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Section 43(3) of the Income-tax Act, 1961 - Plant - Assessment year 1986-87 - Whether in case of construction of a building, each item of shuttering material does not form a 'plant' in itself and, thus, it is not entitled to depreciation at rate of 100 per cent under first proviso to section 32(1)(ii) - Held, yes [In favour of revenue] FACTS The assessee-firm was a civil contractor. In their return for 1986-87, the assessee claimed depreciation at 100 per cent towards purchase value of centering and shuttering equipment. The assessee's plea was that the cost of each item was below Rs. 5,000. The Assessing Officer allowed the depreciation at the rate of 15 per cent. The Commissioner (Appeals) reversed the order of the Assessing Officer agreeing with the assessee that each item of centering, shuttering and scaffolding material cost less than Rs. 5,000 and, therefore, they were entitled to claim depreciation at 100 per cent as per proviso to section 32(1)(ii). The Tribunal confirmed the appellate order. On revenue's appeal : HELD The word 'centering' or 'shuttering' is a false work erected to give temporary support to 'concrete structure' and it is removed after the concrete structure gains strength. [Para 18] It is well-settled that shuttering is not an integrated component forming a plant. It consists of metal and non-metal props, pipes/right angles, sewer clamps, fixed base plates, wooden poles, wooden planks, plates, steel and aluminium boxes, wooden shapes and anything which can be used to support a suspended wall, reinforced cement concrete slab, an arch, a sunshade, a cantilever cement structure as support when such structures are being built with cement concrete. The purpose of the shuttering is only till the setting of the cement concrete or cement material. The moment the cement concrete achieves the required setting, the shuttering material is removed and used or reused in other constructions. To that extent, the assessee did not dispute. In the very nature of things, and as understood in the construction industry, a single metal or wooden pole or supporting material is never understood as forming shuttering material. The owner of the building under…

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