Law: Income Tax Act, 1961

Section: 35,35D,32

(a) Income-tax--Depreciation--Roads and bridges not part of plant and machinery .for purpose of grant of depreciation---Indian Income Tax Act, 1961, S.32. (b) Income-tax--- ----Business expenditure---Amortisation of preliminary expenditure---Advertisement expenses---Allowable under S. 35D---Indian Income Tax Act, 1961, S.35D. (c) Income-tax--- ----Business expenditure---Capitalisation of pre-production expenses---Allowable. Held, that roads and bridges could not be treated as a part of plant and machinery for the purpose, of granting depreciation. CIT v. Gwalior Rayon Silk Manufacturing Co. Ltd: (1992) 196 ITR 149 (SC) applied. In view of the decision of the High Court in the case of the same assessee, Madras Fertilizers Ltd. v. CIT (1994) 209 ITR 174 (Mad.), for earlier years, the Appellate Tribunal was correct in law in allowing the capitalisation of the pre-production expenses and in holding that the assessee was entitled to deduction of advertisement expenses under section 35D of the Income Tax Act,. 1961. Madras Fertilizers Ltd. v. CIT (1994) 209 ITR 174 (Mad.) fol. JUDGMENT NN. BALASUBRAMANIAN, J.- -At the instance of the Revenue, the following questions of law have been referred to us for our consideration in respect of the assessment year 1977-78: "(1) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in holding that depreciation at the general rate applicable to plant and machinery should be allowed on roads and bridges? (2) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was correct in law in not upholding the order of the Income-tax Officer as such rejecting capitalisation of the reproduction expenses? (3) Whether, the Tribunal's finding that the assessee is entitled to deduction under section 35D of the Income-tax Act is sustainable in law and. is a reasonable view to take of the facts obtaining in this case?" The assessee is a company and- during the course of its assessment proceedings for the assessment year 1977-78 claimed the capitalisation of pre-production expenses, depreciation on roads and bridges on the ground that they were out of the buildings which form part of…

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