TMI Blog1993 (12) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... ads, constituted 'plant' within the meaning of section 43(3) of the Income-tax Act, 1961." ? The assessee is a limited company and is a manufacturer of grinding media balls and ingots. A claim for depreciation initially was made on the plant and machinery installed. The Income-tax Officer held that the building for the plant and machinery is not plant and, therefore, the depreciation and investment allowance was disallowed. In appeal before the Commissioner of Income-tax (Appeals), it was observed that the building in the present case could be covered within the meaning of the word "plant". The main stress before the Commissioner of Income-tax (Appeals) was that the factory structures which have been constructed for production of heavy st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... test is whether it is the means of 'carrying on the business' or the location for so doing ; (4) In order for a building or concrete structure to qualify for inclusion in the term 'plant', it must be established that it is impossible for the equipment to function without the particular type of structure ; and (5) The particular apparatus or item must be used for carrying on the assessee's business and must not be his stock-in-trade. The matter has to be considered in the context of the particular business of the assessee, e.g., books are a lawyer's plant but a bookseller's stock-in-trade." Under section 43(3), "plant" has been defined as under: "'Plant' includes ships, vehicles, books, scientific apparatus and surgical equipment use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business in which the business is carried on. Cold storage, silos, well are such of the items which have been interpreted to fall within the term "plant". Learned counsel for the assessee has placed reliance on the decision of the Madras High Court in the case of Addl. CIT v. Madras Cements Ltd. [1977] 110 ITR 281, wherein it was observed that the expression "plant" has to be construed in the context of the particular kind of trade or manufacture carried on by the assessee and if in the context it could be taken as "plant" as understood in the popular sense it would be eligible for the allowance of depreciation and development rebate. Reliance has also been placed on the decision of the Allahabad High Court in the case of CIT v. U. P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... support to the gigantic cranes. On the basis of this blue print, the Tribunal came to the conclusion that the structures were raised to make the plant operative which could not have functioned in its absence. It was further observed that it is not a mere structure for location of the plant but the structure which makes the plant operative and workable. There may be a structure which falls within the category of building and plant. Whether the structure is a building or a plant has to be examined on the basis of the functional test. The use of the structure makes the distinction between plant or building in which it could be categorised. In the present case, the revised return was submitted in the proceedings initiated on the basis of the d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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