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TMI Blog1977 (3) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... in the cost of Russian machinery on account of the devaluation of Indian currency. The assessee's claim was based on the fact that its actual cost of the said machinery had increased consequent on the increase in the rate of exchange on the devaluation as they were acquired before the date of devaluation. The Income-tax Officer negatived the assessee's claim in view of the express provisions of section 43A(2) of the Income-tax Act, 1961, which according to him clearly prohibited the changes in actual cost for the purpose of granting development rebate under section 33. In that view of the matter, he reworked the computation for development rebate and arrived at a development rebate of Rs. 2,53,346. The Appellate Assistant Commissioner to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar 1967-68 ? " For the purpose of answering this question, a reference has to be made only to four statutory provisions. It is section 33 of the Income-tax Act, 1961, which deals with the grant of development rebate. That section provides for the grant of development rebate to the assessee in respect of new machinery or plant acquired by the assessee and wholly used for the purpose of the business carried on by him of a particular percentage of the actual cost of the machinery. Section 43 of the Act defines certain terms relevant to income from profits and gains of business or profession and states that the expression " actual cost " in sections 28 to 41 and in section 43, unless the context otherwise requires, meant the actual cost of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contemplate in section 43(1). That was also the case before us. Pursuant to section 33, the assessee will be entitled to development rebate on the actual cost as defined in section 43(1) which, admittedly, included this sum of Rs. 48,342. In view of this obvious position, having regard to the express provisions contained in section 43A(2), it is rather difficult to appreciate as to how the department contended before the Tribunal that the actual cost should not be computed as provided for in section 43(1). Under these circumstances, we answer the question referred to this court in the affirmative and in favour of the assessee. The assessee is entitled to its costs of this reference. Counsel's fee Rs. 500. X X X X Extracts X X X X X X X X Extracts X X X X
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