9911796707
|
Home
Issues:
Assessment under section 263 - Extra shift allowance, Investment allowance, Deduction under section 80-I. Analysis: The appeal was against the CIT's order under section 263 of the Income-tax Act, 1961 for the assessment year 1984-85. The CIT identified three errors in the assessment: (i) wrongly allowed extra shift allowance on data processing machine, (ii) wrongly allowed investment allowance on computers/data processing machines under Eleventh Schedule, and (iii) wrongly allowed deduction under section 80-I for manufacturing data processing machines and computers. The Tribunal considered the arguments regarding extra shift allowance, where the CIT contended it was not allowable, but the Tribunal followed precedent and allowed it. Regarding investment allowance and section 80-I deduction, the Tribunal analyzed if the assessee was manufacturing items specified in the Eleventh Schedule. The Eleventh Schedule includes 'office machines and apparatus' like typewriters, calculating machines, etc. The Tribunal examined if data processing machines and computers fall under this category. The Tribunal considered the interpretation of the Eleventh Schedule and the Explanation provided. The assessee argued that the Explanation cannot extend the main provision and relied on various legal precedents to support this argument. The Departmental Representative contended that computers are listed under entry 22 of the Eleventh Schedule, thus disqualifying the assessee from claiming investment allowance and section 80-I deduction. The Tribunal analyzed the purpose of the Eleventh Schedule, which lists luxury items not eligible for certain deductions, and deliberated on the nature of computers in the modern context. The Tribunal referred to legal principles such as the dictum 'noscitur a sociis' to interpret the Eleventh Schedule. It explained that when specific items are listed, general words should be construed within the same kind and class. The Tribunal concluded that data processing machines do not fall under the category of office machines and apparatus listed in the Eleventh Schedule. Therefore, the assessee was entitled to claim investment allowance and section 80-I deduction. The Tribunal held that there was no error in the Assessing Officer's order, and the conditions for invoking section 263 jurisdiction were not met in this case. Consequently, the appeal of the assessee was allowed.
|
