afe are 10 (2) (V}fratort atc aaita at ara ARH It eae H araeey H fafatecr seagait & HITT BATT aes A are 10 (2) (XV) at aaare Farrarafaa tél S| ate 10 (2) (XV) wa aaface que a atx He eqayt Ttaea FF TT aT 10 (2)¥ qaadl Peet que Fafma as garmetg | ATT 10 (2) (V) Fae ay aUeMaTH aera FH!) are 10(2) (V) a fara-aeg ‘are aera’ g atte ga ata & aena Alar aftSeilet Sar s feTVET Hara aTeMa” wal F, saa wet ® fararava fagreat te ar are 10 (2) (XV) ¥ aha farare aal fararat atfag | ga dae Haga das area drat aifee fH dat qeeNat& aaa ¥ fearaavsea er area ga faara 2 aan ot fe ae tarony faa arqart get & Ht frat war st aera arate ¥ gatasTT wee ale TaH BTA or Hz fear qa a ate at aa cst safer. [1980] 4 3A° fro To ar add, Breare S ara AY ATT HUA A GAT metal fae at ategaraa vat at arat arf 1 aret 10 (2) (V) ar ata a arg tat attaa & stag ator weet a array fava st firaa faafera Br a Feafaaa dar at fe ate atenat & fat aera sa faata TATA:ad anett oral) talaga aiftfsan cafa war earay fagrat #.aIgee TX Baar HITATEHTH 2aTTATA TY Pat az gtftaat Bh Herel & sua ara} a at sats stat arta rarest | (Fz 6) 758 COMMISSIONER OF INCOME-TAX, WEST BENGAL-IT, CALCUTTA KALYANJI MAVJI & COMPANY January 14,. 1980 [N. L. UNTWALIA AND R. S. PATHAK, JJ.] Indian Income 1ax Act 1922 (11 of 1922), Ss. 10(2)(v) & 10(2)(xv)-Assessee d1Jing business in coal-Working various collieries--One colliery requi~ sitioned for n1ilitary use-Later cferequisitioned-Expenditure incurrred far re~ suniing operation of Colliery-Whether capital or revenue expenditur~. The respondent~asses.&ee carried on business in coal as the owner of various collieries. One of the collieries, was' occupied by the niilitary from 1942 until it was derequisitioned in 1955. During that per)od the assessee did not work the said colliery : M.though the business in coal and working of the other collieries were carried on. While the colliery remained under military occupation the assessee incurred expenditure in respect of the colliery on account of payment D of surlaco rent, minimum royalty and; sala•ry for the watch and ward staff, which expenditure was claimed and allo\ved as business expenditure\ of the assessee. After the colliery was handed over to the assessce upon dorequisiticn the assessee incurred an expenditure of about Rs. 1.6 lakhs in renovating the build~ ing, reconditioning tha machinery and. clearing the land of all debris accumulated over a number of years. In the assessment proceedings for the assessment year 1959-60 th~ a8Se,s.iee claimed deduction of the aforesaid amount under section 10(2) (xv) of the Indian Income Tax Act. The deduction was disallowed by the Income! Tax Officer on the ground that the expenditure was capital in nature~ The appeals by the assesseei to the Appellate AssistMlt' Comn1issioner and the Income Tax Appellate Tribunal were dismissed. In the reference to the 1-Iigh Court· at the instance of the ·assessee 'the High Court observed that the business of the assessee had to be considered as a wholei and not on the basis1 of its different sources of supply or units of produc-tion, and held thM: on the facts admitted and found it could not be said that any fresh asset had been acquired by the assessee by spending Rs. 1.6 lakhs G and that the expenditure: was incurred by the assessee for the purpose of carrying on an existing concern. The expenditure was, therefore, in the nature of a ·revenue expenditure. In the appeal by the Revenue to this Court, it wao contended : (a) where repairs are effected to buildings and machinery a deduction under section 10(2) is permissible only in respect of "current r~pairsl' and, repairs