COMMISSIONER OF INCOME TAX Vs. MAHAVIR CONSTRUCTION COMPANY

JUDGEMENT

(1.) THIS is a IT reference under S. 256(1) of the IT Act, 1961 at the instance of Revenue and the following two questions of law have been referred by the Tribunal for answer by this Court :

(2.) ASSESSEE is a registered firm and is engaged in the execution of various contract works. During the year under consideration, the firm was awarded a new contract known as 'reclamation and screening of iron ore at Aridongari' by Bhilai Steel Plant by order dt. 20th Jan., 1988. For execution of this contract, the assessee purchased Poclain machinery which was delivered at Aridongari and used for the execution of the new contract. The AO allowed depreciation on poclain machine for a period of 14 months as against 23 months claimed by the assessee in accordance with S. 3 of the IT Act, 1961 w.e.f. 1st April, 1989. This finding of the AO was upheld by the CIT(A). Thereafter, the assessee approached the Tribunal and the Tribunal granted a depreciation on poclain machinery for a period of 23 months. Hence, the Revenue has approached the Tribunal for referring the aforesaid two questions for answer by this Court and the Tribunal has referred the same to this Court for its answer.