Diesel generator treated as machinery, not electrical machinery, and allowed triple-shift depreciation under income tax rules.

A diesel-run generator used in business was treated as machinery eligible for depreciation under section 32(1) of the Income-tax Act, 1961. The decisive test was whether it was electrically operated with an in-built motor; a generator that merely produces electricity, and is not itself operated by electricity, does not fall within "electrical machinery". On that basis, the generator was held not to be electrical machinery and was entitled to triple-shift allowance.

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Issues: Whether a diesel-run generator used in the assessee's business qualified as "electrical machinery" so as to be denied triple-shift allowance under the depreciation schedule.

Analysis: Depreciation under section 32(1) of the Income-tax Act, 1961 is available for machinery owned and used for business purposes. The decisive test was whether the machinery was electrically operated with an in-built motor. A generator that merely produces electricity, but is not itself operated by electricity and has no in-built motor, does not fall within the expression "electrical machinery".

Conclusion: The generator was not electrical machinery and was entitled to triple-shift allowance. The question was answered in favour of the assessee and against the Revenue.

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