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Issues:
1. Jurisdiction of Commissioner to revise assessment under section 263 of the Income-tax Act, 1961. 2. Allowability of extra shift depreciation for a new manufacturing unit. 3. Equating the concern with the assessee. 4. Entitlement to extra shift allowance for a plant working for a limited period. Analysis: The judgment pertains to an assessment year involving a private limited company engaged in manufacturing chemicals. The Commissioner of Income-tax invoked revisional powers under section 263 of the Income-tax Act, 1961, to correct the extra shift allowance granted by the Income-tax Officer. The Commissioner held that the new manufacturing unit was entitled to a specific extra shift allowance based on the number of days it operated, differing from the initial assessment. The company appealed this decision before the Income-tax Appellate Tribunal, arguing that the new unit was part of the entire concern and worked double shifts throughout the year, contrary to the Revenue's stance that it was a separate entity. The Tribunal ruled in favor of the company, deeming the Commissioner's actions as legally flawed and allowing the appeal based on the concern operating double shifts consistently. The Tribunal referred several questions to the High Court for consideration, primarily focusing on the jurisdiction of the Commissioner, the interpretation of the concern as a whole, and the entitlement to extra shift allowance for the limited operation of the new plant. The High Court's decision relied significantly on a directive from the Central Board of Direct Taxes, stating that where a concern operates double or triple shifts, the extra shift allowance should apply to the entire plant and machinery without considering individual machine operations. Given that the new plant operated for a limited period and the old plant consistently worked double shifts, the High Court upheld the Tribunal's decision, affirming the company's entitlement to the extra shift allowance as claimed and allowed by the Income-tax Officer. In conclusion, the High Court answered the questions posed in favor of the company, emphasizing the applicability of the Board's directive in determining the entitlement to extra shift allowance. The judgment highlighted the importance of considering the concern as a whole and the consistent operation of double shifts in determining the allowance, ultimately supporting the company's position and rejecting the Revenue's contentions. The reference was answered accordingly, with the decision favoring the company, and no costs were awarded in the matter.
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