Plant classification for depreciation turns on whether a building is an integral part of the production system.

Whether an assessee's building, or any part of it, qualified as plant for investment allowance and depreciation depended on the factual distinction between a mere convenient business facility and a structure that formed an integral part of the plant and machinery. The HC held that this issue had to be tested against the governing Supreme Court principle on whether the building was part of the generation or production system. The matter was restored to the Tribunal for fresh consideration and for a finding on whether the whole building or any identifiable part of it satisfied that test.

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Issues: Whether the assessee's building, or any part of it, constituted plant for the purpose of investment allowance and depreciation.

Analysis: The dispute turned on whether the structure was merely a convenient facility for carrying on the business or was an integral part of the plant and machinery. In that context, the applicable principle required examination of the factual finding in the light of the distinction drawn between a helpful structure and a building forming part of the generation or production system.

Outcome: The matter was restored to the Tribunal for fresh consideration, with a direction to examine whether the entire building or any part of it qualified for investment allowance and depreciation in the light of the governing Supreme Court decision.

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