Extra shift allowance is to be calculated separately in the proportion which the number of days for which the concern worked triple shift bears to the normal number of working days throughout the previous year and the normal allowance which forms the basis of measure of extra allowance will be the amount of depreciation allowance that would have been allowed under Rule 5 if the machinery or plant had been used during the previous year for a period of 180 days or more.

( 1 ) IN this reference under section 256 (1) of the Income-tax Act, 1961 the Tribunal has referred the following question of law : ?whether, on the facts and circumstances of the case, the Tribunal is right in holding that the extra-shift allowance on machinery worked triple shift should be calculated with reference to the actual number of days each item of machinery had been put to use and not on the number of days the concern had worked in the previous year in view of section 32 of the Income-tax Act, 1961 and the rules thereunder??

( 2 ) THE facts of the case have been set out in the statement of the case and may be briefly stated. The assessee is a company engaged in the manufacture of yarn. The assessment year in question is 1964-65, the previous year in respect of which ended on 31. 12. 63. For this assessment year the assessee, in addition to its claim for a sum of Rs. 3,19,914/- as normal depreciation on machinery, also claimed an equal amount as extra shift allowance on the ground that the factory worked triple shift for 330 days during the previous year. The Income-tax Officer allowed a sum of Rs. 2,86,985/- in respect of the assessee's claim for extra shift allowance and disallowed the assessee's claim to the extent of Rs. 32929/ -. The Income-tax Officer found that some of the items of machinery had not been used for the entire period of the triple shift as those items of machinery were installed on different dates in the year. Calculating from the dates of installation, the Income-tax Officer arrived at the number of days each item of machinery was put to use during the year of account and allowed proportionate extra shift allowance which came to the said figure of Rs. 2,86,985/ -. The assessee had claimed before the Income-tax Officer that extra shift allowance should be allowed for a sum equivalent to the normal depreciation, which in this case has been allowed to the assessee to the extent of Rs. 314742/ -. Though no reasons were stated by the Income-tax Officer in its order for not allowing the entire claim of the assessee, the Income-tax Officer in a note attached to the assessment order stated that he allowed the extra shift allowance according to the number of days the machinery were put to use during the year. Aggrieved by the order of the Income-tax Officer the assessee preferred an appeal to the Appellate Assistant Commissioner and contended before him that the allowance granted by the Income-tax Officer was not in consonance with the rules made in this regard and relied upon the remarks against item 3 in the statement of rates at which depreciation is admissible. Construing the said rule the Appellate Assistant Commissioner held that the rules did not provide for the computation of extra shift allowance on each machine with reference to the number of days, it was put to use, and the Appellate Assistant Commissioner the assessee's appeal and directed the Income-tax Officer to grant extra shift allowance as claimed by the assessee. Against the order of Appellate Assistant Commissioner the department preferred an appeal to the Tribunal and the contention of the department before the Tribunal was that the order of the Appellate Assistant Commissioner was wrong and against the rules and the extra shift allowance granted by him should be withdrawn. The Tribunal held that the Appellate Assistant Commissioner was wrong in holding that the extra shift allowance was admissible on the items of machinery irrespective of the number of days to which they had been put to use in the accounting year. In the opinion of the Tribunal depreciation was allowable in respect of each item of machinery or plant separately and the allowance of normal depreciation depends admittedly upon the actual user of the machinery or plant during the previous year. In the opinion of the Tribunal when normal depreciation allowance is to be granted on each item of machinery as per the number of days it had worked, the extra shift allowance sh

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