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2008] 303 ITR 208 [2006] 157 TAXMAN 454 (ALL.) HIGH COURT OF ALLAHABAD Commissioner of Income-tax, Bareilly v. Bajpur Co-op. Sugar Factory Ltd. R.K. AGRAWAL AND RAJES KUMAR, JJ. IT REFERENCE NO. 61 OF 1998 JULY 11, 2005 Section 32 of the Income-tax Act, 1961, read with Appendix I of the Income-tax Rules, 1962 - Depreciation - Allowance/rate of - Assessment year 1989-90 - Whether where as per assessee's own claim, thermal efficiency of boiler installed in its Distillery unit was ranging from 72.5 per cent to 77.5 per cent which gave possibility of efficiency less than 75 per cent, it was not covered by specification provided in relevant entry in depreciation schedule (Appendix I) for grant of depreciation on high efficiency boilers at rate of 100 per cent - Held, yes R.K. Upadhayay for the Applicant. ORDER Rajes Kumar, J. - The Income-tax Appellate Tribunal has referred the following question of law under section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as 'Act') for the assessment year 1989-90 for opinion to this Court : "1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the assessee was entitled to grant of depreciation at the rate of 100 per cent on the cost of high efficiency boiler installed and used in the assessee's factory?" 2. The brief facts of the case are as follows :- The assessee/opposite party (hereinafter referred to as 'assessee') is Co-operative Society and runs a Sugar Factory as well as a Distillery unit. The facts of the case are that the assessee claimed 100 per cent depreciation on a high efficiency boiler installed and used in the year relevant to the assessment year. The Assessing Officer was of the view that the assessee had used bagasse as fuel instead of coal and the boiler did not have an efficiency of 75 per cent with economizer and with coal as fuel and, therefore, the assessee was not entitled to 100 per cent depreciation. 3. The assessee preferred an appeal against the said order before the CIT(Appeals). The CIT(Appeals) restored back the issue to the Assessing Officer for providing one more opportunity to the assessee to prove that the boiler has the…

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