SHRI LAXMANBHAI PRABHUDAS PATEL,AHMEDABAD vs. THE DY. CIT., CENTRAL CIRCLE-1(2), AHMEDABAD

We now come to the above sole substantive issue disallowance of renovation expenses of Rs.4,23,410/-. The assessee had sold his office at Maruti Tower in the relevant previous year. He thereafter claimed office renovation expenditure deduction . He inter alia pleaded before the Assessing Officer to have purchased the property in question on 01.04.1992 followed by sale thereof on 04.02.2010 having holding period of more than 17 years. There is no dispute that the assessee himself submitted at the first instance to have not maintained the renovation details in old records. The Assessing Officer declined above claim for this precise reason only quoting lack of documentary evidence. The CIT(A) affirms Assessing Officer’s action in the order under challenge.

We have given our thoughtful consideration to rival submissions strongly reiterating their respective stands. There is no dispute that the assessee had purchased his office / impugned capital asset for the year 1992 and sold the same for Rs.13lacs in the relevant previous year. Both the lower authorities denied its office renovation expenditure clamed for lack of documentary evidence. We find no reason to disagree with both the lower authorities’ action in question in principle as it was very incumbent for the assessee to have filed at least some details if not all pertaining to the issue office renovation expenditure. We however are further of the view that this reason cannot form the sole basis for denying the impugned claim altogether as it is not something very uncommon that a capital asset held for almost two decades requires at least some renovation expenditure in the nature of normal wear and tear. We therefore feel appropriate in larger interest of justice that a lump sum office renovation expenditure of Rs.1lac only would be just and proper in order to set the instant issue at rest. The Assessing Officer is accordingly directed to frame consequential computation allowing assessee’s impugned claim to the extent of Rs.1lac only. It is made clear that our instant discussion would not

This assessee’s appeal is allowed in above terms.