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Issues Involved:
The judgment addresses the classification of 'bottles' and 'crates' as 'plant' for depreciation under section 32(1)(ii) of the Income-tax Act, entitlement to development rebate, and relief under section 80J. Classification of 'Bottles' and 'Crates' as 'Plant' for Depreciation: The Andhra Pradesh High Court in CIT v. Sri Krishna Bottlers Pvt. Ltd. established that 'bottles' were essential tools of trade, enabling the transportation of soft drinks to customers. The interdependence between bottles, shells, and the soft drink itself was crucial. The durability test was satisfied as their lifespan was significant. Rulings from other High Courts, such as the Rajasthan High Court in CIT v. Jai Drinks (P.) Ltd., supported this classification. The Supreme Court's dismissal of a special leave petition further reinforced this position. The Delhi High Court concurred with these decisions, affirming that 'bottles' and 'crates' indeed qualify as 'plant' under section 32(1)(ii) for depreciation purposes. Entitlement to Development Rebate: Drawing on the analogy from the Allahabad High Court's decision in CIT v. Swadeshi Cotton Mills Co. Ltd., the judgment also recognized the assessee's entitlement to development rebate on 'bottles' and 'crates'. This entitlement aligned with the classification of these assets as 'plant' for depreciation purposes. Relief under Section 80J: Regarding the relief under section 80J for the assessment year 1973-74, the judgment referred to the Supreme Court's decision in Lohia Machines Ltd. v. Union of India, which had implications against the assessee. Consequently, the court ruled against the assessee on this specific issue. In conclusion, the judgment favored the assessee on the classification of 'bottles' and 'crates' as 'plant' for depreciation and entitlement to development rebate. However, the relief under section 80J for the assessment year 1973-74 was denied based on the Supreme Court precedent.
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