TMI Blog1992 (4) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... ssistant Commissioner dismissed the appeal. On further appeal, the Tribunal, following its earlier order for the assessment year 1962-63 in the case of the assessee, allowed the aforesaid two claims with regard to depreciation on the roads as well as development rebate on the tractors, trailers, etc. The Revenue filed an application under section 256(1). The said application was dismissed by the Tribunal. The Revenue then filed an application under section 256(2)in the High Court. The High Court accepted the application with regard to two questions only and rejected it so far as the question regarding depreciation on roads was concerned. The Revenue filed a special leave petition against the order of the High Court. This court, by order dated December 5, 1980, granted special leave confined to question No. 1 only which reads as under : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in law in holding that depreciation is admissible on the written down value of the cost of construction of roads in the factory premises on the footing that they constitute building?" Civil Appeal No. 1194 of 1977. CIT v. ELECTRO METALLURGICAL W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to state the case and refer the question of law was made in respect of question No. 1 only." The High Court, by its order dated June 17, 1976, issued a notice as regards question No. 1 only and dismissed the application so far as question No. 2 was concerned. The Revenue, in the above circumstances, filed a special leave petition against the order dated June 17, 1976, and leave was granted. Civil Appeal No. 2978 of 1989. CIT v. HINDUSTAN AERONAUTICS LTD. The Income-tax Officer disallowed the claim for depreciation on roads and drains for the assessment year 1977-78. The Commissioner of Incometax (Appeals) allowed the depreciation following the decision of the Bombay High Court in CIT v. Colour-Chem Ltd. [1977] 106 ITR 323 and the Madras High Court decision in CIT v. Lucas-TVS Ltd. (No. 2) [1977] 110 ITR 346. The Tribunal dismissed the appeal filed by the Revenue. The Tribunal rejected the reference application filed under section 256(1). On a reference application filed by the Revenue under section 256(2), the High Court directed the Tribunal to state the case and refer the question of law for its opinion. The High Court followed its earlier decision in CIT v. Bangalor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he High Court held that it was covered as a result of an amendment to the Act which has, been noted in R. C. No. 80 of 1978, dated April 18, 1983. The answer was, therefore, recorded against the assessee and in favour of the Revenue. In the special leave petition, it is stated that both the questions referred were answered in favour of the assessee which is not correct. Since this bunch of appeals raises common questions of law for decision, they are disposed of by a common judgment. The facts in Civil Appeal No. 2916 of 1980 are sufficient for a decision. Hence, they are extracted. For the assessment year 1963-64, relevant to the previous year ending on March 31, 1963, the respondent-assessee, a company incorporated under the Companies Act, claimed depreciation on the roads constructed by it as forming part of the cost of the factory building. The Income-tax Officer and, on an appeal, the Appellate Assistant Commissioner rejected the claim. On further appeal, following the decision of the Bombay High Court for the previous year, the Tribunal allowed the appeal and held that the assessee is entitled to depreciation. Then the Revenue sought a reference on the question : "Whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... controversy, the rules were amended and they came into force with effect from April 2, 1983. The subordinate Legislature gave effect to the interpretation given by various High Courts to the word "building" which included roads as well. Sri Manchanda further contended that a taxing statute should be strictly construed : common sense approach, equity, logic, ethics and morality have no role to play. The words in the taxing statute should be given a literal interpretation. Nothing is to be read in, nothing is to be implied ; one can only look fairly at the language used and nothing more and nothing less. It is settled law that the expressions used in a taxing statute would ordinarily be understood in the sense in which it is harmonious with the, object of the statute to effectuate the legislative intention. In Raja Jagdambika Pratap Narain Singh v. CBDT [1975] 100 ITR 698, this court held that "equity and income-tax have been described as strangers". The Act, in the very nature of things, cannot be absolutely cast upon logic. It is to be read and understood according to its language. If a plain reading of the language compels the court to adopt an approach different from that dicta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an Income-tax Act, 1922, held that section 10(2) provides that such profits or gains shall be computed after making certain allowances. The object of giving these allowances is to determine the assessable income. There, the question was whether the land on which the theatre was constructed is a building within the meaning of section 10(2) of the Indian Income-tax Act, 1922. This court held that land is not a building and, therefore, depreciation allowance for land separately is not admissible. The ratio therein has no application but the principle laid down could be considered in the light of the purpose of the Act. In CIT v. Taj Mahal Hotel [1971] 82 ITR 44, this court, adopting a purposive approach, held that sanitary and pipeline fittings fell within the definition of plant. The 1922 Act intended to give a wide meaning to the word "plant". Rules are meant only to carry out the provisions of the Act and cannot take away what is conferred by the Act or whittle down its effect. In Municipal Corporation of Greater Bombay v. Indian Oil Corporation Ltd. [1990] 4 JT 533 (SC) ; AIR 1991 SC 686, oil tanks for storage of petrol were held to be buildings exigible to property tax. The que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g authority accepted this interpretation consistently laid down by various High Courts that building includes roads and also elongated bridges, culverts, wells and tubewells as building but prescribed fixed rates of depreciation setting at rest the variable rates claimed by the assessee. Rules validly made have the same force as the sections in the Act. The contention of the respondents that unless the Act itself is amended, the rules would not cut down the meaning of the word "building" is without substance. The inclusive definition of "building" to include roads, etc., enlarges the scope of section 32 and does not whittle down its effect. It is true that in CIT v. Coromandel Fertilisers Ltd. [1985] 156 ITR 283 (AP), the High Court of Andhra Pradesh interpreted that "roads" fell within the meaning of "plant" and granted depreciation at the rates admissible to plant. CIT v. Sandvik Asia Ltd. [1983] 144 ITR 585 (Bom) took the opposite view and held them to be building. In view of the consistent view of the other High Courts and which, in our view, is the correct one, the view of the High Court of Andhra Pradesh is not correct in law. It is true, as contended for the Revenue, that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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