TMI Blog1995 (9) TMI 122X X X X Extracts X X X X X X X X Extracts X X X X ..... -7-1986 by which the Investment Deposit Account Scheme was introduced. However, the Assessing Officer applying section 32AB(4) rejected the contention of the assessee holding that there is a clear prohibition for allowing any allowance under section 32AB if the amount is utilised for the purpose of road transport vehicles. Against the said order the assessee moved the Commissioner (Appeals who by his order confirmed the order passed by the Assessing Officer. 3. On behalf of the assessee it was submitted that the authorities below did not consider the Investment Deposit Account Scheme, which was notified by the Central Government and according to the scheme any repayment of the principal amount of the term loan contracted after 31st March, 1986 and taken for a period of three years or more from a financial corporation, etc., will be eligible for the allowance as provided in section 32AB. The learned counsel for the assessee has drawn our attention particularly to the provisions of the said scheme. According to her in the present case those criteria were fulfilled because the amount was utilised for repayment of the principal amount of the term loan which was contracted after 31st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance with, and for the purposes specified in, a Scheme (hereinafter in this section referred to as the Scheme) to be framed by the Central Government, or...." Sub-section (4) of that section is reproduced below :--- "(4) No deduction under sub-section (1) shall be allowed in respect of any amount utilised for the purchase of---- (a) any machinery or plant to be installed in any office premises or residential accommodation, including any accommodation in the nature of a guest house ; (b) any office appliances (not being computers) ; (c) any road transport vehicles ; (d) ...................... (e) ........................ "From a bare perusal of the provisions of the said Act it is clear that two conditions have been prescribed for the purpose of getting deduction under the said section, which are : (a) if the assessee has deposited any amount out of the income under the head ' Profits and gains of business or profession ' in an account referred to as deposit account maintained by him with the Development Bank or (b) utilised any amount during the previous year for the purchase of any new ship, new aircraft, new machinery or plant without depositing any amount in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he depositor carried on business or profession ; (iii) repayment of the principal amount of term loan contracted after the 31st March, 1986, and taken for a period of three years or more from a financial corporation which is engaged in providing long-term finance for industrial development in India or from a scheduled bank or from any such other institution as the Central Government may, by notification in the Official Gazette, specify in this behalf." From a perusal of the aforesaid clause it will appear that the utilisation of the amount for the purpose of section 32AB has been prescribed by clause 9(1)(a) according to which the amount will be utilised by depositing in a deposit account under clause (a) of sub-section (1) of section 32AB of the Income-tax Act or under sub-clause (b) of clause 9(1) of the Scheme according to which without depositing the same if any amount out of such income is utilised for the following purposes, viz., purchase of new ship, new aircraft, new machinery or new plant for the purpose of business or profession carried on by the assessee ; for the purchase of new computers ; and thirdly if such amount is utilised for repayment of the principal amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oodyear India Ltd. v. State of Haryana [1991] 188 ITR 402, the Supreme Court held that a rule of reasonable construction should be followed and literal construction may be avoided if that defeats the manifest object and purport of the Act. Further the Supreme Court in Reserve Bank of India v. Peerless General Finance Investment Co. Ltd. [1987] 61 Comp. Cas. 663, 692 (SC); [1987] 1 SCC 424, held as follows : " Interpretation must depend on the text and the context. They are the basis of interpretation. One may well say if the text is the texture, context is what gives the colour. Neither can be ignored. Both are important. That interpretation is best which makes the textual interpretation match the contextual. A statute is best interpreted when we know why it was enacted. With this knowledge, the stature must be read, first as a whole and then section by section, clause by clause, phrase by phrase and word by word. If a statute is looked at in the context of its enactment, with the glasses of the statute maker provided by such context, its Scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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