INCOME TAX APPELLATE TRIBUNAL, MADRAS
P.K. Bansal, N.D. Raghavan, JJ.
Metal Powder Co. Ltd. -Appellant
Versus
Deputy Commissioner of Income tax -Respondent
ITA NO. 3723(MAD) OF1990
Decided On : 30-03-1998
S. Sridhar,S. Ganapathy Iyer
P.K. Bansal, A.M. - This appeal is filed by the assessee against the order of the CIT(A) for the assessment year 1987-88. The first ground of appeal is general in nature. Ground No. 4 of the grounds of appeal is not pressed and, therefore, it stands dismissed as not pressed. The rest of the grounds of appeal are dealt with as under.
2. Ground No. 2 deals with the disallowance of extra shift allowance amounting to Rs. 33,462 in respect of computers. The authorised representative of the assessee pointed out that computer is plant and, therefore, the assessee is entitled for extra shift allowance on computers. The learned Departmental Representative pointed out that the assessee has not produced any details as to where the computers are installed and whether the computers were used for the business of the assessee. He relied on the orders of the authorities below. To a question from the Bench as to the nature of the business of the asessee and how far computers are relevant, the authorised representative pointed out to the observation of the CIT(A) that the computers in the present case were very much in the factory premises itself and they are part of the plant used in appellant’s business. We have gone through the contentions of the parties and perused the records. We find that the assessee has not filed any material to ascertain whether computer is part of plant in the case of the assessee or not. We are, therefore, inclined to agree with the authorities below disallowing a sum of Rs. 33,462 as extra shift allowance on computers.
3. The third ground of appeal relates to disallowance of investment allowance and depreciation on the borewell. The assessee’s authorised representative pointed out that borewell is a plant and, therefore, the assessee should be allowed investment allowance and also depreciation at the rate of 15 per cent. He further relied on the decision of the Calcutta High Court in the case of CIT v. Hindustan Motors Ltd. [1988]
4. Ground Nos. 5 and 6 relate to the addition of a sum of Rs. 42,967 on account of the amount received by the assessee from insurance claims in respect of damage to the machinery. The authorised representative argued that there was damage to the machinery due to the fire and when loss was claimed the insurance company had paid a sum of Rs. 42,967 and the Assessing Officer was not correct in holding that the above sum was revenue receipt. In this regard he relied on the decision of the Bench of this tribunal in ITA No. 1108/Mad/1986, dated 16-6-1988, for the assessment year 1983-84 and also on the decision of the Madras High Court in the case of C. Leo Machodo v. CIT [1988] 67 CTR (Mad) 95 : [1988]