Depreciation on brick-kiln structures upheld for plant and temporary structure treatment; tool depreciation remitted for fresh examination.

Depreciation was upheld on a chimney used in brick manufacture because it was treated as plant and machinery, and on a temporary hutment because it qualified for full depreciation as a temporary structure. The Tribunal relied on the first appellate authority's reasoning and an earlier decision on similar facts. Depreciation on tools was remitted to the Assessing Officer because no effective arguments were advanced and the appellate order gave no specific basis for allowing the claim, requiring fresh examination of whether the tools were consumable articles.

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Issues: (i) Whether depreciation was allowable on Chimni and Jhuggi Jhopari. (ii) Whether the issue of depreciation on tools required restoration to the Assessing Officer.

Issue (i): Whether depreciation was allowable on Chimni and Jhuggi Jhopari.

Analysis: Chimni was found to be necessary for the manufacture of bricks and was treated as plant and machinery. Jhuggi Jhopari was treated as a temporary structure eligible for 100 per cent depreciation. The conclusion was supported by the reasoning adopted by the first appellate authority and the view taken in an earlier Tribunal decision on similar facts.

Conclusion: Depreciation on Chimni and Jhuggi Jhopari was upheld in favour of the assessee.

Issue (ii): Whether the issue of depreciation on tools required restoration to the Assessing Officer.

Analysis: No effective arguments were advanced on the tools, and there was no specific reasoning in the appellate order explaining why depreciation had been allowed. The matter required fresh examination, including whether the tools were in the nature of consumable articles.

Conclusion: The question of depreciation on tools was restored to the Assessing Officer.

Final Conclusion: The revenue's challenge succeeded only in part, with depreciation on Chimni and Jhuggi Jhopari sustained and the issue relating to tools remitted for reconsideration.

Ratio Decidendi: A kiln used in brick manufacture may be treated as plant and machinery for depreciation, and a temporary hutment may qualify for full depreciation as a temporary structure; where no reasoned basis exists for allowing depreciation on tools, the matter may be remitted for fresh examination.

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