9911796707
TMI Blog1981 (7) TMI 107X X X X Extracts X X X X X X X X Extracts X X X X ..... these machineries were purchased after 31st May, 1974. The machineries consisted of Induction Hardening Equipment, Elephiac Hacksaw blades costing Rs. 4,59,285 and Tooth point Hardening Equipment costing Rs. 8,74,113. The assessee's submission was that these machineries fell under the category of machine tools mentioned in the 9th Schedule to the IT Act, 1961. The ITO held that a machine tool is a self-contained unit capable of independent operation. Hacksaw and Bandsaw blads manufactured by the assessee are not capable of independent operation and therefore, the machinery purchased by the assessee would not qualify for deduction under s. 32(1)(vi). The alternative claim for development rebate was rejected on the ground that the contract wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessary power for working the machine tools is supplied from outside either mechanically or through an electric motor etc. If the interpretation placed by revenue on machine tools were to be accepted, a large number of machine tools regarded as such in industry would not be considered as machine tools at all. We, therefore, hold that the assessee is entitled to initial depreciation on the machineries of the value of Rs. 13,27,398. The order of the CIT (A) in this behalf is set aside and the assessee's ground succeeds. In the view that we have taken, it is not necessary for us to consider the alternative contention regarding allowance of development rebate. 5. The second ground is about the disallowance of motor car expenses. The ITO disal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntended before us that the expenditure of Rs. 3,000 was incurred in connection with consultation on taxation matters. The ld. counsel for the assessee stated that s. 80VV is restricted to the expenditure incurred in respect of any proceedings before the IT authorities etc. The proceedings start with the filing of the return. The expenditure on consultation incurred by an assessee does not become part of the proceedings. In fact, it is an expenditure incurred prior to the commencement of the proceedings. Thus the limitation imposed by s. 80VV does not apply to expenditure incurred on consultation. Such an expenditure being incidental to the carrying on of business, it was urged, should be allowed under s. 37 of the IT Act. The ld. Deptl. Rep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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