TMI Blog2006 (3) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Rs. 9,14,840. The return was processed under section 143(1) on 1-12-1999. The assessment was completed under section 143(3) on 28-3-2001 accepting the income returned. The Commissioner of Income-tax III, Hyderabad, issued a notice to the assessee for invoking his jurisdiction under section 263 on the issue as to whether the Assessing Officer was right in allowing depreciation at the rate of 100 per cent on temporary construction amounting to Rs. 14,02,810 instead of 10 per cent as the structures in question have all the characteristics of a permanent building. After hearing the assessee, the CIT held that on going through the details and measurements of the temporary sheds submitted by the assessee, it was found that the structure had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after. He emphasized that the land neither belongs to the assessee nor has been given on lease or such other arrangement by the contractee. He vehemently contended that the project offices at work sites are only temporary constructions and it is wrong on the part of the CIT to treat these constructions as permanent structures. He referred to Appendix I to the Income-tax Rules, 1962, which is a table of rates at which depreciation is admissible, at Category I Buildings, clause (4), and submitted that the term "purely temporary erections such as wooden structures" is a separate category in the Block of Assets and the CIT was wrong in holding that only wooden structures would be eligible for 100 per cent depreciation whereas the description gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stion were permanent structures and not purely temporary structures as specified in the depreciation table. He filed a paper book running into 7 pages and submitted that at pages 1 to 4 of the paper book is a copy of the valuation report filed by the assessee itself before the revenue authorities. He drew the attention of the Bench to this valuation report and submitted that a plain reading of the same shows that brick masonry in cement mortar with the ratio 1:6 had been used, 5 mm. thick glazed tile flooring in toilets was used, MS grills made out of 12 mm. square bars were used for all windows, reinforced cement concrete of mix 1:2:4 was used etc. These, he submitted, show that the structure in question was a permanent structure as held b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wned by the contractor nor is it held by the contractor as leasehold. In this view of the matter, the structures put up on such land, of whatever nature, are purely temporary structures. The assessee might have used material which gives longer life to the structures in question, but the fact remains that the assessee is neither the owner of the land nor has it any claim over the structures after completion/termination of the contract. In fact, when such structures are put up on land not belonging to the person, the expenditure is of revenue nature in view of the judgment of the Hon ble Supreme Court in the case of CIT v. Madras Auto Service (P.) Ltd. [1998] 233 ITR 468 . The same view has been taken by this Bench of the Tribunal in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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