which are not H '1current repa-irs" are not intended to be the subject of relief, (b) the repairs made by the assessee cannot be described as "current repairs", and (c) if section 10(2) (v) is the relevant clause, being the specific provision in respect of expendi- ture on "current repairs" to buildings and machinery, there is nu justifiration for relying on section 10(2)(xv) a residuary clause. Dismisoing the appeal, HEI.D: I. The High Court Wa.9 right in holding that the expenditure was eot of a carital nature. [764 EJ 2. The expenditure of Rs. 1.6 Jak.hs was expenditure laid out. as part of the process of profit earning. The nature of tho expenditurr. was clearly revenue in characfer. (764 DJ 3. There can be little doubt that the expenditure incurred was incidental to the business of the assessee. It was involved in renovating the buildings, recondi· tioning the m&.<::hinefy and clearing the debris~ fron1 the land, for the purpose of resuming the operation of the co1liery. The expenditure \Vas laid out wholly for the pUrpQSe of the business. [763 DJ (Fz 6) guia eax fraifedt & arzare ar rafts era @ galfay are 10(2) (XV) ary aeat Si wee cet ag she Far eA eT AY Taitgata} ame eth aaa a THAT gs Fall az arg ay art 10(2) (RV) BT Bra STH ATATTT faaredl & agare ret fear aTATaarfat | sega aay H faatfedt ar areart wae ara aT, AIT Agaera arate Sareea arer Par ar TNl aT | Mea BATA STAT TATAarom una atsafe seared & aH THR ae A ATT HTTATT ATWl A, Tt FAN S Haar TH CHF ATT TAT HraITe Bl Barsat Vafeat aaraty agararat weet fe a faarar te aaah far geadits ga arate ar afaman ara dfs sata & fare fear var aT,aa afaa vat frat var ary aa at ag acai shame ae Fe a agat dt fratfedt 2 ay er seated fae Rawr Foor fats saarareti BY Ge BAT HAIG AT TT HS TAA H fer Hr HUH St Faren sega at ag atfaatort ar ade fear ar ar, Aaa ATgaat argag ft atc afar saat gfe ae gerarwa aT wearHaat aa a va featsF ara war at st sera H faq aaaftare ae anfer afeaca H ret ad TE a, HTLATT HT HTAaT Tarr& fae ae are aise adl fear wat aT) ag Hr-wATT GT TTTfaaratte ar freg seatwr F Caw fear war ar, Ga HHT A ATA HATat) ag navadia & fe frareredta ag & altar ale GAT Ha areal watay afat. aed fe maar ara at oH freay BITATT HY afer aequatan ata sex a aaft Falta a TF ata e eq FMuar WaT aT SY eTaeTe ateaarar & fe Ga safe Rater Prattgit Baar arate araFH saat cag at sas sraart frateatarqaa metal Fea H aigqe frat war ary sega are FH ferareeita4,61,742-808 Br ore ATT HATA aT PRAT H ATT TFET fraifca — AART BIT To AAT TEAM st AAs Tas yo 19. _ Commissioner ofInland Revenue). ..es ie fafa atte aferatfcat : 1972 at fafaer acta eat 2098 1965% araaz fem deat 109 F HeHAT sea eaIATAT5-8-1971 ara faa ate aie & fag fare aaraa saat at TE azANT | aiaAe a«=—«-A Sto to Gea, A Fo TATAlA,HATA Vo gaifaattMETAL Bl AMTa} UAo ATLo Tas, MAT sex TATATaie aft afaee faratar afare-afsagataiatates= gard wo garfaotheat BT AT Aaft Co faatat eaTaraa wt fara eararfarafa atxo Cho TSF > feat || sararfatata Wes — area aaa afaftaa, 1922 at are 66 H (2)setaPAPA TSI rAAAT ETT AAT-TA AH al Ag as adta artaSamed, 1971 art facia & fase fatina= fae aver we araazfader ar faqeret fear wat ati 2. seat faatfedt ca efaectaa Gas atcafeadl sareamt fare a aaa alaar eral ateart gi sas ava Hava aaaise ana alae F ara a wasArTsy aaa Hfaad 1942.4Barwe AT ate 1955 A segHge atShan ey a wafer hater faeifedt + alfaadl at arad da eqaan carfaea—faad yfaal fata att aura set ater waaftal % Aaa afeafaa gs, eaafrat any & cary raat Hrdarigat & arcane aay] STH AAT aT|Bar are alsa ara s See fag ara Fasara fratfedt a sat@TIT1,61,742 eat at WH ate can aaa: afearal ay fat aares HA