Enhanced depreciation for machinery failed where molasses ingredients were not treated as corrosive chemicals in sugar manufacture.

Enhanced depreciation on machinery was unavailable because the claim turned on whether the equipment had come into contact with corrosive chemicals within the relevant depreciation entry. The Court held that, even if certain elements were present in molasses used in sugar manufacture, they could not be treated as corrosive chemicals. As the requisite contact with corrosive chemicals was not established, the assessee was not entitled to depreciation at the higher rate of 15 per cent.

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Issues: Whether the assessee was entitled to depreciation at the higher rate of 15 per cent on the machinery on the footing that it came into contact with corrosive chemicals in the process of sugar manufacture.

Analysis: The claim for enhanced depreciation depended on whether the machinery could be regarded as having come into contact with corrosive chemicals within the meaning of the relevant depreciation entry. The Court held that even assuming certain elements were present in molasses, those substances could not be treated as corrosive chemicals, and therefore the requisite contact with corrosive chemicals was not established.

Conclusion: The assessee was not entitled to depreciation at 15 per cent on the machinery.

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