COMMISSIONER OF INCOME-TAX VS D.P.S (I.) (PVT.) LTD., 1998 PTD-CALCUTTA-HIGH-COURT-INDIA 2809 (1996)

(a) Income-tax---

----Depreciation---Extra-shift allowance---Plant or machinery specifically excluded from allowance---Extra-shift allowance cannot be allowed in respect of such plant or machinery---Indian Income Tax Act, 1961, S.32-- Indian Income Tax Rules, 1962, R.5, Appendix I, Part I, item III, sub-item (iv).

(b) Interpretation of statutes---

---- Literal interpretation---Special provision overrides general provision.

When the intention of the legislator is very clear and, when there is no doubt in gathering such an intention by a clear and unambiguous reading of the provisions of law, importing extraneous considerations or giving reasons which were not wholly germane to the points involved is not permissible under the law.

Under rule 5 of the Income Tax Rules, 1962, an assessee is entitled to claim depreciation allowance in respect of buildings, machinery, plant or furniture as may be included at the percentages specified in the second column of the Table in Part I of Appendix I to the 1962 Rules on the actual cost or, as the case may be, the written down value of such assets aforesaid for the purposes of the business or profession of the assessee at any time during the previous year. Item III, sub-item (iv) of Part I of Appendix I deals with and relates to the provision for extra-shift depreciation allowance and says that an extra-shift allowance up to a maximum of an amount equal to one-half of the normal allowance shall be allowed where a concern claims such allowance on account of double shift working and establishes that it has worked double shift. While prescribing for the provision and grant of extra shift depreciation allowance, item III, sub-item (iv), itself clearly stipulates that the extra-shift allowance shall not be allowed in respect of any item of machinery or plant which has been specifically excepted by inscription of the letters NESA against such an item occurring in Part I of Appendix I and also in respect of items of machinery mentioned therein. A combined reading of rule 5 with item III, sub-item (iv) in Part I of Appendix I and the second illustration contained in item III, sub-item (iv), clearly suggests that there is no ambiguity about the intention of the Legislature in not granting and allowing extra-shift allowance in respect of the items of plant and machinery mentioned in Part I against which the inscription NESA finds a place. It is a well-established principle of law that a specific provision overrides a general provision. Whereas sub-item (iv) providing for the grant of extra-shift allowance is a general provision, the illustration forming an integral part of the same clause is a special and specific provision which prohibits and debars the grant of extra-shift allowance in respect of some specified items of plant and machinery against whose names the inscription NESA is found mentioned in the Table:

Held accordingly, that the Tribunal was not justified in law in holding that data processing machines, central air-conditioning plants and air-conditioners are entitled to extra-shift allowance though the words NESA are inscribed against such machinery and plant.

R.C. Prosad for the Commissioner.

M.L. Bhattacharyya for the Assessee.

JUDGMENT

V.K. GUPTA, J.---By this common judgment, we propose to dispose of the two income-tax references, being Income-tax Reference No.60 of 1992 and Income-tax Reference No. 128 of 1993. The same question of law in both the references has been referred for our opinion. The question reads as under:

"Whether, on the facts and in the circumstances of the case and on a correct interpretation of the relevant rules for the allowance of extra shift allowance under the Income-tax Rules, 1962, the Tribunal was justified in law in holding that data processing machine, central air conditioning plant and air-conditioner's are entitled to extra-shift allowance though the words NESA (No Extra Shift Allowance) are '' inscribed against such of the above machinery or plant in the said Rules'?"

Under rule 5 of the Income-tax Rules, 1962, an assessee is entitled to claim depreciation allowance in respect of depreciation of buildings, machinery, plant or furniture as may be included at the percentages specified in the second column of the Table in Part I of Appendix I to the 1962 Rules on the actual cost or, as the case may be, the written down value of such assets aforesaid for the purposes of the business or profession of the assessee at any time during the previous year. Since Part I of Appendix I to the Rules has been made the basis for claiming depreciation in terms of rule 5 of the 1962 Rules, we have to refer to this said Part I of Appendix I to determine and find out as to whether the assessee is entitled to claim extra-shift allowance on data processing machines, central air-conditioning plants and air-conditioners. Before we do that it shall be advantageous to refer to item III, sub-item (iv) occurring in Part I of Appendix I to the 1962 Rules. This clause deals with and relates to the provision for extra-shift depreciation allowance and says that an extra-shift allowance up to a maximum of an amount equal to one-half of the normal allowance shall be allowed where a concern claims such allowance on account of double shift working and establishes that it has worked double shift. Various other stipulations are contained in item III, sub-item (iv), relating to the provision and grant of extra-shift depreciation allowance. While prescribing for the provision and grant of extra-shift depreciation allowance, sub-item (iv) itself clearly stipulates that the extra-shift allowance shall not be allowed in respect of any item of machinery or plant which has been specifically excepted by inscription of the letters NESA against such an item occurring in Part I of Appendix I and also in respect -of items of machinery mentioned therein. The relevant extract of the illustration forming part of item III, sub-item (iv) in Part I of Appendix I may be reproduced to indicate the clear intention about the disallowance and non-provision of the extra-shift allowance. The extra reads as under:

