TMI Blog1995 (12) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment of the court was delivered by DR. B. P. SARAF J. --- By this reference made at the instance of the Revenue, the Income-tax Appellate Tribunal, Bombay Bench " A ", Bombay, has referred the following three questions of law to this court for opinion : " 1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee was entitled to a deduc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income-tax Act and that the provisions do not bar the allowance or depreciation on such assets so long as they continue to be used for scientific research ? " So far as questions Nos. 1 and 3 are concerned, counsel for the parties are agreed that both these questions are covered by the decision of the Supreme Court in favour of the Revenue and the same may be answered accordingly. Question No. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstructed thereon and allowed depreciation thereon. The Revenue challenges this finding of the Tribunal. Dr. Balasubramaniam, learned counsel for the Revenue, submits that the Tribunal committed a manifest error of law in allowing depreciation on the premium paid for the leasehold land. According to counsel, depreciation is allowable under section 32 of the Act only in respect of buildings and n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This question, in our opinion, is no more res integra in view of the decision of the Supreme Court in CIT v. Alps Theatre [1967] 65 ITR 377. The controversy before the Supreme Court in the above case was whether the word " building " occurring in section 10(2)(vi) of the Indian Income-tax Act, 1922 (corresponding to section 32 of the present Act), includes land. The Supreme Court categorically s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pinion that the Tribunal was not right in holding that the premium paid on the leasehold land was includible in the cost of the building constructed thereon for allowance of depreciation to the assessee under section 32 of the Act. Question No. 2 is accordingly answered in the negative and in favour of the Revenue. In the result, all the three questions referred to us by the Tribunal in this cas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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