COMMISSIONER OF INCOME TAX VISAKHAPATNAM Vs. M/S.VIZAG DISTRICT MILK PRODUCERS CO-OP. UNION LIMITED VIZAGDISTRICT MILK PRODUCERS CO-OP. UNION LIMITED DISTRICT MILK PRODUCERS CO-OP. UNION LIMITED VIZAG

JUDGEMENT

(1.) The respondent (the assessee) is engaged in the business of processing milk and manufacturing by-products like ghee, flavoured milk, butter milk, rose milk and kova (hereafter referred to as milk products). In their return of income for the assessment year 1983-84, they claimed investment allowance of Rs.29,957/- on plant and machinery installed during the year relevant to the assessment year.

(2.) The Income Tax Officer, Visakhapatnam, while assessing the income under Section 143(3) of the Income Tax Act, 1961 (the Act) allowed the deduction under Section 32A of the Act. The Commissioner of Income Tax, Visakhapatnam (CIT) suo moto undertook revision under Section 263 of the Act. By order dated 23.3.1988, the assessment was set-aside holding that the assessee is not entitled to any investment allowance for the year 1983-84. Being aggrieved, the assessee preferred an appeal before the Income Tax Appellate Tribunal, Hyderabad (the Appellate Tribunal). Following the assessee's cases for assessment years 1981-82 and 1982-83 being I.T. Nos.924 and 925 of 1987, the Appellate Tribunal set aside the order of CIT.

(3.) The Revenue filed an application under Section 256(1) of the Act for referring the question to this Court.