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TMI Blog1992 (1) TMI 58X X X X Extracts X X X X X X X X Extracts X X X X ..... e in accordance with a circular of the CBDT directing computation of extra shift allowance on the basis of the working of the concern as such without reference to the working of individual machinery ? " The assessee, in computing its income of the previous year ended March 31, 1978, corresponding to the assessment year 1978-79, took into account a sum of Rs. 3,97,573, being extra shift allowance on capitalised documentation fees. It was the assessee's contention that these drawings and designs were required to be consulted at every stage of the multiple working of the shifts and were, therefore, admissible to extra shift allowance. Reliance was placed upon a circular issued by the Central Board of Direct Taxes dated September 28, 1970 (Ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded the issue in favour of the assessee. The Income-tax Appellate Tribunal, following an order passed by its Bench at Ahmedabad in the case of ITO v. Anil Starch Products Ltd. [1983] 6 ITD 1, held that drawings and designs were not entitled to extra shift allowance. It will be seen that the question which we are required to answer is : are the drawings and designs entitled to extra shift allowance in accordance with or under the said circular. The said circular says that where a concern has worked double or triple shifts, extra shift allowance shall be allowed in respect of the entire plant and machinery used by the concern and no attempt need be made to determine the number of days on which each machine actually worked multiple shifts du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court. On behalf of the Revenue, reliance was placed upon a judgment of the Calcutta High Court in Anantapur Textiles Ltd. v. CIT [1979] 116 ITR 851. The question that arose for consideration there read thus (at page 851) : " Whether, on the facts and in the circumstances of the case, the Tribunal is right in holding that the extra shift allowance on machinery worked triple shift should be calculated with reference to the actual number of days each item of machinery had been put to use and not on the number of days the concern had worked in the previous year in view of section 32 of the Income-tax Act, 1961, and the Rules thereunder ? " Having regard to the manner in which the question posed to us has been framed, this judgment can gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowance " on all the machinery purchased by the assessee and set up in its business. The Income-tax Officer, the court held, was required to apply his mind to examine which machinery owned by the assessee had been used in the extra shift. So long as the particular machinery had worked the extra shift in the relevant year for the specific period, it would be eligible for extra shift allowance on the basis of the number of days, provided the words " NESA " did not apply thereto. For the purpose of this reference, we are concerned only with the terms of the said circular No. 109, dated March 20, 1973. It is that circular which is referred to specifically in the question. Upon an interpretation of that circular, we are left in no doubt abou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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