9911796707
TMI Blog1980 (2) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... facts and in the circumstances of the case, the Income-tax Appellate Tribunal is right in law in holding that in respect of the freezing and storage plant let out by the assessee, the assessee can claim development rebate under section 33(1)(b)(B)(i)(a) of the Income-tax Act, 1961 ? " The assessee is a registered firm dealing in sea foods with its head office in Cochin and branch at Bombay. The relevant assessment years concerned in these references are 1969-70 and 1970-71, for which the relative periods of account are the years that ended in March 31, 1969, and March 31, 1970, respectively. During the accounting year relevant to the assessment year 1969-70, the assessee put up a freezing, cold storage and ice plant at their Bombay br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment year 1970-71 came up first before the Tribunal for hearing and disposal. The Tribunal held that inasmuch as the ITO himself had proceeded on the basis that in letting out the plant and machinery the assessee was still doing business and the hire charges received had been assessed as business income in the hands of the assessee and it allowed development rebate to the assessee, though at a lower rate, the determination of the rate applicable had necessarily to be made on the basis that the plant and machinery were being used by the assessee for the purpose of the business carried on by him. Proceeding on the basis of this reasoning, the Tribunal further held that the plant and machinery in respect of which the development rebate w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity for the grant of development rebate and hence the Tribunal was not justified in holding that the assesses is entitled to the grant of development rebate at the rate of 35%. We see no substance in this contention. While making the assessments for both the years concerned, the ITO had proceeded on the explicit basis that despite the fact that the freezing plant, etc., in the Bombay branch of the assessee had been let out to sister concern, the said plant and machinery were none the less being used by the assessee for its business and had treated the income derived by the assessee by such letting as the business income of the assessee. He had also allowed the claim of the assessee for the grant of development rebate obviously only on the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on allowance in respect of a motor lorry. In respect of the assessment made for the year 1970-71 the Tribunal had before it only the appeal filed by the assessee, the contention taken therein as well as in the appeal filed by the assessee for the year 1969-70 being that the development rebate ought to have been allowed to it at the higher rate of 35%. Section 33(1)(b)(B) is the provision relied on by the assessee for claiming development rebate at the rate of 35%. That provision reads: "(b). The sum referred to in clause (a) shall be (A) in the case of a ship, forty per cent. of the actual cost thereof to the assessee; (B) in the case of machinery or plant, (i) where the machinery or plant is installed for the purposes of busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st day of April, 1970, and (b) fifteen per cent. of such cost, where it is installed after the 31st day of March, 1970." Admittedly, the machinery of plant with which we are concerned in this case had been installed by the assessee before the 1st day of April, 1970. It has also been found by the Tribunal that the said machinery or plant was installed for the purpose of the business of processing frozen fish and fish products, in other words, it is machinery or plant installed for the purpose of manufacture or production of " processed (including frozen) fish and fish products " which is the items specified as (30) of the list in the Fifth Schedule to the Act. Since the grant of development rebate to the assessee as per the orders pass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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