TMI Blog2006 (12) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... . 433 and 434/Mds/2003, dated November 25, 2005. The Revenue is the appellant. The assessment years involved are 1998-99 and 1999-2000. The assessee, who is a medical practitioner, constructed a nursing home during the period February, 1996, to October, 1998. On a survey conducted by the Income-tax Department on November 3, 1998, it was found that the cost of construction as shown by the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the apex court in CIT v. Dr. B. Venkata Rao [2000] 243 ITR 81, held that the cost of construction of the nursing home is entitled for depreciation on the ground that it is a plant. Aggrieved by the said decision of the Tribunal, the Revenue has preferred the present appeal raising the following substantial question of law: "In the absence of any application of functional test being appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eported in CIT v. Dr. B. Venkata Rao [1993] 202 ITR 303 and dismissed the appeal filed by the Revenue by holding as follows: "It was clear from the order of the Tribunal as also the assessment order that the assessee's nursing home was equipped to enable the sterlisation of surgical instruments and bandages to be carried on. It was reasonable to assume in the circumstances, particularly having r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the carrying on of those activities but merely constitutes a place within which they are carried on, the building cannot be regarded as a plant." Admittedly, in the instant case, the Assessing Officer and the Commissioner as well as the Tribunal observed that the assessee, who is a medical practitioner, is running a nursing home. Hence, applying the ratio laid down by the apex court in CIT v. D ..... X X X X Extracts X X X X X X X X Extracts X X X X
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