Interior decoration, electrification costs, furniture costs, wallpaper, tempered glass, etc. are purely temporary structures: the ITAT allows 100% amortization.


Income Tax Appeal Tribunal (ITAT) Delhi Bench ruled that interior decoration, electrification cost, furniture cost, wallpaper, tempered glass etc. are purely temporary structures; ITAT provides 100% damping

The call, M/s. India Safari and Tours Ltd. engages in inbound tour business and provides tour and travel services to foreigners coming to India. During review of the case, the Valuation Officer noticed that an addition of Rs.16,28,357/- in the table of fixed assets was filed with the revised report. Without satisfying the response, AO rejected the amount reducing Rs. 81,418/- as depreciation and added rupees. 15,46,939/- to the total income of the assessed person. The CIT (A) confirms the addition; therefore, the assessee filed an appeal with the ITA.

Counsel for the assessee argued that this is a purely temporary structure on which 100% depreciation should be allowed. The attorney further argued that superior courts have repeatedly held that these temporary structures can be claimed as tax expenditures.

The Tribunal observed that the expenses relate to interior fittings, electrification charges, furnishing charges, wallpaper, tempered glass, etc. These items are definitely revenue devices when used in rented premises. AO’s assumption that it is “probably” an addition to furniture and fixtures is conjecture and not viable in law.

The Coram of Mr. Shamim Yahya, Accounting Member, and Ms. Astha Chandra, Judicial Member relying on the decision of the Allahabad High Court in the case of Girdhari Dass & Sons v CIT held that “we rescind the orders of the authorities below on this matter and decide the matter in favor of the assessee”.

Mr. DC Garg, CA, and Ms. Anupama Singla appeared on behalf of the Appellant and Revenue respectively.

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Ms. India Safari and Tours Ltd.

Counsel for the Appellant: Shri DC Garg

Counsel for the Respondent: Ms. Anupama Singla



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