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of <h1>Specially equipped nursing home building treated as 'plant' for 10% depreciation after functional test; appeal dismissed.</h1> The dominant issue was whether a nursing home building used by a medical practitioner qualifies as 'plant' so as to attract depreciation at 10%. Applying ... Depreciation - medical practitioner runs a nursing home - Whether, the assessee is entitled to depreciation at 10 per cent. on the nursing home building on the ground that it is a 'plant' ? - Assessee is a medical practitioner. He runs a nursing home. in respect of the building in which the nursing home is run, the assessee claimed, for the assessment year 1983-84, that it was a 'plant'. - HELD THAT:- The most apposite decision in this context is that delivered by the Allahabad High Court in S. K. Tulsi and Sons v. CIT [1990 (9) TMI 68 - ALLAHABAD HIGH COURT]. Reference was made to an earlier judgment, where also the functional test approved by this court in several decisions was applied. It was held that if it was found that the building or structure constituted an apparatus or a tool of the taxpayer by means of which business activities were carried on, it amounted to a 'plant' ; but where the structure played no part in the carrying on of those activities but merely constituted a place wherein they were carried on, the building could not be regarded as a plant. We find from the order of the Tribunal as also the assessment order that the assessees nursing home is equipped to enable the sterilisation of surgical instruments and bandages to be carried on. It is reasonable to assume in the circumstances, particularly having regard to the Tribunal's order which states that the sterilisation room covers about 250 sq. ft. that the nursing home is also equipped with an operation theatre. In the circumstance, we think that the finding of the High Court should be accepted. We would, however, add that in a case such as this, the Tribunal should proceed upon material placed by the assessee which establishes that the building is specially equipped as a plant for the assessee's business. The appeal is dismissed. The Supreme Court upheld the decision that a nursing home building can be considered a 'plant' for depreciation purposes if equipped for business activities like treating patients. The functional test was applied, and the appeal was dismissed. (Case citation: 1999 (2) TMI 11)
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