1995 (3) TMI 12

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....treating the medical expenses of Rs. 1,506 as perquisite and disallowing the same ? (ii) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in rejecting the assessee's claim of depreciation at 15 per cent. on the machinery which came into contact with corrosive chemicals ? " We take up question No. (ii) first. The assessee, Gwalior Sugar Co. Ltd., Dabra, claimed depreciation at the rate of 15 per cent. on the machinery on the ground that in the process it came into contact with corrosive chemicals and, therefore, the higher rate of depreciation of 15 per cent. should be allowed to it. This claim has been repelled by the Tribunal. On an application being made by the assessee. Therefore, at the ins....

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.... Tribunal was right in law in rejecting the assessee's claim for depreciation at the rate of 15 per cent. on the machinery in question. Coming to the question No. (i), the claim relates to medical expenses of Rs. 1,506 for the assessment year 1974-75 and Rs. 4,768 for the assessment year 1977-78, which has been included in perquisites of the managing director's remuneration, and has not been allowed as expenses incurred by the assessee-company. Section 17(2) of the Act speaks of perquisite, which includes a number of items, of which clause (v) for the purposes of the present reference is relevant, which reads as under : " (v) any sum payable by the employer, whether directly or through a fund, other than a recognised provident fund....

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....to any allowance in respect of any assets of the assessee used by an employee either wholly or partly for his own purposes or benefit, then, subject to the provisions of clause (b), so much of such expenditure or allowance as is in excess of the limit specified in respect thereof in clause (c) shall not be allowed as a deduction : Provided that where the assessee is a company, so much of the aggregate of-- (a) the expenditure and allowance referred to in sub-clauses (i) and (ii) of this clause ; and (b) the expenditure and allowance referred to in sub-clauses (i) and (ii) of clause (c) of section 40, in respect of an employee or a former employee, being a director or a person who has a substantial interest in the company or a relat....