COMMISSIONER OF INCOME TAX Vs. COLOUR CHEM LIMITED

JUDGEMENT

(1.) TWO questions have been referred to this Court under S. 66(1) of the Indian IT Act, 1922, for our determination and these are as follows :

(2.) THE short facts leading to these questions may be stated :

(3.) ACCORDING to Mr. Hajarnavis, in the first place, the assets must be those indicated in sub cl. (vi), namely, buildings, machinery, plant or furniture and, secondly, the expression "such" that precedes the assets specified must, in view of sub cl. (iv) of S. 10(2), mean buildings, machinery, plant or furniture used for the purpose of business. He pointed out that roads or roadways that have been laid out inside the factory premises of the assessee are not one of the specified assets and the attempt of the assessee to claim depreciation thereon by suggesting that the roads or roadways constitute "buildings" cannot succeed, for, the normal concept of a building or buildings is referable to something that is constructed as a structure or superstructure on land and, therefore, no depreciation allowance can be allowed in respect of the roadways that have been laid out by the assessee company in its factory premises. He further pointed out that the expression "building" has not been defined in the Act and, therefore, the ordinary dictionary meaning of the expression will have to be taken into account and, according to the Shorter Oxford Dictionary, the expression "building" means "that which is built ; a structure", and ordinarily any structure in its popular sense would mean a structure which has walls and a roof and in this sense the roadways constructed by the assessee company cannot be regarded as failing in the category of building or buildings specified in sub cl. (vi) of S. 10(2). He also relied upon a decision of the Supreme Court in the case of CIT vs. Alps Theatre (1967) 65 ITR 377 (SC). He pointed out that in that case the expression "building" occurring in S. 10(2)(vi) of the Act came up for consideration and it was held that the word "building" in the said relevant provisions meant structures and did not include the site. In that case depreciation under S. 10(2)(vi) of the Act was claimed on the cost of land on which the building had been erected but the Supreme Court took the view that depreciation allowance could be allowed only on the cost of super structure and not on the cost of the site on which the super structure had been erected. He, therefore, contended that in this case also the roads or roadways which had been laid out by the assessee company should be held as not falling in the category of building or buildings mentioned in sub cl. (vi) of S. 10(2) of the Act and depreciation allowance should be disallowed.