High Court of Judicature at Allahabad
Case Law Search
Govind Cold Storage v. The Commissioner Of Income Tax - INCOME TAX REFERENCE No. 51 of 1990  RD-AH 1099 (20 April 2005)
INCOME TAX REFERENCE NO.51 OF 1990
M/s Govind Cold Storage and General
Mills, Muzaffarnagar. ....Applicant
The Commissioner of Income-tax, Meerut. ....Respondent
Hon'ble R.K. Agrawal, J.
Hon'ble Rajes Kumar, J.
The Income Tax Appellate Tribunal, New Delhi has referred to following question of law under section 256 (1) of the Income Tax Act, 1961, (hereinafter referred to as "the Act") for opinion of this Court.
"1. Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessment order made by the IAC granting Investment Allowance in respect of plant and machinery installed in a cold storage was erroneous and prejudicial to the interest of Revenue ?"
2. Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the IAC (A)'s order granting depreciation in respect of generator taking its cost to the assessee at Rs.2,05,140/- was not erroneous and prejudicial to the interest of revenue?"
The present Reference relates to the Assessment Year 1983-84.
Briefly stated the facts giving rise to the present Reference are as follows:
We find that the first question referred is squarely covered by the decision of the Apex Court in the case of Additional Commissioner Vs. Delhi Cold Storage , reported in 191 ITR, 656, wherein Apex Court has held that in cold storage no manufacturing process is done and cold storage and no industrial undertaking within the meaning of section 32-A of the Act. Thus we answer the first question referred to us in the affirmative, i.e. in favour of the Revenue and against the assessee.
So far as second question is concerned, we find that in the case of CIT Vs. P.J. Chemicals, reported in 210 ITR, 830 Apex Court has held that the amount of subsidy is not to be deducted while calculating the cost under section 43 (1) of the Act for the purpose of depreciation. Thus the order passed by the assessing authority in which the amount of subsidy was not reduced while calculating the cost of generator could not be said to be erroneous and prejudicial to the interest of Revenue.
Respectfully following the aforesaid decision, we answer the second question in affirmative, i.e. in favour of the assessee and against the Revenue. However, there shall be no order as to costs.
Double Click on any word for its dictionary meaning or to get reference material on it.