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Section 32 of the Income-tax Act, 1961 - Depreciation - Allowance/Rate of - Assessment year 1977-78 - Assessee-company claimed depreciation on plant and machinery of its vegetable ghee unit - Assessing Officer rejected assessee's claim on ground that plant and machinery was not actually used for full year relevant to assessment year 1977-78 - On appeal, Tribunal, on finding that vanaspati unit though was not actually in use, but it was kept ready for use and all efforts were made to restore said unit as soon as possible, allowed claim of assessee - Whether since there was no intention on part of assessee to close said unit in relevant assessment year, but on account of adverse circumstances, said unit remained suspended and could not be operated in year in question, view taken by Tribunal was legally justified - Held, yes CASES REFERRED TO Mysore Minerals Ltd. v. CIT [1999] 239 ITR 775 / 106 Taxman 166 (SC) [Para 4], CIT v. Podar Cement (P.) Ltd. [1997] 226 ITR 625 / 92 Taxman 541 (SC) [Para 4], Machinery Mfg. Corpn. Ltd. v. CIT [1957] 31 ITR 203 (Bom.) [Para 5], CIT v. Refrigeration & Allied Industries Ltd. [2001] 247 ITR 12 /[2000] 113 Taxman 103 (Delhi) [Para 5], CIT v. Pepsu Road Transport Corpn. [2002] 253 ITR 303 / 121 Taxman 232 (Punj. & Har.) [Para 6] and Anil Bulk Carrier (P.) Ltd. v. CIT [2005] 142 Taxman 673 (All.) [Para 7]. Vikram Gulati for the respondent. ORDER P. Krishna, J. - The Income-tax Appellate Tribunal, Delhi, at the instance of the Income-tax Department has referred the following question of law under section 256(2) of the Income-tax Act, 1961 (hereinafter referred to as the Act) for opinion to this Court :- "Whether on the facts and in the circumstances of the case, the Tribunal was legally justified in allowing the claim of depreciation of Rs. 1,91,917 on the Plant & Machinery of Vegetable Ghee Unit as these were not actually used for the full year relevant to the assessment year 1977-78?" 2. The assessee is a limited company running a sugar factory, distillery, confectionery and vanaspati units. It did not operate the plant during the accounting year relevant to the assessment year 1977-78. But it claimed depreciation on…

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