Commissioner of Income Tax vs P. Veriah

T.L. Viswanatha Iyer, J.—We do not find any referable question of law arising out of the order of the Tribunal, annexure "C". The assessee, an individual, was a partner of a business which was running a cinema theatre. The firm was dissolved in 1979. The cinema business was taken over by the assessee. The Tribunal found, as a fact, that there was no discontinuance of the business. The assessee''s claim for deduction of expenses spent on decorative items, furniture, electrical works and sanitary works in the course of improving the theatre was allowed by the Tribunal as revenue expenditure. The Tribunal could not find any question of law to be referred and hence this application u/s 256(2) of the Income Tax Act, 1961.

So far as decorative items are concerned, it includes plaster of paris work, decoration of walls, ceilings, verandas, etc. The Tribunal noted that these are not items of a permanent nature, but liable to change as tastes and fashions change. The Tribunal therefore allowed the expenses as revenue expenditure. The finding on the nature of the work is essentially a question of fact on which no question of law arises.

Regarding furniture, the finding of the Tribunal was that it was a case of arrangement, and remodelling by which the seating capacity of the theatre got reduced. No enduring advantage was derived by the assessee. The same was the position regarding the electrical and sanitary fittings. Since no enduring advantage was derived by the assessee, the expenses were in the nature of revenue expenses and hence deductible. The findings on which these conclusions are arrived at are findings of fact on which no referable question of law arises.

The other item on which reference was sought from the Tribunal was regarding investment allowance and extra-shift allowance on the generator. The Tribunal relied on Circular No. 1454 of the Central Board of Revenue and allowed the amount as an admissible deduction. We perused the circular in which the Board has directed that generators are not covered by the entry electrical machinery in the Income Tax Rules, 1962, and, therefore, entitled to extra-shift allowance. The circular has been rightly applied to the assessee''s case.

We do not, therefore, find any question of law arising out of the order of the Tribunal, referable to this court. This petition u/s 256(2) is, therefore, dismissed.