Law:

Section:

section 32 of the Income-tax Act, 1961 - Depreciation - Allowance/Rate of - Whether roads owned by assessee and used by it for purposes of its business could be treated as buildings for purpose of grant of depreciation allowance - Held, that certain exceptional types of roads would be approximate to a building and be eligible for depreciation but since relevant facts were not available in instant case, it was remanded to Tribunal for disposal Facts The assessee claimed depreciation under section 32 in respect of the roads owned by it and used for the purposes of its business. The ITO disallowed the assessee's claim holding that the roads were not buildings, but at best an improvement on land. On appeal, the AAC allowed the assessee's claim on the ground that roads were not part of the land in the strict sense of the terms and were, therefore, a depreciable asset. On further appeal, the Tribunal affirmed the order of the AAC. On reference: Held In the absence of a statutory definition, or any indication in the statute as to any special meaning, the expression 'road' has to be understood in its grammatical sense. Ordinarily roads are not understood as buildings. There may, however, be exceptional roads such as a viaduct or a like structure of a permanent character involving such a degree of construction and expense as to be approximated to a building. Such roads, when owned and used by the assessee for the purpose of business, attract depreciation. Again, the character of the road in the context of a claim for depreciation has to be determined in each case on the basis of relevant facts and with reference to the principle stated above. In the instant case, neither the character of the roads in the context of a claim 'for depreciation had been determined, nor the principle of law had been correctly appreciated by the Tribunal. Accordingly, the case was sent back to the Tribunal with a director to determine the relevant facts and decide the case after applying the correct principle of law. Cases referred to CIT v. Colour-Chem Ltd. [1977] 106 ITR 323 (Bom.), Oil India Ltd. v. CIT [1978] 114 ITR 323 (Cal.), Ghanshiam Das v. Debi Prasad AIR [1966] SC [1998],…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492