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TMI Blog2022 (9) TMI 1488X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of Assessment Year 2006-07. The appellant Revenue seeks to raise following substantial question of law, Whether in the facts and circumstances of the case, the learned ITAT has erred in law and on facts in allowing the depreciation on oil wells treating the same as Plant and Machinery? 3. The respondent assessee Company is engaged in exploration of crude oil from Dholka and Wavel oil fields. The crude is transported to Oil & Natural Gas Corporation central storage for its further process. 3.1 The company filed its income tax return on 02.01.2007 in respect of the order in consideration declaring loss of Rs.3,92,94,965/-. The case was selected for scrutiny and notice under Section 143(2) was issued by the Income Tax Officer. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judicial pronouncements in this regard as to a tube well constitute a plant or otherwise held as under vide para 65: "This also gives an impression that the gas oil wells are not plant. It is but a setting through which the assessee extracted oil and gases, and therefore a part of the building within the extended meaning of the term building given in the Appendix 1 to Income-tax Rules. The depreciation would be allowed thereon @ 10 per cent as building." In view of the clear finding of the jurisdictional ITAT, I uphold the Assessing Officer's action in treating oil wells as building and allowing depreciation at 10%. The ground of appellant is rejected." 4.3 The Tribunal endorsed the findings and view taken by the Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and parcel of the plant, functioning would aid an assessee's business activity. 5.3 In Niko Resources (supra), it was accordingly held reversing the decision of the Tribunal that the Tribunal was not right in law in treating mineral oil wells as Buildings for the purpose of applying rate of depreciation under Section 32 of the Act. It was held that mineral oil wells constitute "Plant" for the purpose of Section 32 of the Act. 6. In view of the above, no question of law much less substantial question of law as proposed by the assessee arise. No other question of law was found to be arising in the facts of the case from the impugned judgment of the Income Tax Appellate Tribunal. 7. In the aforesaid view, the present Tax Appeal is meri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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