SUNIL KUMAR GARG, J. - (1.) THIS is a reference under Section 256(1) of the Income Tax Act, 1961 (hereinafter referred to as 'the IT Act') at the instance of the Income Tax Appellate Tribunal, Jaipur Bench, Jaipur and the Tribunal has referred the following common question of law in the case of assessee for the assessment years 1986 -87 and 1987 -88 for answer by this Court: Whether on the facts and in the circumstances of the case the ITAT is legally justified in allowing depreciation and extra depreciation on hotel building by treating it as a plant?
(2.) THE facts giving rise to this reference, in short, are as follows: The assessee is a Company running hotels at Udaipur. The hotels of the assessee -Company were being operated by the Indian Hotels Company Limited and 50% of the net operating profits were paid as operation fees. The assessee -Company claimed depreciation on the hotel building at the rate of 15% treating the same as Plant., However, the Dy. Commissioner of Income -tax (Assmt). Special Range, Udaipur vide his order dated 28.2.1989 did not accept the claim of the assessee and, as such, depreciation of building was resticted to 5% only and accordingly, extra depreciation was disallowed. Aggrieved from the said order dated 28.2.1989 passed by the Dy. Commissioner of Income -tax (Assmt). Special Range, Udaipur, an appeal was filed by the assessee before the Commissioner of Income Tax (Appeals), Jodhpur Camp: Udaipur and that appeal was decided vide judgment dated 13.2.1990. The Commissioner, Income Tax (Appeals), Jodhpur Camp: Udaipur, after due consideration of the fact that Income Tax Appellate Tribunal, Jaipur Bench, Jaipur has earlier accepted the plea of the appellant -assessee in regard to treating the said hotel as a Plant, came to the conclusion that the claim of the appellant -assessee should have been accepted and accordingly, it was directed that depreciation be allowed on hotel building by treating it as Plant as per the provisions of law.
(3.) AGGRIEVED from the judgment of the Commissioner of Income Tax (Appeals), Jodhpur Camp: Udaipur dated 13.2.1990, an appeal was preferred by the Dy. Commissioner of Income Tax (Assmt) Special Range, Udaipur before the Income Tax Appellate Tribunal, Jaipur Bench, Jaipur and the Tribunal vide judgment dated 30.9.1994 dismissed the appeal by holding that the issue involved in the case stands covered in favour of the assessee by the earlier decision of the Tribunal in assessee's own case for the assessment year 1985 -86 (ITA No. 571/JP/89) and thus, confirmed the judgment dated 13.2.1990 passed by the Commissioner Income Tax (Appeals), Jodhpur, Camp: Udaipur.;