HT Zier J ary stA eae gana Frater af 1959-60fae 24 qaqa, 1957 A AeA ser ara| 1 TAFI, 1958 BY aATeTala are gaadh wafer & eter sata fear war att ga frat agfac faaton ararfeat + faatfedde area aaa afafaag at \-aN ate 10 (2) (XV)watt 1,61,742 wat Bt wwe at weta ®fearg ara frat, freq ge wetdh at rane afar gre sa aTatz atATATT He fear war fe eae aa aafa at aT ata Haga attaTAT Ta are a Gfes at Ps exe yor gaft wt ear ary fratheadt®gad ada a, Pree aaat atta afar § cag aE aan faa faarat ara sifrarfeat & ara ata agate Meas we a 1 fratheds aSapa seq aaTaa a farafafaa ge ie saat wae fav feeafasrce frat— “aot amet & aeat ate ofefealaat & araaz atta afa-HUT al ag afafraifer azar aaa ar fie amar afarTT 1,61,742 ead ar erarHe aay qe safe aT ar?”Seq eaaraa 4 farafafead qeat ox faare feat— 4. There must be stroug evidence that in, the case of repairs which arc not "current repairs'' the Legisl<c1ture intended a depc:·rturc from the principle that an expenditure iaid out or expended wholJy and exclusively for the purposes of the business, and which expenditure is not capital in n<:.•ture, should not be allo'ved in computing the incon1e from business. There is nothing in the language of section 10(2)(v) \vhich declares or necessarily implies that repairs, other than, "current repairs", will not qualify for the benefit of that principle. On accepted commercial practice anJ trading principles an item of business expenditure must be deducted in order to arrive at the true figure of profits and gains for ta·x purposes. [762 G-763 AJ C.l.T. v. Chitnis 50 I.A. 292; Mo'tipur Sugar Facto1y Ltd .. v. C./.T. Bihar and Orissa, 28 I.T.R. 120; Devi Fibns Ltd. v. C.l.T. /rrfadras, 75 I.T.R. 301; Badrldas Daga v. C.1.T. 34 I.T.R. 10, 15; Calcutta Co. Ltd. v. C.l.T. rv·csl Bengal, 37 I.T.R. 1, 9; Ihe Law Shipping Co. Ltd. v. Con1111issioners of Inland Revenue 12 Tax Cases 621, 625 referred to. The scope of Sectien !0(2)(xv) should be construed liberally. [763 BJ Jn the instant case even if the expenditure n1ade by the assessee cannot b~ d~cribed as "current repairs" he is entitled to invoke' the benefit of s. 10(2) (xv). [763 CJ 5. \Vhether a·n expenditure can be described as capital or revenue falls to be decided by several ti?'sts, each one of which approaches the question from oae perspective or another, conditioned by the particular facts of each case. [763 FJ Assam Bengal Cement Co. Ltd. v. C.l.T. West Btngal (1955) 27 I.T.R. 34 referred to. In the instant case the business of the as.Sessee· was coal mining and it was carried on by th~ Operation of a networ~ of collieries. Each colliery was a unit of production. \\'hile the several units of production continued to be employed and the business continued to be carried on, one alone of all the units, was compelled to suspend production. The suspension was due to the property be.ing requisitioned for military use. As soon as it was derequisitioncd the a'8CS"See I l-9ISCil80 A took measures to resume production of coal. The buildings were renovated, the machinery reconditioned and the accumulated debris removed from the la.nd No new as~ct was brought into existence, no advantage for the enduring benefit of the business 'vas acquired. The activity which was continuously in operation but had been te1upora1y suspended was resumed. [763 G-764 CJ OyIL APPELLATE JURISDICTION : Civil Appeal No. 2098 of 1972 B From the Judgment and Order dated 5-8-1971 of the Calcutta High Court in Income Tax Rderence No. 109 /65. D. V. Patel, ]. Ramamurthy and Miss A Appellant. Subhashini for the c S. R. Banerjee, Mrs. lndu Goswamy and Arvind Minocha for the Respondent. The Judgment of the Court was delivered by PATHAK, J. : This appeal by certificate granted by the High Court D at Calcutta under s. 66A(2) of the Indian Income-tax Act, 1922 is directed against the judgment dated August 5, 1971 of that High Court disposing of an income-tax reference. 