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TMI Blog2002 (7) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... st the judgment and order of this court in Civil Rule No. 14(M) of 1988, the Revenue has formulated the following question of law and referred the same to this court for decision: "Whether, on the facts and in the circumstances of the case, the Tribunal is correct in law in allowing investment allowance on ultrasound medical diagnostic electrical equipment, air-conditioner and servo voltage stabilizer?" The assessee, Dr. M. L. Agarwalla, is a qualified radiologist engaged in the business of x-ray diagnosis since the assessment year 1981-82. For the assessment year 1989-90, the assessee claimed deduction under section 32A of the Income-tax Act, 1961, in respect of plant and machinery purchased and installed by him in the aforesaid busin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decision in CIT v. Shaw Wallace and Co. Ltd. [1993] 201 ITR 17 (Cal) and CIT v. Dr. V. K. Ramachandran [1981] 128 ITR 727 (Mad), held that the photographs of various parts of the body obtained by these machines are the resultant product of "work and activities". They are the result of the efforts and activities giving in black and white the internal position of different parts of the body for proper and efficient diagnosis. The exercise undertaken with the help of these machines for appropriate diagnosis is the effort or activity which in turn can be said to be the "thing" produced within the meaning of section 32A of the Act. The installation of the ultrasound diagnostic machine, in the opinion of the High Court, was for the purpose o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h reference to a decision of this court in CIT v. Down Town Hospital Ltd. [2001] 251 ITR 683. In that case the assessee claimed deduction under sections 80HH and 80-I in respect of the entire hospital. The court held that in the absence of a clear finding to show that a new article or thing is manufactured or produced out of some raw materials, it is difficult to hold that the assessee, Down Town Hospital, is an industrial undertaking. This decision in our opinion is not applicable in the instant case. The assessee claimed investment allowance as per the provisions of section 32A(2) for the ultrasound medical diagnostic electrical equipment, air-conditioner and servo voltage stabilizer and not for the entire establishment. The decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was whether the activity and the use of aircraft radio in the aforesaid business would fall within the purview of the expression "manufacture" or " production" and whether the ultimate photography which came to be produced as a result of such activity was covered by the expression "article" or "thing". The Calcutta High Court relying on the decisions in Trinity Hospital's case [1997] 225 ITR 178 (Raj) and in CIT v. Upasana Hospital [1997] 225 ITR 845 (Ker) answered the question in favour of the assessee. Similarly, in CIT v. Dr. L. C. Mitra [1998] 234 ITR 805, the Patna High Court held that investment allowance in respect of parts of x-ray machine is permissible under section 32A of the Act. The decision was rendered in consonance with the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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