TMI Blog2003 (12) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... – Held yes - - - - - Dated:- 22-12-2003 - Judge(s) : D. BISWAS., S. K. KAR. JUDGMENT The judgment of the court was delivered by D. BISWAS I.-Income-tax Appeal No. 29 of 2001 and Income-tax Appeal No. 31 of 2001 under section 260A of the Income-tax Act, 1961, were admitted for hearing on the following common questions of law: "1. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in not upholding the order of the first appellate authority which had confirmed the Assessing Officer's order disallowing the claim of investment allowance under section 32A of the Income-tax Act, 1961, as the nursing home/hospital of the assessee is not an industrial undertaking? 2. Whether, on the facts and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,00,000 has been added as the assessee's income for the assessment year 1989-90 and Rs. 65,000 for the assessment year 1990-91. The Commissioner of Income-tax (Appeals) rejected the claims preferred by the assessee against the aforesaid orders under section 143(3) of the Income tax Act, affirming the decision of the Assessing Officer. The assessee preferred Appeals Nos. 45 and 56/Gauhati of 1994 against the aforesaid orders. The learned Tribunal disposed of both the appeals by a common order dated June 20, 2001. The learned Tribunal allowed both the appeals affirming the assessee's claim. We have heard Mr. U. Bhuyan, learned counsel for the appellant, and also Mr. R.P. Agarwalla, learned senior counsel for the respondent-assessee. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Hospital Ltd. [2001] 251 ITR 683. In that case the assessee claimed deduction under sections 80HH and 80-I in respect of the entire hospital. The court held that in the absence of a clear finding to show that a new article or thing is manufactured or produced out of some raw materials, it is difficult to hold that the assessee, Down Town Hospital, is an industrial undertaking. This decision in our opinion is not applicable in the instant case. The assessee claimed investment allowance as per the provisions of Section 32A(2) for the ultrasound medical diagnostic electrical equipment, air-conditioner and servo voltage stabilizer and not for the entire establishment. The decision of the Rajasthan High Court in CIT v. Trinity Hospital [99 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the exercise undertaken by the assessee-firm in the process of diagnosis of the disease through the ultrasound diagnostic equipments is a 'thing' produced within the meaning of section 32A(2)(ii) of the Act. The ratio in Live Tone v. State of Tripura [2001] 122 STC 115 (Gauhati) and in Vishwa Vimohan Jha v. State of Meghalaya [2002] 1 GLT 276 also lend support to the above view. The preponderance of judicial opinion and desirability of uniformity impel us to decide that the assessee-firm is entitled to investment allowance under section 32A(2) (b)(ii)." In Mar Gregorious Memorial Muthoot Medical Centre v. CIT [2003] 261 ITR 443 (Ker), the question for consideration before the High Court was whether the Tribunal was justified in denying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent, air-conditioner and voltage stabilizer on the ground that the assessee did not manufacture or produce any article or thing as envisaged in section 32A(2)(b)(ii) of the Act (sic). The Calcutta High Court in CIT v. Air Survey Co. of India P. Ltd. [1998] 232 ITR 707 in the case of the assessee, an air survey company, engaged in the business of survey, mapping, aerial photography and aero-magnetic photography claimed investment allowance under section 32A of the Act in respect of aircraft radio purchased, after relying upon the decisions in CIT v. Trinity Hospital [1997] 225 ITR 178 (Raj) and CIT v. Upasana Hospital [1997] 225 ITR 845 (Ker) answered the question in favour of the assessee." It is clear from the aforesaid judgments that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... numbers before the Assessing Officer. According to the learned Tribunal, the assessee also submitted before the Assessing Officer the confirmations from the creditors where full addresses, income-tax file numbers, etc., were given. Even some of the payments were made by cheques. Relying upon the decision in CIT v. Stellar Investment Ltd. [1991] 192 ITR 287 (Delhi), the Tribunal came to the conclusion that no addition under section 68 of the Act is permissible where the shareholders are identified and it is established that they had invested the monies in the purchase of the share. The aforesaid decision in Stellar Investment Ltd. [1991] 192 ITR 287 (Delhi) was also affirmed by the hon'ble Supreme Court in the case of CIT v. Stellar Investm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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