COMMISSIONER OF INCOME TAX Vs. PERIYAR CHEMICALS LIMITED

JUDGEMENT

(1.) The following question has been, at the instance of the revenue, referred to us by the Income Tax Appellate Tribunal, Cochin Bench:

(2.) S.32 of the Income Tax Act, 1961, in so far as it is material, reads:

(3.) The views expressed in various decisions of the High Courts on this question do not seem to be uniform. In certain decisions, the High Courts of Bombay, Calcutta, Andhra Pradesh and Madras have taken the view that all roads owned by an assessee and used for the purposes of the business are buildings in respect of which S.32 allows depreciation at the rates specified under Part I of Appendix I of the Income Tax Rules, 1962. On the other hand in Oil India Ltd. v. C. I. T., (1978) 114 ITR 323, the Calcutta High Court takes the view that merely because a road is used for the purposes of the business, it cannot be regarded as a building, unless it has been constructed in such a way as to be capable of being regarded as a building. In so saying, the Calcutta High Court followed the reasoning of the Supreme Court in Ghanshiam Das v. Debi Prasad. AIR 1966 SC 1998 . On the other hand, the Bombay High Court in C.I. T. v. Colour-Chem Ltd., (1977) 106 ITR 323 referred to this decision of the Supreme Court and came to a different conclusion from that which was reached by the Calcutta High Court in Oil India Ltd. v. C. I. T., (1978) 114 ITR 323. The Bombay High Court stated that where it was shown that a road was owned and used by an assessee for the purposes of his business, such road qualified for being regarded as a 'building' for the purpose of depreciation Decisions in Hukamchand Mills Ltd. v. C.I.T, (1978) 114 ITR 870 (Bom.); Panyam Cements & Mineral Industries v. C. I. T. (1979) 117 ITR 770 (A. P.); C. I. T. v. Lucas T. V. S. Ltd., (No. 2), (1977) 110 ITR 346 (Mad.); and C. I. T. v. Kalyani Spinning Mills Ltd., (1981) 128 ITR 279 (Cal.) adopted more or less the same line of reasoning as in C. I. T. v. Colour-Chem Ltd., (1977) 106 ITR 323 (Bom. ). The Calcutta High Court in C. I T. v. Indo-Burma Petroleum Co. Ltd., (1978) 112 ITR 755 regarded driveways and compound walls in petrol pumps as buildings.