Law:

Section:

Section 32 of the Income-tax Act, 1961 - Depreciation - Allowance/rate of - Assessment year 1989-90 - Whether nursing home of assessee could be treated as a hotel for purposes of depreciation - Held, no Section 254 of the Income-tax Act, 1961 - Appellate Tribunal - Powers of - Assessment year 1989-90 - Whether where assessee raised a new plea before Tribunal that its nursing home was to be treated as a plant for purpose of depreciation, as no such claim was made before assessing authority as also before Commissioner (Appeals), Tribunal was perfectly justified to refuse to entertain claim regarding depreciation on nursing home building at rate which is applicable to a plant - Held, yes CASES REFERRED TO Addl. CIT v. Gurjargravures (P.) Ltd. [1978] 111 ITR 1 (SC) [Para 3], CIT v. Dr. B. Venkata Rao [2000] 243 ITR 81(SC) [Para 5], Jute Corpn. of India Ltd. v. CIT [1991] 187 ITR 688 (SC) [Para 5] and CIT v. Dr B. Venkata Rao [1993]202 ITR 303 (Kar.) [Para 5]. ORDER R.K. Agrawal, J. - The Income-tax Appellate Tribunal, Allahabad has referred the following questions of law under section 256(1) of the Income-tax Act, 1961 ('the Act') for opinion to this Court :- "1 .Whether, on the facts and in the circumstances of the case, the nursing home of the assessee could be treated to be a plant for the purposes of depreciation? 2 .Whether, on the facts and in the circumstances of the case, the nursing home of the assessee could be treated as a hotel for the purposes of depreciation?" 2. The reference relates to the assessment year 1989-90. 3. Briefly stated, the facts giving rise to the present reference are as follow:- The applicant's source of income are salary and profession. She is running a nursing home, called 'Krishna Medical Centre' at Lucknow. The applicant claimed depreciation on the building of the nursing home at the rate of 20 per cent, the rate applicable to a hotel. The assessee's claim before the Assessing Officer was that the nursing home provided lodging to the patients on daily rent and, therefore, it was like a hotel. The Assessing Officer rejected the claim holding that the nursing home could not be treated as a hotel or as a boarding house and allowed…

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