SUPREME COURT OF INDIA

Before:- S.P. Bharucha and Mrs. Ruma Pal, JJ.

Civil Appeal No. 841 of 2000, (arising out of S.L.P. (C) No. 4847 of 1999). D/d. 4.2.2000.

C.I.T., A.P. - Appellant

Versus

Srinivasa Hatcheries P. Ltd. - Respondent

Income-tax Act, 1922, Sections 256(2), 32 - High Court - Income-Tax - Reference - Rate of depreciation as applicable to plant or building - Question whether poultry sheds are to be treated as plant and not mere building is a question of law - Reference of such a question to High Court for deciding as to whether higher rate of depreciation as applicable to plant is applicable to such activity or not, held permissible.

[Paras 3 and 5]

Cases Referred :-

Commissioner of Income-tax v. Sri Venkateshwara Hatcheries (P) Ltd. (1997 (225) ITR 116) (Andh Pra).

ORDER

Delay condoned.

2. Leave granted.

3. The High Court, by the order under challenge, declined to call upon the Income-tax Appellate Tribunal to refer to it the following question on the ground that the Tribunal had followed the High Court' s judgment in the case of Commissioner of Income-tax v. Sri Venkateshwara Hatcheries (P) Ltd. (1997 (225) ITR 116) (Andh Pra).

"Whether on the facts and in the circumstances of the case the poultry sheds should be treated as plant thereby allowing the assessee company a higher rate of depreciation as applicable to plant and not the rate of depreciation as applicable to building?"

4. We are informed that the judgment of the High Court in the said case of Sri Venkateshwara Hatcheries (P) Ltd. was brought to this Court but the special leave petition was dismissed on the ground of delay.

5. It appears to us clear that a question of law is involved and that, therefore, the High Court ought to have required the Tribunal to refer to it the aforestated question. The High Court then would be entitled to consider the question on merits and take the earlier judgment in the case of Sri Venkateshwara Hatcheries (P) Ltd. into account.

6. The appeal is allowed. The order under appeal is set aside. The aforesaid question shall be referred by the Tribunal to the High Court for its decision, after drawing up a Statement of Case.

7. No order as to costs.

Appeal allowed.