3. fraifedt fafara Raat art Feary Fe A Has atPITA HT WET AT | ASA AHA atfaad MY sat aww Mf, 194281955 4 sae afaraan aaa sa aH Aart H mex Htsa safes ®alasaafa & faatfcat art arrar aay HAe art Hr ar HILaIe art adh Waa ac aar ATT ari sey aft Herat gat |Tal va BTela We tat at) fra aaa arse aaa afara dar ah Hey F at,fratfedt & sata ar facrar ate ga saat ara h araa Heqaaaealfaes HT Gara HU Tar Saura wea ara Hdarheaee F Faq gzcua far ati ag aay faatfedt & areart cag 8 STH aia aa arat agate fear war araera arr & afeasn ahaa Fae sz atefratheat at att art & ova fratfedt & gama sacs dtera faratoral AREAT BUA AAT BY aA ea FA ate aatw aul a ahaa aaaa yf at are BUA TT 1,61,742 waa aaa few Ft1,61,742 waymeat ayes ate ange & Aas ate aeefal ate area Gayaa fafart wos, waits a aeraa, HAT a aha at aes anfe az66,937 wa at feu me} atx fatter qeerdl, ashat a cena,areal at aera amfe Gt 94,805 aaa at tHe oft afeafaa % 1 ag eafratfedt arer ait a art ay feafe Xa gar saan art. BT etfeafa Hart Foard fearaar at feat @qaa afeart faraATT BT AT AH | BIAT ATA BT HA Tar Gas ahead gata ad Faera Ga: aren aa gS a geqan rarateta frie afaat [1980] 4 aHo fio qo 4 get eaarar a ag aa atreas fear fa fratfedt atraz| ATAT HIRATT HT TET AT atc ag gfefeafa fe tren eral Fa TH aard Agta TIT, SAH BILATZ BeaaT TT TATA Tal Stat aTsea cara a war fa fateh Hreare BT CHAT TART STAT aafe gan sah fafaea etal ar setaa & cael F Aare TTser araray a ag at afafratica feat fe cata ga ary TeteatRB mrene re ay al HT AT THAT PH 1,61,742 BIT aT FTF frat-Fedt & HE TE afer afta Ba 1 TAA ag na afer fear fH 4gaaa Faeaifeat arer ua aeara TATA BT ATL HLA H TATSTATT FATwat or a fe fret Wager states Hes faq sf aferca Fwat AT 1 Taqare, sar ae at afafrathear Fear fe ae ora Tees eaat sata ar at ate safer fratfedt & cer & yea wr Tat fear | 5. eat F uses aU TTA aH ae FT Te[2][ fa][ seq]surat H Tea TAT AY Ga: TET HA AY afersrfear at at atte gafan aay H eawer at saat frond gfe & 1 ae-acitear areata FT TAfqaat Tea mata A aaara faa 2, cas sala Aga tersay aTHT Hirata are Te TT Tea1 BA MAM Seller Hl CE TTA® ars feafearae sete, 6. fetta aata ae 8 fe fraifedtaac afafaaa at“are 10(2) (Vv) ¥sft fade e a fe are 10 (2) (XV) & wfetfate a faare Prat sat argc1 ge ara ge Gre feat war fe ate“qret 10 (2) (V) Frater atte aafta at ary reena Ie aaaaatett“fafa fase sraea DAH aren gana avs F aT aret 10 (2) (XV)ar qacta Bar earatfaa vat B11 are 10 (2) (XV) cH afafase aos& ate get rat Harare HF 1 Fare 10 (2) ¥ Taare fet avsafoa até war addi fader ae @ fe set fratot ate aeta aTarena Ht ara 2 at metal arer 10 (2) F elt Fae Area ALEAT Fgrace Haga ATS aa ana AT aT aca” ae AAT @Gaal Va agate at fagaaeg Mar arafsa wel Fl AE ale a 73fe afafiaa aeenal at care” seen gH alfa HAT g | AT FETara & fs Prertfeet aver Peat var AeERAAT BT THA ATLAA)eq Ff adl fear wrawa & 1 ea ae aeiter ga fared IX areited & farofa arg fate soara ga ATAe Bt aT gla S aT feat TAIT Sra AMRMII Fo HAT BEAT atATA WEso [egto qiss] 23 The respondent asscssee is a registered firm and owns several col-lieries in West Bengal and Bihar. One of the collieries is known as E the South Samia Colliery. The South Samia colliery was under mili-tary occupation from 1942 and was released in 1955. During the period of military occupation the assessee incurred expenditure on account of minimum royalty payable in respect