New machinery status denied for reconditioned equipment, so initial and extra depreciation claims under income tax law fail.

Whether reconditioned Jackstone Junior Frosters qualify as "new" for initial and extra depreciation under Sections 10(2)(vi) and 10(2)(via) was examined by applying the statutory meaning of "new" as something made or brought into existence for the first time. Suppliers' admissions of prior use and reconditioning (dismantling, renewal of worn parts, reassembly) left the machines with their original identity; reconditioning making them "virtually as new" does not amount to manufacture for the first time. Outcome: the machines are not "new" and the claim for initial and extra depreciations is rejected.

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Issues: Whether the machines (reconditioned Jackstone Junior Frosters) are "new" so as to entitle the assessee to initial and extra depreciations under Section 10(2)(vi) and Section 10(2)(via) of the Income-tax Act, 1961.

Analysis: The suppliers consistently described the machines as reconditioned, admitted they had been previously in use, and stated that they had been stripped, worn parts renewed and reassembled with modifications before sale; they stopped short of describing them as new. The statutory word "new" is undefined; in the context of machinery it denotes something made or brought into existence for the first time (as opposed to "used"). Though reconditioning may render a machine "virtually as new" and justify a manufacturer's guarantee, the machines retained their original identity and had been previously used. The fact of dismantling and renewal of parts does not convert previously used machines into machines made for the first time.

Conclusion: The machines are not "new" within the meaning of Section 10(2)(vi) and Section 10(2)(via) of the Income-tax Act, 1961; the claim for initial and extra depreciations is rejected.

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