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TMI Blog1999 (6) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... ent. which are used in the assessee's own business ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the assessee-firm was entitled to investment allowance under section 32A of the Income-tax Act, 1961 ? (3) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law, in holding that the assessee was an industrial undertaking as contemplated under section 32A(2)(b)(iii) of the Income-tax Act for claiming investment allowance under section 32A(1) of the Act ? (4) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the assessee was entitled to investment allowance under section 32A(1) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tled to investment allowance under section 32A of the Income-tax Act. Then the Department approached the Tribunal for making a reference and, accordingly, the Tribunal has made this reference on the questions aforementioned. So far as question No. (2) quoted above is concerned, it is squarely covered by the Supreme Court decision in the case of CIT v. N. C. Budharaja and Co. [1993] 204 ITR 412, wherein it was held thus : "We are, therefore, of the opinion that sub-clause (iii) of clause (b) of sub-section (2) of section 32A does not comprehend within its ambit construction of a dam, a bridge, a building, a road, a canal and other similar constructions." Therefore, this question is answered in favour of the Revenue in view of the decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not binding on this court. This court can examine the matter independently and come to its own conclusion. More so, in the present case, as an interpretation of statutory provision is involved. Therefore the earlier finding of fact given in the case of an assessee will have no bearing. We have to interpret the provisions of Entry No. III(ii)E(1A) of Part I of Appendix I appended to the Income-tax Rules, 1962, which reads as under : "(1A) Motor buses, motor lorries and motor taxis used in a business of running them on hire (N. E. S. A)-40 per cent." A plain reading of this provision shows that the assessee is only entitled to a depreciation at the rate of 40 per cent. on vehicles used for business of hire, i.e., if the assessee gives o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Karnataka High Court has also taken the same view in the case of Veeneer Mills v. CIT [1993] 201 ITR 764, wherein the assessee was a manufacturer of plywood and used to transport the timber which is the raw material in the manufacture of plywood through its own lorries. The dominant purpose of these lorries was the transportation of the material belonging to the assessee in connection with its manufacturing work. However, on some occasions, when the lorries were idle, they were given on hire. In this case, their Lordships observed that the facts speak for themselves. The provision is only attracted in the case of motor buses, motor lorries and motor taxis used in a business of running them on hire. The assessee should be engaged in th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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