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TMI Blog2003 (4) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... e did not amount to manufacture or production of article or thing?" - we answer all the above three questions in the affirmative, i.e., in favour of the Department and against the assessee. - Income-Tax Appeal No. 247 of 2001 - - - Dated:- 16-4-2003 - Judge(s) : S. H. KAPADIA., J. P. DEVADHAR. JUDGMENT The judgment of the court was delivered by S.H. KAPADIA J.-The short question which arises for determination in this appeal is : whether the assessee was entitled to deduction of investment allowance on the CT scan machine installed and used by the assessee during the accounting year ending on March 31, 1990, relevant to the assessment year 1990-91. Facts: The assessee is a company incorporated on January 31, 1989. Its main obje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come by way of appeal under section 260A of the Income-tax Act with the following questions: "(a) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the appellant was not entitled to deduction of investment allowance of Rs. 16,77,837 on the CT scan machine installed and used by the appellant during the year under consideration? (b) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the diagnostic centre run by the appellant was not an industrial undertaking? (c) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that generating reports from the CT scan machine did n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 32A are satisfied in this case? On the facts, the Tribunal has found that the CT scan machine has been installed in a diagnostic centre which is not an industrial undertaking and, therefore, the assessee was not entitled to deduction of investment allowance. It has been argued on behalf of the assessee that the diagnostic centre is business activity and, therefore, it is an industrial undertaking. Hence, the assessee was entitled to claim deduction under section 32A of the Act. We do not find any merit in this argument. Firstly, as stated above, sub-section (1) of section 32A requires that the plant or machinery should be owned by the assessee; that it should be used for the purpose of business carried on by the assessee and that s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t allowance on the CT scan machine installed and used by the assessee during the year under consideration. In the case of Fariyas Hotels Pvt. Ltd. v. CIT [1995] 211 ITR 390, the Bombay High Court has laid down a test to attract section 32A of the Income-tax Act. In that judgment, it has been held that deduction on account of investment allowance is admissible only in respect of plant or machinery specified in section 32A(2). That, investment allowance is available only in respect of machinery which is used for the purpose of manufacture of articles or things and it is not available in respect of machinery installed for the purpose of the business of the assessee which does not fall within the specification contained in section 32A(2). In th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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