2000 (11) TMI 119

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....d the Department's application for leave to appeal under section 260A. In our opinion, there are two main points (involving two sums) on which the Department sought to appeal. The first sum is Rs. 2,72,110. This sum represents the part of the insurance cover received by the assessee (the aggregate received being Rs. 74,28,849) which was in excess of the cost of fully damaged machinery. Th....

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....the balance of the sum of Rs. 16,63,000 and odd in its hands. The point was whether it could be taxed as a revenue receipt under section 41(2), as it stood at the material time. The said sub-section without the provisos is quoted below: "(2) Where any building, machinery, plant or furniture which is owned by the assessee and which was or has been used for the purposes of business or professi....

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.... Rs. 1.58 lakhs approximately for restoration of the building. The Supreme Court held that the balance of Rs. 7.03 lakhs approximately was not chargeable under section 41(2), because, according to the Supreme Court it could have no application to a case where the plant or machinery was merely damaged (and not destroyed), and by repairing, the damaged plant or machinery was restored to working cond....