Commissioner of Income Tax vs Caltex (India) Ltd.

T.D. Sugla, J.—The only question raised in this reference at the instance of the Department is :

"Whether, on the facts and in the circumstances of the case, the assesee is entitled to depreciation on roads, walks, driveways and approach roads inside the factory premises on the footing that they constitute ''plant'' ?"

On the face of it the question is covered against the assessee by this court''s judgment in CIT v. Sandvik Asia Ltd. [1983] 141 ITR 585. However, it is pointed out by Mr. Munim, learned counsel for the assessee, that the Appellate Assistant Commissioner had allowed depreciation to his client on roads, walks, driveways and approach roads inside the factory premises on the footing that they constituted building and not plant. However, the Department went in appeal to the Tribunal and the Tribunal on its own gave further relief to the assessee by holding that the roads, walks, driveways, etc., constituted plant and, therefore, the assessee was entitled to a higher rate of depreciation. It is contended by Mr. Munim that his client should at least continue to avail of the depreciation granted to him by the Appellate Assistant Commissioner at a lower rate on the footing that the roads, walks, driveways, etc., contitute building. The submission is reasonable. We have no doubt that the Tribunal will, while giving effect to this order, take th constitute is aspect into account.

No order as to costs.