Roads inside & within boundary wall of premises are part of factory buildings

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HIGH COURT OF RAJASTHAN

Commissioner of Income-tax, Jaipur

v.

Sunshine Glass Indus (P.) Ltd.

D.B. IT REFERENCE NO. 12 OF 1984

OCTOBER 28, 2010

In Hukamchand Mills Ltd. v. CIT [1978] 114 ITR 870 (Bom.), the roads laid out within factory premises were regarded as part of factory buildings and were entitled to depreciation. In the case of CIT v. Lucas TVS Ltd. [1977] 110 begin_of_the_skype_highlighting FREE [1977] 110 end_of_the_skype_highlighting ITR 346 (Mad.), the word ‘building’ was held to include roads laid in the proximity of factory for the purpose of providing access to factory and other buildings within compound and they were entitled to depreciation. The aforesaid view taken by the High Courts was correct because roads constructed inside and medium boundary wall of premises, be it a building or factory, are meant to augment utilization thereof. Such roads are eventually intended to augment utilization of building/factory by providing access thereto. In view of above, the impugned order of the Tribunal allowing assessee’s claim for depreciation was to be upheld.