of the coJ:iery, the sur· face rent and salaries for the watch and ward employees. The ex-penditure was allowed in income-tax proceedings as a business ex-F penditure. After the colliery was released by the military, the assessee incurred n further expenditure amounting to Rs. 1,61, 7 42 on the col-liery with a view to resuming mining OJX'rations. The expenditure was incurred during the previous year beginning October 24, 1957 and ending November 11, 1958 relevant to the assessment year 1959-60. G In the assessment proceedings for that assessment year the assessee claimed a deduc'ion of the amount of Rs. 1,61,742 under s. 10(2) (xv) of the Indian Income Tax Act, but the deduction was disal[1]owed by the Income-tax Officer on the ground that the expenditure was capital in 'nature. On apJX'al, the Appe:late Assistant Commissioner affirmed that the expenditure was in the nature of capital expenditure. H The assessee proceeded in second appeal, but the Income Tax Appel-late Tribunal, without giving any reasons of its own, merely recorded itE agreement with the income-tax authorities. The assessee obtained a reference to the High Court at Calcutta for its opinion ob the follow· ing question : "Whether on the facts and circumstances of the case, the Income-tax appellate Tribunal was justified in holding that the expenditure claimed on the South Samla Colliery at Rs. 1,61,742 was capital in nature." Th~ High Court noted the following facts : The assessee carried on busihess in coal as the owner of various collieries. The South Samia Colliery, which was one of them, was occupied by the military from 1942 until it was derequisitioncd in 1955. During that period the assessee did not, because hei could not, work the colliery. He continued, however, carrying on hie business in coal and working other collieries during that period. While the South Samia Colliery remained under military occupation the assessee incurred expenditure on payment of surface rent and minimum royalty in respect of that colliery and also on account of salary for the watch and ward staff. The expenditure had been claimed and allowed as business expenditure of the assessee. After the colliery was handed over to the assessee upon derequisition, the assessee incurred, during the relevant period, an expendi'.ure of Rs. 1,61,742 in renovating the bnil\ling, reconditioning the machinery and clearing the land of debris accumulated over a numrer of years. The expenditure of Rs. 1,61,742 consisted of Rs. 66,937 spent on the staff and labour force by way of salaries, wages and other benefits and an amount of Rs. 94,805 spent on the purchase of various stores, machinery repairs, dhowrah repairs etc. This expenditure had to be . incurred by the assessee for the purpose of putting the machinery in working order and bringihg the colliery to a state where the mining operations could be resumed. The colliery had not started working and mining operations had not been resumed . during the relevant year. ‘at agree aval eft sit aadt| st tar sda Aare Pate aadaaaa, walt Bare grataA sat wad at get a varymera” } er H afing vel Prat or aeat Baile am saw tar ayBY Sa Ht F—A ae ara are 10 (2) (XV) ¥ ada-&fears ater fa HS art are ae 10 a (2)rT (V) at | aTeT faa 10 (2) (V) aeg Carey Faeaaa”are HERAT8 ae ea‘ara & aga star afer seta dlar 8 fie a aeemg TY “AERA” at E,saat Bete F fre ararea fagredt ox ar aret 10 (2) (XV) & weiterfra agt fear orat afar ea araea H aga a ee areqatar arfecfe tet aeeqat S aaa F faarawesa ar awa ga fagra 8 aaaT far arg tar aaa forrar arayarr geet a ae frat war st aera HTKAIT H LATTA TT WT A AT aH