Law:

Section:

Section 43(3) of the Income-tax Act, 1961 - Plant - Whether where a building is an integral part for carrying on business of manufacture, it would be a plant, otherwise, it would merely constitute a place where business is carried on and would not be recognised as plant - Held, yes - Whether, therefore, a building constructed specifically for carrying on manufacturing of atta and maida on which rolling flour mill is attached is a plant - Held, yes FACTS The assessee was engaged in the business of manufacture and sale of atta & maida, etc., for the manufacture of which it had established a rolling flour mill. The factory building on which rolling flour mill was attached was claimed by the assessee as plant. On appeal : HELD Section 43(3) indicates that the definition of 'plant' is inclusive and shall include other things, which have not been mentioned in that sub-section, if it partakes of the character plant. [Para 7] From the judicial pronouncements the following principles emerge on the basis of which a building can be treated as 'plant' : All buildings cannot be a plant but for that reasons all buildings cannot be excluded from treating it as plant simply because it is building. The building can in the given circumstance be treated as plant, when the building in question can be considered as a means of carrying on business. When the building in question is an apparatus or a tool of taxpayer, as against merely a space only from where the taxpayer carries on business, it can be treated as plant. If a building is an integral part for carrying on the business of manufacture it would be a plant whereas if the structure plays no part in carrying on any of the activity relating to manufacture, it would merely constitute a place where the business is carried on and, it cannot be recognised as plant. When the assessee with a definite purpose, considering the nature of business carried on by the assessee, constructs a building with specific required design, keeping in view specific technical requirement, without which the assessee's business cannot be carried out, the building in question would qualify to be treated as plant. [Para 14] In the instant case, the…

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