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TMI Blog1992 (9) TMI 117X X X X Extracts X X X X X X X X Extracts X X X X ..... 3) of the Act. The Income-tax Officer had accepted the assessee's claim for depreciation on gas cylinder @ 100 per cent. The Commissioner initiated action u/s. 263 of the Act on the ground that the Income-tax Officer was wrong in allowing the assessee's claim for depreciation at 100 per cent on the item of machinery described as "LPG Gas tank cylinder". He was of the view that gas cylinders are portable articles, whereas what the assessee has installed in the factory was gas storage tank which was a permanent installation on which the special rate of depreciation at 20 per cent of the cost was allowable and that in so far as the Income-tax Officer had accepted the assessee's claim for depreciation @ 100 per cent, the assessment was erroneou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 per cent depreciation should be allowed. 4. Before the CIT, the assessee had raised an alternative argument that if 100 per cent depreciation is not allowed, the ITO should be directed to allow extra-shift depreciation and also investment allowance u/s. 32A on the LPG Gas cylinder. This alternative contention was directed by the CIT to be considered by the ITO while giving effect to the order passed u/s. 263 of the Act. 5. The assessee in appeal before us, contended that the CIT erred in assuming that gas cylinder should be portable in order to be entitled to depreciation @ 100 per cent. It was further pointed out that the CIT erred in his conclusion that the storage tank containing gas was a permanent concrete installation. It was po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mediately previous item (4) granted depreciation @ 100 per cent on "gas cylinder including valves and regulators". According to the Ld. DR. item C-5 and item F-5 together exhaust the depreciation allowable in respect of the entire plant and machinery installed in glass manufacturing concern. According to him, only direct fire glass melting furnace gets depreciation at 100 per cent. The cylinder owned by the assessee-company forms part of the machinery installed in the assessee's glass manufacturing concern and this was eligible for depreciation only @ 20 per cent under item C-5. He therefore submitted that the CIT's order should be upheld. 7. We have carefully considered the rival submissions. We have also gone through the Paper Book file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bed is 15 per cent. There are certain other items of machinery, which are eligible for the special rate of depreciation. All the items of machinery for which special rates are prescribed are mentioned in sub-head A to F. Item F-5, prescribes a special rate of 100 per cent depreciation for direct fire glass melting furnaces which have been excluded from the entry which prescribes a special rate of 20 per cent. Therefore, the only effect of items C-5 and F-5, read together, is that these two items exhaust the different types of melting furnaces installed in a glass manufacturing concern. It is not correct to suggest that these two entries exhaust the entire items of machinery installed in a glass manufacturing concern. The words used in these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n be removed. The concrete columns, merely support the storage tank. The fact that the storage tank is very big with the capacity of 30 M.T. does not militate against the assessee's claim that it is a gas cylinder. In the Concise Oxford Dictionary, the word "cylinder" is defined as "uniform solid or hollow body with straight sides and a circular section: a thing of this shape e.g. a container for liquified gas". The requirement of the entry is that it should be of a cylindrical shape and there is no requirement that the cylinder should be small in size or portable. 8. For these reasons, we uphold the contention of the assessee and hold that the LPG gas tank cylinder installed by it during the previous year is eligible for depreciation at ..... X X X X Extracts X X X X X X X X Extracts X X X X
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