wT a egy He fear azar at ae aTeae got wate ar ad a, HIATT A aT at ATTA HA FH saatmele fae ot at goraa aet at ott arfer i are 10 (2) (V)al aretalg tet ara vale Tl ae ator Hed) at avar frvam atfara faafaa wr tagafaca gata fe aa aweaal & feetwend se faaras sasaret adt amet adit: eharz waarSTRATalfeu fe cay etaa Ht feat afafsan ae Bt cafe Held car ara earix F Ys faareat ans fraraa ATT % geet IZSMSC H casas oftaal HB seeq A at oral aed 1 araacverges aa faareta' i fat arsiaa arrae afafratfca fratTat at fe ag fare arfaal & aay F ary sar ale arza FH ag frat-Feet ater sama Brae saaH fre eqrqrearat aver ay fear wat &atagT AT Geet fafates sara grease arqea fagre ake estar?“ale aah fara fafaes gare qraat atqaa ARTA? | eT ATATATSTU‘ga faara ar agtara emt aaa ato WIgo alo! alt eaHAT ago‘fafaze aart ato ao gto afeadt anra’ F aad fear watz1afe se fram at seaaeg amare fears ara oe ata z al ea ‘1 (1932) 59 ago To 290, -2 (1955) 28 Atgo eo Ai<o 128. 8 (1970) 75 ago eo Ato 301, * (1958) 34 HIgo zto ATT 10, 15. 8 (1959) 37 algo lo Alto 4, 9, ata at afar aren 3 fear 10(2) (XV) % eta ar walafaega eae fear atar arfacs gard ua Fare yega aaa afaaifedt are feu ag ae ar ata “ary aera” F wT Fa fearHT THA at fax at ag are 10 (2) (XV) Hr Braet sara F fay eH-ZTEater ag seas BT and g fH at ay fated seat fafaesaay afasat are sats Taq) Fag afafaatfea fear ware fsmrad & faw afaa aarar ara Hara & fae arawrsy AURA FTAaval 2, 318 see Afaa for ora at eae St TE St AT eT | 7. Ha IT TE ssaze fe gar are 10 (2) -(XV) arr gat@1 ga ararg F Mer aga ate at avar zs fe sara cae fratfedt Farate BT safe cae e araalaaa frail ar achat HAT,AMT BATT TATA aay ate ala ae Saar Bt aH HWA Ara-dfaa ary a ast art atarer ara at afaarall BT are HVA H TATT-arg fae me Yaa TT Qa: AT TAT: HTVAIT H sata H favTAT TAT AT 1 Bare faare H as aaa A are faara vel at aaa s 1 8. freg afara arse sea og @ fH ear ga car al ost wala heag FETA THAT TT THAT zg aatfa afe Garg at aret 10 (2) (XV)Br Baa SAH ATA fragt F agqare ae fear star aferzaare fret era ar art Got safes Seay ar uaea oo FH wT F farBT aha gt far at saat fafavaa ate ater are fear areatfrat & setter ga oes al UH aT gat afeentr S Saat a MeaH ATATeal S ATATT AA | A VA aa se ofa faa Hea wt arqeaHatTel Si Tega aaa F aeal ge gra ania ate go fafarsa7to aIgo dto ea ante’? A gaara ara afaataa stat arseta Heat Tater Tatagat gs Tega aTAet F faatheady Br HrearzPAA SA A, ATIF MAAlal H SAAT TIT HAT AT WT aT |Ta RAAT GTA SeTTTA HT UH HH eT wah saa AAS THASq TAT BILAL AA TW AT A Bad aFaq UH UHH AIST ANATarfard at seared UH fear aar) ag ara at 7s et fe a faraats aaa % face aaifs va arate ar afaaen ara afan satsfag fear rat at, s& afc aét feat war ari aa gt ag arate arfa- ' 1923, 12 daa FAT 621, 625, 2 (1955) 27 HTRo Ho AIXo 34, onyi,jf|} |+fPa The High Court observed that the assessee was carrying on its business throughout and the circumstance that one of the collieries was not being worked did not affect the carrying on of that business. The business of the assessee, the High Court said, had to be considered as a whole and not on the basis of its different sources of snpr~Y or uuits of production. The High Court held that on the facts admitted and fon:nd it could not be said that any fresh asset had been acquired by the assessee by spending Rs. 1,61,742. The expenditure, it observed, was incurred by the assessee for the purpose of carrying on an exist-ing concern and not for acquiring any concern not in existence. Ac- cordi'ngly, it held that the expenditure was in the n&ture of revenue ex-penditure and, therefore, answered the question in favour of the assessee. In this appeal the first