1981 (7) TMI 107

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....Rs. 2,65,480. According to the ITO, these machineries were purchased after 31st May, 1974. The machineries consisted of Induction Hardening Equipment, Elephiac Hacksaw blades costing Rs. 4,59,285 and Tooth point Hardening Equipment costing Rs. 8,74,113. The assessee's submission was that these machineries fell under the category of machine tools mentioned in the 9th Schedule to the IT Act, 1961. The ITO held that a machine tool is a self-contained unit capable of independent operation. Hacksaw and Bandsaw blads manufactured by the assessee are not capable of independent operation and therefore, the machinery purchased by the assessee would not qualify for deduction under s. 32(1)(vi). The alternative claim for development rebate was rejecte....

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....which is either static or mobile. The necessary power for working the machine tools is supplied from outside either mechanically or through an electric motor etc. If the interpretation placed by revenue on machine tools were to be accepted, a large number of machine tools regarded as such in industry would not be considered as machine tools at all. We, therefore, hold that the assessee is entitled to initial depreciation on the machineries of the value of Rs. 13,27,398. The order of the CIT (A) in this behalf is set aside and the assessee's ground succeeds. In the view that we have taken, it is not necessary for us to consider the alternative contention regarding allowance of development rebate. 5. The second ground is about the disallow....