High Court of Punjab and Haryana, Chandigarh
Case Law Search
THE COMMISSIONER OF INCOME TAX, PATIALA v. M/S PURE DRINKS PVT. LTD., C/O S.MOHAN S - ITR-88-1988  RD-P&H 3355 (22 May 2006)
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
I.T.R. NO. 82 OF 1988
DATE OF DECISION: 19.04.2006
THE COMMISSIONER OF INCOME TAX, PATIALA
M/S PURE DRINKS PVT. LTD., C/O S.MOHAN SINGH BUILDING CONNAUGHT LANE, NEW DELHI.
CORAM: HON'BLE MR.JUSTICE ADARSH KUMAR GOEL
HON'BLE MR. JUSTICE RAJESH BINDAL
PRESENT: MR. D.S. PATWALIA, ADVOCATE
FOR THE PETITIONER.
MR.AKSHAY BHAN, ADVOCATE
FOR THE RESPONDENT.
The following question of law has been referred to this Court for it's opinion by the Income Tax Appellate Tribunal, Delhi Bench 'B' : New Delhi ( for short "the Tribunal") arising out of it's order dated 16.2.1988 in ITA No.2769(DEL)/ 1984, for the assessment year 1978-79: "Whether on the facts and in the circumstances of the case the Tribunal was right in allowing depreciation on bottles by treating them as plants ?"
The assessee company, which was carrying on business of bottling of Coca-Cola during the year in question, claimed 100 per cent depreciation on Campa bottles on the plea that they constitute plants in the business of bottling. The claim of the assessee was declined by the Assessing Officer. However, deduction were allowed to the extent of actual breakage. In appeal the Commissioner of Income Tax (Appeals) accepted the plea of the assessee. The Tribunal dismissed the appeal filed I.T.R. NO. 82 OF 1988 
by the Revenue by following its earlier order in ITA No. 2770 (DEL)/1984 in the case of I.A.C. (Asstt.) Patiala versus M/s Pure Drinks ( New Delhi) ltd.
We have heard Sh. D.S. Patwalia, Advocate for the Revenue-petitioner and Sh. Akshay Bhan, Advocate appearing for the assessee-respondent.
At the very out set, the counsel for the assessee cited a series of judgments of various Courts taking the view that the bottles used by the soft drinks manufacturers and sellers constituted plant and accordingly the assessee is entitled to claim depreciation on the same. It has further been held therein that each bottle constituted plant as the same by its very nature is required to be used individually. The judgments, on the issue, referred to by the counsel for the assessee and which could not possibly be disputed by the counsel for the Revenue are First Leasing Co. of India ltd. v. Commissioner of Income-tax (No.2), (Mad.) (2000) 244 ITR 238, C.I.T. v. Margadarsi Chit Fund (P.) Ltd. (A.P.), (1997) 227 ITR 646, C.I.T.
v. Prem Nath Monga Bottlers (P.) Ltd. (Delhi), (1997) 226 ITR 864, C.I.T. v. Jat Drinks (P.) Ltd. (Raj.), (1988) 173 ITR 100, C.I.T. v. Sri Krishna Bottlers Pvt. Ltd. (A.P.), (1989) 175 ITR 154, C.I.T. v.
Saurashtra Bottling Pvt. Ltd. (Guj.), (1998) 232 ITR 270, C.I.T. v. Steel City Beverages (P) Ltd. (Patna), (1996) 222 ITR 744.
It has further been pointed out by the counsel for the assessee that against the judgement of Andhra Pradesh High Court reported in C.I.T. v. Sri Krishna Bottles Pvt. Ltd. (A.P.),  175 ITR 154, Special Leave Petition filed by the Revenue was dismissed by Hon'ble the Supreme Court on 11.7.1994 as reported in  209 ITR (Statutes) 85.
A reference has also been made to the dismissal of SLP filed by Revenue on 31.10.2003 against the judgment of Allahabad High Court in ITA No. 39 of 1999 on the same issue which is reported as  266 I.T.R. NO. 82 OF 1988 
ITR (Statutes) 2.
The counsel for the Revenue could not point out any distinction in the catena of the judgments of different High Courts as referred to above, which squarely cover the question of law referred to this Court by the Tribunal and he also could not point out any other judgment of any Court taking a contrary view on the issue.
Keeping in view the consistent view taken by different Courts on the question of law referred to this Court, to which we are completely in agreement, we answer the question of law referred to this Court in favour of the assessee and against the Revenue.
April 19, 2006 (ADARSH KUMAR GOEL)
Double Click on any word for its dictionary meaning or to get reference material on it.