Delhi High Court
Gsc Industries (P) Ltd. vs Colilussioner Of Income Tax on 12 July, 1999
Equivalent citations: (1999)156CTR(DEL)267
ORDER AR UN KUMAR, J.
Under s. 256C) of the Income Tax Act, 1961 (for short 'the Act'), the Tribunal has referred the following question of law in respect of the assessment year 1970-71, for the opinion of this Court :
1. "Whether the seats installed in the cinema auditorium constitutes plant within the meaning of s. 43(3) and whether the assessee is entitled to development rebate in respect thereof under s 33 of the Act, 1961 ?"
2. The question whether the chairs installed in an auditorium could be treated as "plant" within the meaning of s. 43(3) of the Act and whether the assessee was entitled to claim development rebate in respect thereof, under section 33 of the Act, came up for consideration before the Bombay High Court in CIT v. N.L. Mehta Cinema Enterprises (P) Ltd. (1994) 121 CTR (Bom) 223 : (1995) 216 IM 437 (Bom) and relying on a decision of the Supreme Court in CIT v. Tal Mahal Hotel 1973 CTR (SC) 480 : (1971) 82 ITR 44 (SC) 0 and on a decision of the Karnataka High Court in Santosh Enterprises v. CIT (1993) 200 ITR 353 (Kar) 1, the Court held that the chairs in the auditorium of a cinema theatre are "plant and the assessee was entitled to development rebate in respect of them. While holding so, the Court observed that the chairs and the auditorium are essentially functional in nature, being integral part of the exhibition of films.
3. Following the ratio of the said decision, with which we are in respectful agreement, we answer the question in the affirmative i.e., in favour of the assessee and against the department.
There will be no order as to costs.