- (1.) THE matter here pertains to the admissibility of investment allowance in respect of machinery or plant for cold storage under Section 32a (2) (b) (ii) of the Income-tax Act, 1961 (hereinafter referred to as "the Act" ).
(2.) DURING the assessment year 1978-79, the assessee, S. Warriam Singh Cold Stores, claimed a sum of Rs. 64,399 in respect of machinery and plant installed in their cold storage business. This was declined by the Income-tax Officer and also in appeal by the Appellate Assistant Commissioner, but was accepted by the Commissioner of Income-tax (Appeals) (sic ) whose decision was later upheld by the Tribunal. This is what led to the following question being referred for the opinion of this court: "whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in holding that machinery or plant installed for the purpose of business of cold storage is covered under Section 32a (2) (b) (ii) for the purpose of the admissibility of deduction under Section 32a (1) by way of investment allowance ?"
(3.) IN dealing with this matter, counsel for the Revenue sought to rely upon the judgment of the High Court of Calcutta in S. B. Cold Storage Industries Pvt. Ltd. v. CIT [1987] 166 ITR 646 (Cal), where it was held that as the object of putting goods in cold storage was mainly to preserve their original condition and not to produce anything new and that by such preservation, no new marketable article is brought into existence, machinery or plant installed in the cold storage was not for manufacture or production of any article or thing and no investment allowance in respect thereof accrued under Section 32a of the Act.;