con:ention raised by the Revenue is that the High Court had no jurisdiction to re-appraise the facts and there-B fore its finding on th~ nature of the expenditure is vitiated. The con-tention is without substance. The facts on which the High Court has relied are admitted between the parties or are facts found by the in-come-tax authorities. We have no hesitation in rejecting the first contention. c The second contention is that the claim of the assessee must be considered with reference to s.10(2) (v) and not s.10(2)(xv) of tho Act. It is urged that if s.10(2) (v) is the relevant clause, being the specific provision in respect of expenditure on current repairs to build-ings nnd machinery, there is no justification for relying on s.10(2)(xv). S. 10(2) (xv) is a residuary clause, and deals with expenditure not be-D ing an allowance of the 'nature described in any of the preceding clauses of s.10 (2). The submission is that where repairs are effected to buildings and machinery a deduction under s.10(2) is permissible only in respect of curo~nt repairs, and repairs which are not "curre·nt repairs" are not intended to be the subject of relief. The Act, it is conte'nded, limits the repairs to "current" repairs. Th·~ repairs made by the assessee, it is said, cannot be described as "current repairs". Now, this contention rests on the principle; that if a special rrovision covers the case, resort cannot be had to a general provision. It seems to us that if the renovation of the building. the reconditioni'ng of machi-nery and the removal of debris cannot be described as "current re-F pairs"-and we assume that to be so--the case would be entitled to consideration under s.10(2)(xv). Section 10(2) (v) deals with cur-rent repairs only. The subject matter of s.10(2) (v) is "current repairs" a'nd it appears· difficult to agree that repairs which are not "current repairs" should not be considered for deduction on general princiQles or under s.10(2) (xv). There must be very strong evidence G that in the case of such repairs, the Legislature intended a departure from the principle that an expenditure, laid out or expended wholly and exclusively for the purposes of the business, a'nd which expendi-ture is not capital in nature, shoud not be allowed in computing the income from business. There is nothing in the language of s.10(2) (v) which declares or necessarily implies that repairs, other than, H current repairs, will not qualify for the benefit of that principle. We must remember that o'n accepted commercial practice and trading principles an item of business expenditure must be deducted in order |+fPa TEN Afar wear ag a at faaifeat tata F Teast fart & awa® goa fae. sa areata a ge wear aaa at at Ge aaa s feymS S TS TTR ore Gera ATE at Fant wr adeno featTOT aT | wae are aaa H arg TE A ate afaa aaa gia a gearTar ar) data F Alaa ara BY sa feafa F Arar war at TT saa Ffan snazan at 1 até ae anfea afeata Fatal are TE AY, HIATT FTpaarat auat sara faaisitaar-farg & fa ag ara afsa aearg sel wT Par3 Us TAT fear ar vara, ag Ba-TarT se faxJ Ta Har ars Ae Heals g fH faareeita ae F AWA He Gatanifeaarian vateq if tre aat an dt ae afaan fa wey alae at wats ara HT & CH chert fart A ow BTTATT FT afer Feqaaa agar sit ga aa & afma dare fe ga safes F aterfaatfedt arr saat art F arara F sama eq Bl sah ATTfaatent Haga aeldtHwa F aye fear TAT aT) Tega ara &faarudta 1,61,742 Boa BT era are HATA BY TAT A ANT FASTfaaifea cag ft ary ga ora ay vata ese wr H Uae TI Tagg|Oyaoa ast eqrarag FI at agafalaatfca wear dle 3 fa & eae qsit vata aT 9, afta aa ated aifes at arat & | €Ilo- atte aiheat BY Ty