2001 (3) TMI 46

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....ed in law in holding that development rebate was allowable even on the items of plant and machinery costing less than Rs. 750?" The factual position in a nutshell is as follows: The assessee a public limited company claimed deduction under the first proviso to section 32(1)(ii) in respect of items of plant and machinery costing less than Rs. 750 each, while computing its total income. The assessee also claimed development rebate in respect of such new items of plant and machinery. The Income-tax Officer (in short "the ITO"), held that the development rebate could not be allowed in respect of plant and machinery whose total value has been allowed to be written off under the proviso to section 32(1)(ii). The matter was carried in appeal be....

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....spect of depreciation...  (ii) in the case of buildings, machinery, plant, or furniture, other than ships covered by clause (i) such percentage on the written down value thereof as may in any case or class of cases be prescribed: Provided that where the actual cost of any machinery or plant does not exceed seven hundred and fifty rupees, the actual cost thereof shall be allowed as a deduction in respect of the previous year in which such machinery or plant is first put to use by the assessee for the purposes of his business or profession." "33. Development rebate.--(1)(b) The sum referred to in clause (a) shall be (A) in the case of a ship, forty per cent. of the actual cost thereof to the assessee; (B) in the case of machi....

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....cent. of the actual cost of the machinery or plant to the assessee, where it is installed before the 1st day of April, 1970, and (b) fifteen per cent. of such cost, where it is installed after the 31st day of March, 1970. (1A) (a) An assessee who, after the 31st day of March, 1964, acquires A any ship which before the date of acquisition by him was used by any other person shall, subject to the provisions of section 34, also be allowed as a deduction a sum by way of development rebate at such rate or rates as may be prescribed, provided that the following conditions are fulfilled, namely:-- (i) such ship was not previous to the date of such acquisition owned at any time by any person resident in India; (ii) such ship is wholly u....