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TMI Blog1978 (1) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... and plant worked for a period of 180 days or more and accordingly the plant and laboratory equipments are entitled to only a proportion of the actual allowance ? 2. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was legally justified in holding that the sum of Rs. 2,85,733 formed part of the actual cost of the assets of the assessee and accordingly entitled to depreciation and development rebate on such actual cost ? " The second question, learned counsel for both the parties are agreed, is covered by the decision of the Supreme Court in Challapalli Sugars Ltd. v. CIT [1975] 98 ITR 167. The figure of Rs. 2,85,733 mentioned in question No. 2 represented interest paid by the company for moneys borrowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee and also the laboratory equipment worked for a period of 112 days during the previous year, the normal depreciation allowance would be only 50% of the full depreciation allowance as per rule 5. Therefore, the double shift allowance has to be calculated with reference to 50% of such normal allowance i.e., 50% of the full depreciation allowance. Fifty per cent. of the full depreciation allowance comes to Rs. 9,61,635 in the case of plant and machinery and Rs. 583 in the case of laboratory equipment. The ITO was, therefore, correct in calculating the double shift allowance with reference to 50% of the above figures as per the provisions of Part I of Appendix I to the Income-tax Rules, 1962. The Appellate Assistant Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowed. The Explanation seeks to give an artificial meaning to the phrase " normal allowance " for the purpose of calculating the extra allowance for double or triple shift working. This is clear from the opening clause of the Explanation, namely, " for this pur- pose ". This view is strengthened by the phrase " that would have been allowed under rule 5 if the machinery or plant had been used during the previous year for a period of 180 days or more ". This points to the conclusion that for purposes of calculation of extra allowance, the normal allowance has to be the full depreciation allowance admissible on the footing that the company had worked for 180 days or more, irrespective of the number of days for which it had actually worked. We ..... X X X X Extracts X X X X X X X X Extracts X X X X
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