"The extra-shift allowance shall not be allowed in respect of any item of machinery or plant which has been specifically excepted by inscription of the letters 'N.E.S.A.' (meaning 'No Extra Shift Allowance') against it in sub-item (ii) above and also in respect of the following items of machinery and plant to which the general rate of depreciation of ten per cent. applies,---

While going through the various items contained in Part I, we find that against the items of data processing machines, air-condition machines and air-conditioners, the inscription NESA has been written and inscribed. From the fact that the inscription NESA has been inscribed against the aforesaid three items occurring in Part I of Appendix I, the intention of the Legislature is very clear that, even though extra-shift allowance is allowable for some items of plant and machinery where a concern claims such allowance on account of double shift working, etc., etc., such allowance has been specifically disallowed in respect of such plants and machinery, despite the aforesaid claim of the assessee being entitled to, if the inscription NESA is found incorporated and mentioned against the relevant entry relating to such plant and machinery in Part I of Appendix I. If we read rule 5 of the 1962 Rules we find that the allowance of depreciation has to be calculated at the percentage specified in the second column of the Table in Part I of Appendix I to the Rules and in accordance with the provisions contained herein. A combined reading of rule 5 with item III, sub-item (iv) in Part I of Appendix I and the second illustration (supra) contained in item III, sub-item (iv) clearly suggests that there is no ambiguity about the intention of the Legislature in not granting and allowing extra-shift allowance in respect of the items of plant and machinery mentioned in Part I against which the inscription NESA finds a place.

It is a well-established principle of law that a specific provision over rides a general provision. Whereas sub-item (iv) providing for the grant of extra-shift allowance is a general provision, the illustration forming an integral part of the same clause is a special and specific provision which prohibits and debars the grant of extra-shift allowance in respect of some specified items of plant and machinery against whose names the inscription NESA is found mentioned in the Table. In other words, it can be also be said that the Legislature took away the concession of the grant of extra-shift allowance in sub-item (iv) itself by expressly and specifically excluding certain items of plant and machinery, even while it allowed this concession to certain other items. Thus, reading the two together, i.e., the illustration and item (III), sub-item (iv), we find that there is neither any ambiguity nor any uncertainty in interpreting this intention of the Legislature. When, therefore, the intention of the legislator is very clear and, when there is no doubt in gathering such an intention by a clear and unambiguous reading of the provisions of law, importing extraneous considerations of giving reasons which are not wholly germane to the points involved is not permissible under law. We have very carefully gone through the judgment and order of the Income-tax Appellate Tribunal passed on April 26, 1991, in Income-tax References Nos.2004 and 2005 of 1989 relating to the assessment years 1984-85, 1985-86 and 1986-87 and find that in reasoning given by the Tribunal for allowing extra-shift allowance in respect of data processing machines, air-conditioners and air-condition plants is wholly erroneous and patently contrary to the Income-tax Rules, 1962. Merely saying that these machines and appliances are part and parcel of the plant and machinery and that extra-shift allowance is allowable on the plant and machinery cannot be a ground for allowing extra-shift allowance because the legislator has clearly prohibited such allowance by incorporating the inscription NESA against each of these items. No one can be allowed to go beyond the express provisions of law, if law on a particular subject is clear and unambiguous. No one can import any reasoning, however, sound it may appear which is contrary to the express provisions of law. In the present case, the law is absolutely clear and totally unambiguous. Even while it provides for the grant of extra-shift allowance in respect of certain items of plant and machinery, at the same time it also clearly stipulates that in respect of some specified items of plant and machinery such allowance cannot be given. It is not understandable as to how the Tribunal ignored the inscription NESA and by importing its own reasoning allowed extra-shift allowance in favour of the assessee.

For the foregoing reasons, therefore, we answer the question in the negative, in favour of the Revenue and against the assessees in both the references. Our opinion may be transmitted to the Tribunal for appropriate action. There shall be no order as to costs.

M.B.A./1552/FC Reference answered.