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1965 (12) TMI 28 - SC - Income TaxWhether depreciation is allowable on the original cost of the various components of the plant and machinery and other assets of the company as acquired and used prior to July 1, 1953 ? Held that:- Assessee's argument that on a proper interpretation of section 10(5)(b) of the Act, the depreciation must be deemed to have been allowed to the assessee in the years in which the income of the assessee-company was exempted is not acceptable as the words "actually allowed in paragraph 2 of the Taxation Laws (Merged States) (Removal of Difficulties) Order, 1949, did not include any notional allowance and we must interpret the, words "actually allowed" occurring in section 10(5)(b) of the Act in the same manner. The Explanation inserted by the 1962 Order has no bearing on the facts of this case. The exemption granted by the Central Government is granted under paragraph 15 of the Merged States (Taxation Concessions) Order, 1949, which was itself issued under section 60A of the Act. The result is that the exemption was granted under the Act and not under any agreement. The case of the assessee must be determined with reference to section 10(5)(b) of the Act, unaffected by the amendment made by the 1962 Order. Appeal dismissed.
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