TMI Blog2004 (7) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... and as against the Revenue. - Tribunal has not considered, based on evidence, what is the area available in the assessee's nursing home, which should be construed as "plant" and what is the remaining area, which would come within the meaning of an ordinary building, not attracting the definition of plant. - In the absence of factual aspect as indicated above, we feel it is not possible for us to answer the first question under reference and therefore, to the above extent we restore the matter back to the Tribunal - - - - - Dated:- 16-7-2004 - Judge(s) : N. V. BALASUBRAMANIAN., M. THANIKACHALAM. JUDGMENT In pursuance of the directions by this court in T.C.P. No. 283 of 1997 dated March 9, 1999, the matter was referred under section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be construed as a "plant", since a nursing home building requires not only a special type of construction, but also, it requires continuous maintenance of the same, in order to protect the hygienic condition, as well as to prevent the entry of germs. It is the further contention of learned counsel for the assessee, that operation theatre, x-ray plant unit and other modern scientific equipment, which are necessary for running the nursing home would require a special type of protective building and in this view, the building should be treated as a "plant". Opposing the abovesaid contentions, learned counsel for the Department would contend, that all the buildings available in a nursing home would not require any specific special constructio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a "plant", entitling it to depreciation, as contemplated under section 32 of the Income-tax Act, 1961. The apex court approving a ruling of the Allahabad High Court in S.K. Tulsi and Sons v. CIT [1991] 187 ITR 685, held as follows: "If it was found that the building or structure constituted an apparatus or a tool of the taxpayer by means of which business activities were carried on, it amounted to a 'plant'; but where the structure played no part in the carrying on of those activities but merely constituted a place wherein they were carried on, the building could not be regarded as a plant." Thus, in order to qualify a nursing home building as a "plant", the above test prescribed by the apex court should be satisfied. In the case inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of Carr (H. M. Inspector of Taxes) v. Sayer 65 TC 15 (Ch D), it has been observed that a hotel building remains a building even when constructed to a luxury specification and similarly a hospital building for infectious diseases which might require a special layout and other features also remains a premises and is not plant." This would suggest that the hotel building or the nursing home, constructed with special layout or features, is not a plant. However, it seems, Dr. Venkata Rao's case [2000] 243 ITR 81 (SC) was brought to the notice of their Lordships and in fact, the previous ruling, where it is held that the nursing home could be treated as a plant, was not overruled, thereby showing at least a portion of the nursing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an apparatus, for carrying on business activity. In this view of the matter, unless on the facts, it is established that the nursing home is a tool or an apparatus, for carrying on business activity, for which allowance is claimed, it may not be possible to extend the benefits to the entire building and if at all, the benefit could be extended as ruled by apex court in Dr. B.Venkata Rao's case [2000] 243 ITR 81, to a portion of the building or the building as the case may be, which could be treated as a 'plan'." A Division Bench of the Kerala High Court in CIT v. Dr. Ganga R. Menon [2003] 259 ITR 661, considering the ratio laid down by the apex court in Anand Theatres' case [2000] 244 ITR 192 and Dr. B.Venkata Rao's case [2000] 243 ITR 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the machinery and spares, which are added during the relevant previous years. In this case, the assessee had installed equipment in the operation theatre and other area of the nursing home, as an integral part of a portion of that building and in this view, as ruled by the apex court, they are entitled to extra shift allowance and therefore, the second question referred to us is answered in favour of the assessee and as against the Revenue. The Tribunal has not considered, based on evidence, what is the area available in the assessee's nursing home, which should be construed as "plant" and what is the remaining area, which would come within the meaning of an ordinary building, not attracting the definition of plant. This factual aspect c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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