SHYAMAL KUMAR SEN, J.

( 1 ) IN this reference under Section 256 (1) of the Income-tax Act, 1961, the following question has been referred to this court for determination :"whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the expenditure incurred by the assessee-company on re-routing of the water pipeline is a revenue expenditure and is deductible expenditure"

( 2 ) THE facts as appear from the statement of case, inter alia, are as follows : the assessee-company carries on the business of manufacture of zinc slabs with sulphuric-acid and cadmium as by-products. The assessee-company included a sum of Rs. 4,77,080 under the head "repairs and maintenance and others" being expenditure included for the water pipeline including cost of pipes, labour charges and electrical inspection charges. The Income-tax Officer disallowed the said expenditure as capital expenditure.

( 3 ) ON an appeal having been preferred before the Commissioner of Income-tax (Appeals), it was stated that, during the summer season, the flow of water in the river Periyar is restricted and the sea water enters the Periyar river causing more salinity in the water

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