Law: Income Tax Act, 1961

Section: 32A

Section 32A of the Income-tax Act, 1961 - Investment allowance - Whether if a plant and machinery is installed and some raw material, which may be in form of tangible or intangible article, is used and end result is something different and even if it is in form of report of figures, then activity would be taken to be an industrial undertaking and such plant and machinery would be entitled to investment allowance - Held, yes - Whether where assessee-trust, was running pathological laboratory as its business adventure, it was entitled to investment allowance on expenditure incurred for pathological equipments - Held, yes FACTS The assessee-trust, which was running a pathological laboratory, installed new machinery in its clinic and claimed investment allowance under section 32A. The Tribunal held that the assessee who was engaged in a profession of pathological laboratory could be said to be carrying on a business as an industrial undertaking, which produced an article or thing and was, thus, entitled to investment allowance under section 32A on the new machinery installed in the clinic. On reference : HELD If a plant and machinery is installed and some raw material, which may be in form of tangible article or intangible article is used and end-result is something different, and even if it is in form of a report of figures, then the activity would be taken to be an 'industrial undertaking' and such plant and machinery would be entitled to investment allowance. The Tribunal was absolutely justified in observing that the assessee-trust, which was running pathological laboratory as its business adventure, was entitled to investment allowance on the expenditure incurred for pathological equipments. [Para 9] CASES REFERRED TO CIT v. Dr. S. Surender Reddy [2000] 243 ITR 110/[2002] 123 Taxman 166 (AP) [Para 3], Natvarlal Ambalal Dave v. CIT [1997] 225 ITR 936 (Guj.) [Para 6], CIT v. Trinity Hospital [1997] 225 ITR 178/[1996]87 Taxman 127 (Raj.) [Para 6], CIT v. Upasana Hospital [1997] 225 ITR 845/[1996] 89 Taxman 525 (Ker.) [Para 6], CIT v. Professional Information Systems & Management [2005] 274 ITR 242/ 146 Taxman 673(Guj.) [Para 6], CIT v. Peerless Consultancy…

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