9911796707
TMI Blog1984 (10) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... vestment allowance is allowable shall be in a small scale industrial undertaking for the purposes of business of manufacture or production of any article or thing. Before the ITO it was submitted that the assessee's case was covered by the decision of Punjab & Haryana High Court in CIT vs. Yanuma Cold Storage (1981) 23 CTR (P&H) 15 : (1981) 129 ITR 728 (P&H). It was held in this case that the process undertaken in the cold storage falls within the definition of "manufacturing process", because it is a process of treating the articles or good with a view to preserve them for their use or sale. This case was under the Factories Act, 1948. The ITO observed that this case was distinguishable on its own facts. He was of the opinion that the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tative submitted that if the goods to which some labour was applied, remained essentially the same commercial article, it could not be said that the final product was the result of manufacture. 4. We have carefully considered the submission placed before us. We are of the opinion that it is a necessary for us to deal with the various case law to decide the present appeal as in our opinion, it is fully covered by some of the decisions of the Tribunal. The first decision is in the case of M/s Nand Lal Cold Storage, Moradabad vs. ITO Circle I Moradabad rendered by Delhi Bench of the Tribunal in I.T.A. No. 3979 (Del)/1982 dt. 27th April, 1984, which relates to the asst. yr. 1978-79. This decision followed another decision of Amritsar Bench of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the cold storage amounted to manufacture or production of any article or thing, what was that article or thing which was produced or manufactured. The counsel was unable to give any reply to this query of the Bench. On this basis, it was held that the investment allowance was not allowable to a cold storage. The query of the Bench in the above case was answered in the case of Nand Lal Cold Storage, Moradabad and sardar Waryam Singh Cold Storage, Amritsar by pointing out that it was the cold air which was produced by the cold storage and which was used for the purpose of preservation of the articles or goods stored. The case of Krishna Cold Storage, Shahjahanpur is, therefore, clearly distinguishable on its own facts and cannot be followed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nance (No. 2) Act, 1980. As per the amended section borrowings had to be excluded from the computation of capital. The retrospective effect of the amendment has been challenged before the Supreme Court. Besides, the decisions already cited above are also under challenge before the court. In view of this, the only direction that the can be given to the ITO is that he should keep the matter pending and decide the issue in accordance with decision/decisions of the Hon'ble Supreme Court. We direct accordingly. 8. We now take the departmental appeal. The assessee claimed depreciation at the rate of 10 per cent on the written down value of the buildings which was Rs. 8,84,304. This included cost of factory buildings amounting to Rs. 7,33,304. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orage building fell under the description of a factory building and was entitled to depreciation as applicable to a factory building. The ITO has, however, himself bifurcated the cost between building and chamber. He has held that the sorting sheds, office and servant block as well as boundary walls casting Rs. 1,51,000 were entitled to deprecation only at the rate of 5 per cent. On the other hand, he has allowed depreciation at higher rate at 10 per cent on the remaining value of the building. According to the Kanodia Cold Storage, these remaining buildings have to be treated as a plant and, therefore, they are entitled to the depreciation at the rate of 15 per cent. In our opinion, there is not dispute in principle between the two decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
