Shri Ram Piston And Rings Ltd. vs Cit
2007 Latest Caselaw 1307 Del

JUDGMENT

1. In this reference under Section 256(1) of the Income Tax Act, 1961, the following three questions of law have been referred for our opinion:

1. Whether the Income Tax Appellate Tribunal erred in law in holding that for the purpose of applying Section 40A(5) of the Income Tax Act,1961 the value of perquisite on account of the cars provided by theassessed to its employees should be taken on the basis of actual expenditure incurred and not in terms of rule 3(c)(i) of the Income-tax Rules, c1962?

2. Whether, on the f acts and in the circumstances of the case, the Income Tax Appellate Tribunal erred in holding that for evaluating the perquisite value of gas, water and electricity provided to the four employees had to be taken on the basis of actual expenditure incurred for this purpose or they could be determined under rule 3D of the Income-tax Rules, 1962 for the purposes of calculating the disallowance under Section 40A(5) ?

3. Whether on the facts and in the circumstances of the case and in view of the provisions of Section 43 A, the Income Tax Appellate Tribunal erred in holding that the amount of Rs. 22,76,819 could not be increased towards the price of the machinery and plant for the purpose of claiming depreciation under the Income Tax Act ?

2. The admitted position is that the first two questions are required to be answered in favor of the revenue and against the assessed in view of the decision of Supreme Court in CIT v. British Bank of Middle East '. The third question is required to be answered in favor of the assessed and against the revenue in view of the decision of this Court in CIT v. Woodward Governor India (P) Ltd. (2007) 162 Taxman 60.

3. The reference is disposed of as above.