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2013 (10) TMI 653 - PUNJAB AND HARYANA HIGH COURTEligibility for Higher Depreciation - Whether the machinery purchased under the Textiles Upgradation Fund Scheme (TUFS) and used for embroidery on unembroidered cloth used in textile industry are eligible for higher depreciation of 50% – Held that:- There is no stipulation by the Government of India or in law that the machinery purchased under TUFS is necessarily to be deployed in "manufacture" or "production", as has been claimed by the revenue - Rather, existence of the words "used in weaving, processing and garment sector of textile industry" appearing immediately after the words "machinery and plant" in Appendix-I of the Rules is not without significance - Even Section 32 of the 1961 Act, to claim depreciation, nowhere restricts user inter-alia of the machinery in 'manufacture' or 'production' - Similarly, conditions of TUFS also do not hedge user of the machinery to activities of manufacture or production only - use of words "processing" and "garment sector" are vibrant enough to include in their fold user of the machinery for any activity in textile industry so as to be eligible to claim higher depreciation. The words depict that the entire process starting from the weaving stage culminating upto the stage of manufacturing of garments is covered in these words. Embroidery is a sort of process on the clothes so as to turn those clothes into different textile products. In short embroidery is one of several processes which are carried out on cloth to make such cloth different products – Relying upon CIT v. Sovrin Knit Works [1992 (11) TMI 84 - PUNJAB AND HARYANA High Court] - business of bleaching, dyeing, finishing and embroidery of grey cloth which is not manufactured by the assessee itself but is purchased by it constitutes business of manufacture of producing textiles – Decided against Revenue.
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