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TMI Blog1978 (1) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... the ITO giving effect to the directions given by the AAC is maintainable ?" The facts relevant for answering the questions are these : The assessee, Warner Hindustan Ltd., Hyderabad, is a public limited company carrying on business of manufacturing pharmaceuticals. The relevant assessment years are 1968-69 and 1969-70. The assessee spent a sum of Rs. 1,26,254 for digging a well in its factory and it was admittedly for the purpose of carrying on its business. The ITO disallowed the assessee's claim for depreciation and development rebate on the sole ground that the well did not come within the expression "plant". The AAC accepted the claim of the assessee and granted the rebate. The revenue carried that order in appeal contending that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wn value thereof as may in any case or class of cases be prescribed ........" Section 43(3) defines "plant" which "includes ships, vehicles, books, scientific apparatus and surgical equipment used for the purposes of the business or profession". Mr. P. R. Ramachandra Rao, appearing for the assessee, submits that the definition of "plant" is an inclusive definition of wide amplitude taking within its ambit even a well, provided that the well was dug for the purpose of carrying on the business of the factory. According to Mr. Ramachandra Rao, the assessee had to dig a well in the factory premises and instal a pumping set for pumping water to the factory as there was no adequate supply of water by the Corporation to the factory. It is his c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . J., speaking for the court, observed : "The correctness of the test laid down in this case is doubted in a later decision of the Gujarat High Court in the case of Commissioner of Income-tax v. Elecon Engineering Co. Ltd. [1974] 96 ITR 672, 697; the decision of the Bombay High Court in Jayasingrao's case [1962] 46 ITR 1160 is referred to and it is observed that this decision is not in accord with the trend of later decisions. In the first place, the primary meaning it assigned to the word "plant" is too narrow and constricted, that it must be an article having connection with mechanical or industrial business or manufacture of finished goods from raw products. Secondly, even the extended meaning of the word "plant" was there confined mer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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