TMI Blog1994 (11) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... L. VISWANATHA IYER J. --- The Income-tax Appellate Tribunal, Cochin Bench, has referred the following question of law for the opinion of this court under section 256(1) of the Income-tax Act, 1961 : "Whether, on the facts and in the circumstances of the case, the assessee is entitled to investment allowance under section 32A of the Income-tax Act, 1961 ? " This reference was made in relation to three years 1981-82, 1982-83 and 1983-84 in respect of which the Revenue sought reference of three different questions in its application for reference, namely:- "1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law and fact in finding that the assessee is entitled to investment allowance under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal confirmed the allowance under section 32A(2)(b)(iii) of the Act. Section 32A allows deduction of what is termed investment allowance, inter alia, in respect of machinery or plant specified in sub-section (2) which is owned by the assessee and is wholly used for the purposes of a business carried on by him. The allowance thus granted is in respect of the machinery or plant specified in sub-section (2). As per sub-clause (b)(iii) of sub-section (2), the machinery or plant in respect of which the investment allowance is granted is such machinery or plant used by an industrial undertaking for the purposes of business of construction, manufacture or production of any article or thing, not being an article or thing specified in the li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the words "articles or things". There is an elaborate discussion on the question generally and not merely with reference to dams and irrigation canals, and it was ultimately held as mentioned by us earlier, that the section does not comprehend the various items mentioned therein, like dams, bridges, buildings, roads, canals and other similar constructions. It must be noted that in the course of discussion, the Supreme Court has mentioned that articles or things mentioned in the provision refer only to movable objects and that they cannot have any application to immovable items of the nature mentioned by us earlier, despite the use of the word "construction" therein. It has, therefore, to be held that section 32A(2)(b)(iii) has no appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acture or production of any article or thing is not satisfied and, therefore, the question whether the assessee is an industrial undertaking is immaterial and irrelevant. The fact that the latter condition is not satisfied is by itself sufficient to disentitle the assessee to the benefit of investment allowance under sub-section (1) of section 32A. Since the answer to the question referred by the Tribunal is against the assessee, it has become unnecessary to deal with the three applications under section 256(2) on the merits. We are not, therefore, expressing any opinion on the merits of those applications. The question referred in Income-tax References Nos. 30 to 32 of 1991 is, therefore, answered against the assessee and in favour of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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