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2022 (7) TMI 289 - HC - Income TaxDepreciation u/s 32 - bottles and crates appellant-assessee uses in the course of carrying out its business can be treated as plant within the meaning of Section 32(1)(i) - HELD THAT:- As regards the factual position, that is, use of glass bottles, return of bottles in the manner in which crates are used, the Revenue has accepted the facts of the present case and the factual position in the case of Jai Drinks (P.) Ltd. and Sri Krishna Bottlers Pvt. Ltd. are identical. Tribunal did not hold against the Appellant making a distinction in the facts on the factual situation but has not followed the decisions of Rajasthan High Court and Andhra Pradesh High Court as above relying on the decision of the Supreme Court in the case of Steel City Beverages Ltd. Therefore, the only question that will arise for consideration is whether the Supreme Court in the case of Steel City Beverages Ltd., has overruled the view taken in the case of Jai Drinks (P) Ltd. [1987 (9) TMI 8 - RAJASTHAN HIGH COURT] and Sri Krishna Bottlers Pvt. Ltd. [1988 (4) TMI 10 - ANDHRA PRADESH HIGH COURT] construing the provisions of Section 43 (3) of the Act. Supreme Court, in the case of Steel City Beverages Ltd. [1998 (11) TMI 125 - SUPREME COURT] considered the issue of whether the bottles and crates can be construed the definition of “Plant” and held bottles those could not be considered as stock in trade. However, the issue that arose before the Supreme Court under the Bihar Sales Tax Supplementary (Deferment of Tax) Rules 1990 Tribunal, before following the decision of the Supreme Court in Steel City Beverages Ltd., had not adverted to these observations of the Supreme Court at all and, therefore, clearly erred in applying this decision and not following the decisions of the High Courts of Rajasthan and Andhra Pradesh cited before it, which had construed the same provision which was under consideration. Respondent that bottles and crates could not be included in the definition of the “Plant” because they have no reference to the categories mentioned therein; therefore, cannot be accepted. As regards the contention of Respondent based on the Income Tax Rules and Depreciation Table is concerned, the Table is only states that certain categories, which are Machinery and Plants, will have particular rate and rest which fall under the Machinery and Plant will have different rate. Therefore, merely because the bottles and crates do not fall under the categories listed in Item 2 of the Schedule, it cannot be said that they need to be excluded from the definition of “Plant”, if they, otherwise fall within the definition of “Plant”. It has to be noted that, however, this question had arisen for the assessment year 1989-90 based on the situation therein, and therefore, the question is whether the Tribunal was right in holding against the Appellant for that particular assessment year. As noted in the decision of Sri Krishna Bottlers Pvt. Ltd [2004 (11) TMI 37 - ANDHRA PRADESH HIGH COURT] as to what would happen if plastic bottles were used or the manner of use is changed in future, those would be the facts of that case. - Decided in favour of assessee.
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