Functional test for plant treats tile-drying sheds as part of manufacturing plant, supporting investment allowance eligibility.

Sheds specially constructed for drying tiles in the manufacturing process were treated as part of the plant, because tile drying was an essential and integral manufacturing step. On that functional basis, the sheds were regarded as plant and machinery rather than a mere building structure, entitling the assessee to investment allowance.

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Issues: Whether sheds used for drying tiles in the manufacturing process constituted "plant" so as to entitle the assessee to investment allowance.

Analysis: The drying of tiles was held to be an essential step in the manufacture of tiles. Sheds specially constructed for drying the tiles were treated as an integral part of the manufacturing process and, on that functional basis, formed part of plant and machinery rather than mere building structure.

Conclusion: The sheds used for drying tiles were held to be plant, and the assessee was entitled to investment allowance.

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