1996 (9) TMI 113 - HC - Income Tax

Summary

Issues: Interpretation of relevant rules for extra-shift allowance under Income-tax Rules, 1962.

The judgment by the High Court of Calcutta addressed the issue of whether certain machinery and plants, specifically data processing machines, central air-conditioning plants, and air-conditioners, are entitled to extra-shift allowance under the Income-tax Rules, 1962. The court examined Rule 5 of the Income-tax Rules, which allows an assessee to claim depreciation allowance on assets used for business or profession. The court referred to Part I of Appendix I to determine the eligibility for extra-shift allowance. The court highlighted that the provision for extra-shift allowance is subject to certain conditions, including not allowing it for machinery or plants marked with 'NESA' (No Extra Shift Allowance). The court noted that the intention of the Legislature is clear in disallowing extra-shift allowance for machinery with the 'NESA' inscription. The court emphasized that a specific provision overrides a general provision, and the Legislature explicitly excluded certain machinery from extra-shift allowance eligibility. The court criticized the Income-tax Appellate Tribunal's reasoning for allowing extra-shift allowance on the mentioned machinery, stating it was erroneous and contrary to the Income-tax Rules. The court concluded that the Tribunal's decision was unfounded as it disregarded the 'NESA' inscription and allowed extra-shift allowance based on its reasoning, contrary to the clear legislative intent. The court ruled in favor of the Revenue, denying the extra-shift allowance for the assessees in both references, and directed the transmission of the opinion to the Tribunal for appropriate action. Chief Justice V. N. Khare concurred with the judgment.