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Section 32(1)(i) of the Income-tax Act, 1961 - Depreciation - Allowance of - Whether depreciation could be granted on cost of construction of roads on footing that roads were part of factory building - Held, yes Section 80J of the Income-tax Act, 1961 - Deductions - Fronts and gains from newly established industrial undertakings - Whether items like value of work-in-progress and value of unallocated capital expenditure were includible in capital for purposes of working out relief under section 80J - Held, yes Facts The Tribunal upheld the assessee's claim that depreciation could be granted on the cost of construction of roads on the footing: that roads were part of factory building. It further upheld the assessee's claim that the value of work-in-progress as well as the value of unallocated capital expenditure were includible in capital for purposes of working out relief under section 80J for the assessment year 1968-69. On reference : Held Following the ratio of decisions in CIT v. Colour-Chem. Ltd. [1977] 106 ITR 323 ( Bom.) and CIT v. Advani Oerlikon (P.) Ltd. [1986]161 ITR 449 ( Bom.), respectively, the Tribunal was justified in its aforesaid findings. Cases referred to CIT v. V. Damodaran [1980] 121 ITR 572 (SC), CIT v. Colour-Chem. Ltd. [1977] 106 ITR 323 (Bom.), CIT v. Advani Oerlikon (P.)Ltd. [1986] 161 ITR 449 (Bom.), CIT v. Alcock Ashdown & Co. Ltd. [1979] 119 ITR 164 (Bom.) and CIT v. Indian Oxygen Ltd. [1978]113 ITR 109 (Cal.). G.S. Jetley and S.V. Naik for the Applicant. A.V. Sonde for the Respondent. 4. Whether, on the facts and in the circumstances of the case, the following items are includible in capital for purposes of working out relief under section 80J for assessment year 1968-69 : Rs. 1. Value of work-in-progress 65,497 2. Value of unallocated capital expenditure 9,225." Of these four question Nos. 1, 2 and 4 arise from the appellate order wherein the decision was against the revenue and it was the revenue which had sought reference in respect of these three questions. How- ever, as far as the computation of capital for the purpose of relief/deduction under section 84/80J of the Act for the assessment year 1937-68 is concerned, the…

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