TMI Blog1980 (11) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... d that depreciation should be allowed on these roads at the rate applicable to first class buildings. The revenue felt aggrieved by this order. It went up in appeal before the Tribunal. The Tribunal, following its previous decision, upheld the assessee's contention and dismissed the appeal and held that these roads were entitled to depreciation at the rate applicable to first class building materials. On the aforesaid facts the following question has been referred to this court : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that depreciation was allowable in respect of the roads within the factory compound and the compound of the residential quarters of the factory employees and that such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the revenue emphasised that in order to be entitled to depreciation the building or the plant or the machinery must not only be owned by the assessee but should also be used for the purpose of business. In this contention he is undoubtedly right. He also drew our attention to s. 37 which provides for the allowance of expenditure laid out wholly and exclusively for the purposes of business. His point was that in some cases expenditure for the roads might be laid out for the purpose of business but that did not automatically or necessarily mean that such building, plant or machinery is used in the business. He also drew our attention to s. 38 of the Act which stipulates that if an expenditure is incurred, which is partly in respect of build ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , there cannot be any doubt that the roads within the factory compound form part of the building which is used for the purpose of business and as such are entitled to depreciation. So far as the compound of the residential quarters of the factory employees, it appears, in the present context, it is very often obligatory, for the management of the factory to provide residential quarters for the employees of the factory and such residential quarters of the factory employees being for the residence of the employees these are also used for the purpose of the business. It is true that these are not directly used for the purpose of the business but there is no warrant to restrict the meaning of the expression " used for the purpose of business ". ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich was designed and built to the assessee's requirements, was sectionalised and farther sections could be added. It consisted of an aluminium roof with fascia and cladding supported on four steel columns. The steel columns were bolted to sunken concrete bases which Were embedded in concrete islands. The tops of the pillars were fitted to steel frames by nuts and bolts. The only equipment mounted on the canopy was for lighting. The Inspector of Taxes refused capital allowances on the cost of the canopy. On appeal, the assessee-company contended that the canopy formed an integral part of the petrol pump complex and was, therefore, plant employed in the business. On behalf of the Crown, it was contended that the canopy was the setting, or par ..... X X X X Extracts X X X X X X X X Extracts X X X X
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