COMMISSIONER OF INCOME TAX Vs. MOHTA CONSTRUCTION COMPANY

JUDGEMENT

(1.) THE Tribunal has referred the following question for the opinion of this Court : 'Whether, on the facts and in the circumstances of the case and on its interpretation of proviso to Section 32(1)(ii), the Tribunal was legally justified in holding each individual shuttering as machinery or plant for the purpose of allowing 100 per cent depreciation to the extent of Rs. 2,21,430 to the assessee whereas only a depreciation of 33 -1/3 per cent was held allowable by the AO on such integrated unit of plant and machinery in the case?'

(2.) THE business of the assessee is executing construction work for M.E.S., i.e., construction of buildings. The assessee acquired shuttering work worth Rs. 2,21,430 and claimed depreciation in terms of the provisions of Section 32(1)(ii) of the Act and he claimed 100 per cent depreciation on shuttering as the cost of each unit of shuttering is less than Rs. 5,000.

(3.) THERE is no dispute on the facts that assessee is engaged in construction work and without shuttering, the work cannot be executed. We agree with Mr. Mehta that shuttering being a necessary component for construction of the building, is a plant and each shuttering in itself is an independent unit, as that depends upon the use of shuttering in different places and each shuttering is costing less than Rs. 5,000, therefore, as per the rules, if the cost of the plant is less than Rs. 5,000, that plant is entitled for 100 per cent depreciation.