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[2008] 301 ITR 255 (MAD.) HIGH COURT OF MADRAS Commissioner of Income-tax v. Southern Petrochemical Ind. Corpn. Ltd. K. RAVIRAJA PANDIAN AND MRS. CHITRA VENKATARAMAN, JJ. TAX CASE (APPEAL) NO. 42 OF 2008 FEBRUARY 4, 2008 Section 32 of the Income-tax Act, 1961 - Depreciation - Allowance/rate of Stand-by assets which are kept ready for use during relevant assessment year, are entitled to depreciation In view of the decision of the Division Bench of the Madras High Court in the case of CIT v. Southern Petrochemical Industries Corporation Ltd. [2007] 292 ITR 362, the machinery could be said to be used for the purposes of business so long as it is kept ready for such user. Any "forced idleness" of the machinery cannot disentitle the assessee from getting the benefit of the allowance. Thus, stand-by assets, which are kept ready for use during the relevant assessment year, are entitled to depreciation. J. Naresh Kumar for the Appellant. JUDGMENT K. Raviraja Pandian, J.- This appeal has been filed against the order of the Income-tax Appellate Tribunal in I.T.A. No. 141/Mds/2004, dated October 13, 2006. The relevant assessment year is 2000-01. The assessee-company filed a return of income for the assessment year 2000-01 on November 28, 2000, declaring a gross total income of Rs. 18,98,72,520 and after setting off an unabsorbed depreciation from the assessment year 1994-95, arrived at a net taxable income of Rs. nil. The assessee, inter alia, claimed deduction of expenditure incurred on issue of debentures and collection of fixed deposits as revenue expenditure. The Assessing Officer disallowed the same, as also the depreciation on standby machinery. Aggrieved by the assessment orders, the assessee filed appeals before the Commissioner of Income-tax (Appeals), who allowed the same based on the orders passed for the earlier years on the same issues. The Revenue took the matter on further appeal to the Income-tax Appellate Tribunal. The Income-tax Appellate Tribunal confirmed the orders of the Commissioner of Income-tax (Appeals). Hence, the present appeal has been filed by formulating the following substantial questions of law: "1.Whether, on the facts and circumstances…

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