TMI Blog1997 (8) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... hich continued to derive income from contract work with Bhilai Steel Plant. The return filed on October 31, 1990, declaring an income of Rs. 3,59,800 was revised on March 27, 1991, declaring the same income of Rs. 3,59,800. The reason for filing the revised return was claimed to include the filing of TDS certificates which were left to be included in the original return. During the course of assessment proceedings, the Assessing Officer noticed that the assessee has claimed depreciation in respect of new trucks bearing Nos. NP 24A-2154 and MR 24A 2144. An examination of the accounts and other documents revealed that the assessee purchased propolated and structurals from Sun Flat Iron and Steel Co., Raipur, vide their Bill No. 1263 dated Mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted that though the Tribunal has relied on two decisions, one of the Allahabad High Court in the case of Niranjan Lal Ram Chandra v. CIT [1963] 49 ITR 177 and the other of the Madras High Court in the case of CIT v. Vayithri Plantations Ltd. [1981] 128 ITR 675, but there is a direct decision of this court in the case of CIT v. Jiwaji Rao Sugar Co. Ltd. [1969] 71 ITR 319 wherein a view has been taken by this court that if any machinery has not actually been put to use, then the depreciation will not be available. It may be relevant to mention here that the basic decision of the Supreme Court is in the case of Liquidators of Pursa Ltd. v. CIT [1954] 25 ITR 265. This question came up for consideration before the Allahabad High Court, Madras ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Thus, their Lordships have taken the view that machinery and plant should be actually put to use in the course of business activity for profits and gains in any accounting year, or at least for a part of the accounting year. This has been interpreted by the Allahabad High Court in the case of Niranjan Lal Ram Chandra [1963] 49 ITR 177, that the Supreme Court has left the question as to what is meant by the word "used". Incidentally, it may be relevant to mention here that section 10(2) of the Indian Income-tax Act, 1922, is almost in pari materia to section 32 of the Income-tax Act, 1961. Their Lordships of the Allahabad High Court took the view that the machinery in that case was not used at all during the accounting year and, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the statutory expression cannot vary in its meaning and content with the cases belonging to the pooling category and with others. The expression would have to be construed in a uniform sense so as to be applicable to all cases. Their Lordships considered the decision given by this court in the case of CIT v. Jiwaji Rao Sugar Co. Ltd. [1969] 71 ITR 319. This court in the case of CIT v. Jiwaji Rao Sugar Co. Ltd. [1969] 71 ITR 319 considered the Supreme Court case and observed as under : "In our opinion, the basic concept underlying this allowance is that depreciation should result as a consequence of the machinery being actually used or employed in the earning of income. That being so, it is not material whether or not the machinery is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd and the High Courts of Madhya Pradesh and Gujarat on the other, on the same basic case of Liquidators of Pursa Ltd. [1954] 25 ITR 265 (SC). Since this court has taken one view in the matter and that view has remained in force since 1966 and appears to be more in consonance with the scheme of the Act, therefore, we are of the opinion that the view taken by this court should be upheld and the finding of the Tribunal is not correct. We hold that since both the trucks in question were not used in the accounting year or part thereof, therefore, no depreciation allowance would be applicable to the assessee in the present case. Hence, the question is answered in favour of the Revenue and against the assessee. - - TaxTMI - TMITax - ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
