Ad-Free CAclubindia and Daily Updates on your mobile. Subscribe Now!

Additional Depreciation

Sagar Kulkarni (Articled Assistant) (85 Points)

01 December 2010

Whether Printing amounts to 'Manufacture' for the purpose of Additional Depreciation u/s 32 of the Income Tax Act, 1961? Please quote the relevant case law, if any.

Reply
Follow
Share

2 Replies

Devendra (Chartered Accountant) (4775 Points)
Replied 01 December 2010

Dear Sagar Kulkarni,

Following is the definition of the word 'manufacture'

Manufacturing is the use of machines, tools and labor to make things for use or sale. The term may refer to a range of human activity, from handicraft to high tech, but is most commonly applied to industrial production, in which raw materials are transformed into finished goods on a large scale. ..

Some more defintions of the word 'manufacture' :-

put together out of artificial or natural components or parts; "the company fabricates plastic chairs"; "They manufacture small toys"; He manufactured a popular cereal"
fabricate: make up something artificial or untrue
produce naturally; "this gland manufactures a specific substance only"
industry: the organized action of making of goods and services for sale; "American industry is making increased use of computers to control production"
create or produce in a mechanical way; "This novelist has been manufacturing his books following his initial success"

From the above definition, as per my views printing does not result in manufacturing, thus you cannot avail the benefit of additional depreciation u/s 32(i)(iia).

But you can still wait for the views of other members.

Thank You,

Regards,

Devendra P Kulkarni

Upgrade to CAclubindia Pro. Subscribe Now!

Vinay Raja (student-IPCC) (704 Points)
Replied 01 December 2010

As per sec 2(29BA) of It act - manufacture with all its gramatical variations, shall mean a change in a non-living physical object or article or thing

a)Resulting in transformation of object or thing into a new or distinct object or article or thing, having different name, character and use

b)Bringing into existence a new object or article or thing with different chemical composition or integral structure.

as per my knowledge, YES manufacture includes Printing, because

an empty fair paper is transformed into newspaper(say) which has a different name and use