SURESH ARTS Vs. THIRD INCOME-TAX OFFICER

JUDGEMENT

(1.) Per Shri , Senior Vice President. This appeal by the assessee relates to the assessment year 1982-83. The assessee is a registered firm of which the partners were K. Balajee having a 60% share and B. Suresh having a 40% share. The previous year of the assessee-firm ended on 30-6-1981.

(2.) The business of the assessee, as stated in the assessment order was "production of feature film and hiring of outdoor equipment". The assessee had claimed investment allowance of Rs. 67,662 in respect of plant and machinery with the dates of purchase are as under :- <FRM>JUDGEMENT_56_LAWS(MAD)12_19891.html</FRM> With reference to the aforesaid data, we have to clarify in respect of the item which appears as duty on Arsi Camera, that in respect of the cost of the camera itself no investment allowance is claimed. This is because, according to the assessee, the camera was received as a gift. The I. T. O., however, had brought the value of the camera to tax under the head business income by invoking the provisions of section 28(iv) of the I. T. Act, 1961 and the value so assessed as income was Rs. 1,73,670. We shall deal with this aspect when we come to the ground of appeal relating to the same.

(3.) The investment allowance claimed is 25% of the aggregate value of the machinery of Rs. 2,70,646. The claim for the investment allowance was disallowed by the I. T. O. on the ground that the condition of the machinery having been wholly used for the purposes of business carried on by the assessee was not satisfied. According to the I. T. O., the assessee had only lent the equipments on hire to third parties and in such cases investment allowance was not admissible and the ratio of the judgment of the Madras High Court in CWT v. P. T. N. Shenbagamoorthy, 1983 144 ITR 724 supported the stand.