COMMISSIONER OF INCOME TAX - I vs. CB RICHARD ELLIS SOUTH AISA P. LTD.

IN THE HIGH COURT OF DELHI AT NEW DELHI . ITA 320/2013 . COMMISSIONER OF INCOME TAX - I . ..... Appellant . Through Mr. Sanjeev Rajpal, Sr. Standing Counsel. . . . Versus . CB RICHARD ELLIS SOUTH AISA P. LTD. . ..... Respondent . Through Nemo. . CORAM: . HON'BLE MR. JUSTICE SANJIV KHANNA . HON'BLE MR. JUSTICE SANJEEV SACHDEVA . O R D E R . 17.07.2013 . . . This appeal filed by the Revenue in the case of CB Richard Ellis South Asia Private Limited relates to Assessment Year 2003-04. . 2. The respondent-assessee had taken a premises on rent for a period of three years and had incurred expenditure of Rs.54,26,906/- on maintenance and repairs. This expenditure was disallowed and treated by the Assessing Officer as capital expenditure. Commissioner of Income Tax (Appeals) held that expenditure to the tune of Rs.10,43,285/- was capital in nature but the balance expenses of Rs.43,83,621/- were of revenue character as they related to converting a big hall into a more suitable office space by dismantling, disposal, plumbing and toilet work, brick work, plaster, water proofing, gypsum partition, door frame, door shutter, partition, storage etc. . 3. The said view has been affirmed by the tribunal with the direction that in respect of Rs.10,43,285/-, nature of expenses will be re-examined by the Assessing Officer after opportunity to the respondent. The tribunal in the impugned order has specifically noted that the lease agreement permitted the respondent-assessee to make temporary alterations in the leased premises and no new asset of enduring nature had come into . existence. The assessee had incurred the expenditure on temporary erections and to make the premises habitable for their use during the period of the lease. Expenditure incurred on renovation in the rented premises was revenue in nature and towards current repairs. . 3. The said findings are as per and in consonance with two decisions of this Court in Commissioner of Income Tax versus Hi Line Pens Private Limited (2008) 306 ITR 182 (Delhi) and unreported decision in CIT versus Amway India Enterprises Private Limited (ITA No. 346/2012 decided on 18th May, 2012). Keeping in view the findings of fact recorded by the tribunal and the nature and character of the expenditure incurred and the two judgments of the Delhi High Court quoted above, no substantial question of law arises for consideration and the appeal is dismissed in limine. . . . . . SANJIV KHANNA, J. . . . . . JULY 17, 2013 SANJEEV SACHDEVA, J. . VKR/NA . . . $ 43. .