Hospital furniture is not a welfare centre asset for higher depreciation under the Income-tax Rules.

Furniture and fittings used in a hospital do not qualify as items used in a "welfare centre" under Appendix I, Part I(2) of the Income-tax Rules, 1962. The higher depreciation rate of 15% applies only to specified categories of user, while furniture and fittings not covered by that item fall under the general 10% rate in Appendix I, Part I(1). Because "welfare centre" is not defined in the Rules, it must be given its ordinary meaning, and a hospital is not commonly understood as a centre for community welfare within that expression. The applicable depreciation on the furniture and fittings was therefore 10%.

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Issues: Whether furniture and fittings used in a hospital fall within the expression "welfare centres" in Appendix I, Part I(2) of the Income-tax Rules, 1962 so as to qualify for depreciation at 15 per cent.

Analysis: The higher depreciation rate under Appendix I, Part I(2) applies to specified categories of user, including welfare centres, while furniture and fittings not covered by that item attract depreciation at 10 per cent under Appendix I, Part I(1). The expression "welfare centre" was not defined, so it had to be understood in its ordinary and commonly accepted sense. Applying that approach, a hospital is a place for treatment and care of the sick and is not commonly understood as a centre for community welfare in the sense contemplated by the rule.

Conclusion: A hospital does not fall within the term "welfare centre" in Appendix I, Part I(2) of the Income-tax Rules, 1962, and the assessee was entitled only to depreciation at 10 per cent. on the furniture and fittings.

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