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TMI Blog1968 (4) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... ineries for air-conditioning was Rs. 2,31,279. The assessee in its return claimed both depreciation and also development rebate in respect thereof. The income returned by the assessee was under the three heads, interest, business and property. In a part of the premises of an extent of 1,300 sq. ft., there were two tenants, one the Airlines Corporation Ltd., and the other the Standard Vacuum Oil Company Limited, both of which were, under the terms of the tenancy, entitled to air-condition facilities. The claim for development rebate was disallowed by the Income-tax Officer with whom the Appellate Assistant Commissioner of Income-tax agreed, on the ground that the assessee had let out portions of the premises and that, therefore, the air-cond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. of the actual cost of such machinery or plant to the assessee. The proviso to this provision is to the effect that allowance should not be granted unless the particulars prescribed for the purpose of section 10(2)(vi) have been furnished by the assessee in respect of such machinery. Clause (vi) has reference to allowance in respect of depreciation of machinery or plant among other things. For the revenue the approach is that the conditions for allowance of development rebate ought to be strictly complied with, that unless the words employed by the' legislature for the purpose are squarely met by facts on which the claim for rebate is founded, no allowance can be made and that, therefore, there is no room for extraneous considerations lik ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal accepted this proposition. At any rate, it is not clear from its order what precisely its view was on this aspect. The Banking Companies Act, 1949, defines " banking " as the accepting, for the purpose of lending or investment, of deposits of money from the public, repayable on demand or otherwise and withdrawals by cheques, draft, order or otherwise. Part II of the Act deals with business of banking companies and section 6 is concerned with forms of business in which banking companies may engage. Clause (i) of sub-section (1) of section 6 resembles, as we mentioned, the clause referred to in the memorandum of association of the assessee. An examination of sub-section (1) shows that the forms of business contemplated therein ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , such income will not be treated as income from business, but only from property. Would it make any difference if instead of the assessee using it, it lets out and derives income ; can its character be anything different from income from property ? We can conceive of no proper reason to think that it would for purposes of income taxation. Section 9(1) in fact makes this view quite plausible. That section shows that income from property is chargeable to tax under that head on the basis of the annual letting value of the property whether it is owneroccupied or tenanted. The head of income " profits and gains of business, profession or vocation " is separately dealt with in section 10 in contrast with section 9 dealing with " property income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttractive to take the view that the principle of de minimis non curat lex could be applied. Having regard to the total extent of the floor space of the premises which was huge, the portion that was let out to two tenants was comparatively negligible, the space let out working out to about 3 per cent. of the total area. Another view may be, why not construe the word " wholly " in a substantial sense or from the standpoint of the principle that the law takes no notice of trifles. Commissioner of Income-tax v. Ouchterlony Valley Estaes made a third approach, which, on facts, appears to be even a stronger case for the revenue. That was a case of an assessee who cultivated tea and coffee, using the assets for the cultivation of both, and claimed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... development rebate can be claimed. If that were the position, we fail to understand the significance of the word " wholly ". It does not mean wholly but qualified by circumstances. Obviously, when the machinery or plant is used for business, what is contemplated is, it would be used wholly for the purpose to the extent such user was made. " Wholly " has no reference to the extent or nature of the business but to the extent of the user ; but such user must be with reference to and only for the purposes of the business carried on by the assessee. We have carefully considered whether the doctrine of substantial compliance or the principle of de minimis non curat lex could be invoked in the application of section 10(2)(vib). Rowlatt J. in Cap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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