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TMI Blog1991 (4) TMI 169X X X X Extracts X X X X X X X X Extracts X X X X ..... aking as per sub-section (2) of section 32A read with Explanation (a) to sub-section (1A) of section 35B of the Income-tax Act. The assessee claimed a deduction of Rs. 2,02,301 under section 35B of the Income-tax Act on the ground that it was a small scale industrial undertaking within the meaning of the aforesaid provisions of the Income-tax Act. The assessee pleaded before the assessing officer that the aggregate value of the machinery and plant (other than tools, jigs, dies and moulds) installed as on the last day of the previous year in question for the purposes of the business of the undertaking did not exceed Rs. 10,00,000. According to the assessee, the aggregate value of its plant and machinery as on the relevant date was only Rs. 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 32,072. If these two items are, in terms of the requirements of the Explanation below section 32A(2) to be excluded the machinery would only be Rs. 4,11,732 and even after the addition of the vehicles, the aggregate value of the appellant's machinery and plant would not exceed Rs. 10,00,000. It was pointed out that there is a separate item of moulds, patterns and dies amounting to Rs. 1,05,925.91 in this very balance sheet. The appellant's argument is that tools, in any case, are not included in this and the amount of moulds failing as part of the machinery is only Rs. 32,072. 2.1 I have carefully considered these arguments but I find that I am unable to accept them. A plain reading of the law, relevant portions of which have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the tools included in these machineries, I find that the basic proposition that a part of the machinery is to include the value of tools which should in turn should be excluded, difficult to accept. What is to be excluded is the value of tools as such and not tools forming part of plant and machinery for which there is no warrant or basis for computation. In these circumstances and for the reasons discussion, I would hold that the ITO was justified in denying the assessee the relief under section 35B." 4. In the context of the above findings of the learned CIT (A) a number of points were raised before us by the learned counsel for the assessee. The first point raised was to the effect that the cars and other vehicles could not have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its ambit. If any case law support is needed on the point, the same is available in the decision of the Supreme Court in the case of CIT v. Mir Mohammed Ali [1964] 53 ITR 165 wherein it had been observed that the expression ' installed ' does not necessarily mean ' fix in position ', but can also be used in the sense of ' inducting or introducing or placing an apparatus in position for service or use '. In this view of the matter, the two revenue authorities were not unjustified in including the value of vehicles in the aggregate value of plant and machinery for the purposes of sub-section (2) of section 32A. 6. The next point raised by the learned counsel for the assessee was that for the purpose of arriving at the market value of plant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onary at page 786 defines ' machine tools ' as a power-driven machine, as lathe, milling machine, drill, press, for shaping metal, wood or plastic material. Thus as per the dictionary meaning, a ' machine tool ' is essentially a ' machine ' and not a ' tool '. The Book produced by the learned counsel also purports to be a ' machinery guide ' and not ' tools guide '. The foreword to the said Book also clearly indicates that the Book is a machinery guide and contains information about machinery and its requirements. Every ' machine tool ' is an item of ' machinery '. The machinery is a word of common parlance and common usage and in that context it is used in a very wide sense. Moreover, a ' tool ' cannot produce anything or article, whereas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT (A), which reads as under : " 3. The second ground of appeal is that the ITO was not justified in disallowing an amount of Rs. 8,418 out of general expenses. The ITO has discussed these disallowances in paragraphs 7 to 9 of his order. The total disallowance is made up as under : (i) Out of Diwali, Dassera and other festival expenses. Rs. 2,316 (ii) 1/4th of expenses on dinners etc. Rs. 4,269 (ii) Out of Diwali Sweets to staff 10% Rs. 1,868 ------------------- Rs. 8,453 ------------------- The disallowance is actually Rs. 8,453 but mentioned as Rs. 8,418. In regard to Diwali etc. expenses, the ITO has relied on the judgment of the Bombay High Court in the case of Kolhapur Sugar Mills Ltd. v. CIT [1979] 119 ITR 387. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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