Ajit K. Sengupta, J.:— In this reference under section 256(1) of the Income-tax Act, 1961, for the assessment year 1982–83, the following questions of law have been referred to this court:

“1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in concluding that the plant and machinery of Rs. 3,79,793 were new and the installation of them was completed during the accounting year relevant to the assessment year 1982–83?

2. Whether, on the facts and in the circumstances of the case and having regard to the fact that there was a change in the shareholding of the assessee-company, the Tribunal was right in law in allowing carry forward of the unabsorbed depreciation and unabsorbed investment allowance under section 79 of the Income-tax Act, 1961?”

2. The assessee is a private limited company which owns a factory at Jhargram with its head office at Calcutta and had no manufacturing business of its own with its own machinery since its incorporation. By virtue of an agreement dated November 1, 1969, with M/s. Sakbry Engineering Corporation, a firm in which a director of the assessee-company was a partner, the assessee-company had agreed to work as rolling contractor to take over the charge of production and rolling of tubes and pipes at the tube mill owned by the said firm with the raw materials to be supplied by the firm under the planning, direction and control of the firm. During the year under reference, besides running the tube mill of M/s. Sakbry Engineering Corporation, the assessee-company installed some plant and machinery of its own and put them to use for production of rolling tubes and pipes in its factory premises at Jhargram. The assessee claimed investment allowances on all the machinery valued at Rs. 6,50,050. The Income-tax Officer found that, out of the machinery valued at Rs. 6,50,050, machinery valued at Rs. 3,79,793 was purchased during 1969–70 to 1974–75 accounting years and the balance of Rs. 2,70,257. was purchased in the previous year relevant to the assessment year 1982–83 which is under consideration. The Income-tax Officer, therefore, allowed investment allowance on machinery valued at Rs. 2,70,257 only. The assessee-company also claimed additional depreciation under section 32(1)(iia) of the Act on machinery valued at Rs. 6,50,050 irrespective of their dates of purchase and claimed that the installation of the said machinery was made during the year under consideration. The Income-tax Officer did not allow additional depreciation on the machinery claimed by the assessee on the ground that the provisions of section 32(1)(iia) of the Act were introduced with effect from April 1, 1981, and, therefore, machinery acquired prior to April 1, 1981, was not entitled to additional depreciation. Further, there was a change in the original management of the assessee-company. Against the aforesaid order of the Income-tax Officer, the assessee preferred an appeal before the Commissioner of Income-tax (Appeals) who found that, since the purchase of the machinery, there was a change in the management of the assessee-company and the machines were under installation and the installation process was completed during the year under reference. The Commissioner of Income-tax (Appeals), therefore, directed the Income-tax Officer to allow investment allowance on the entire machinery valued by the assessee at Rs. 6,50,050 and also to allow additional depreciation under section 32(1)(iia) of the Act apart from normal depreciation allowable to the assessee.

3. Against the aforesaid order of the Commissioner of Income-tax (Appeals), the Department came up in appeal before the Tribunal on the points of investment allowance and additional depreciation allowance. The Tribunal observed that the disputed machinery was new and was under installation and the installation was completed during the year under consideration. The Tribunal further observed that no depreciation was ever claimed by the assessee prior to those years on that machinery. The Tribunal, therefore, held that the Commissioner of Income-tax (Appeals) was perfectly justified in allowing investment allowance and additional depreciation in addition to the normal depreciation on the machinery.

4. While computing the assessee's total income, the Income-tax Officer did not carry forward the unabsorbed investment allowance, etc. Against that order of the Income-tax Officer, the assessee filed an appeal before the Commissioner of Income-tax (Appeals). The assessee submitted before the Commissioner of Income-tax (Appeals) that the Income-tax Officer was not justified in not allowing the carry forward of unabsorbed depreciation, etc. The Commissioner of Income-tax (Appeals) directed the Income-tax Officer to allow the carry forward of the unabsorbed depreciation and unabsorbed investment allowance, if any. Being aggrieved, the Department came up in appeal before the Tribunal. The Tribunal confirmed the action of the Commissioner of Income-tax (Appeals) on this point.

5. During the hearing before us, Mr. Mitra, learned counsel for the Revenue, has contended that the finding of the Tribunal that the machinery and plant was new is not supported by any evidence on record. He has further submitted that the machinery in question was purchased long ago and it could not be treated as new machinery and plant and the objective of section 32A or 32(1)(iia) is to grant the benefit of investment allowance or additional depreciation allowance, as the case may be, on new plant and machinery. We are, however, unable to accept the contention of Mr. Mitra for more than one reason. Firstly, the finding of the Tribunal that the plant and machinery was new has not been disputed nor has it been challenged by any appropriate question. Secondly, the relevant provisions would clearly show that acquisition of plant and machinery is not material; what is material is the installation of such plant and machinery for claiming additional depreciation allowance or investment allowance, as the case may be. In this connection, we may set out the relevant provisions of section 32(1)(iia) and section 32A which read as under:

“32. (1)(iia) In the case of any new machinery or plant (other than ships and aircraft) which has been installed after the 31st day of March, 1980, but before the 1st day of April, 1985, a further sum equal to one-half of the amount admissible under clause (ii) (exclusive of extra allowance for double or multiple shift working of the machinery or plant and the extra allowance in respect of machinery or plant installed in any premises used as a hotel) in respect of the previous year in which such machinery or plant is installed or, if the machinery or plant is first put to use in the immediately succeeding previous year, then, in respect of that previous year.

32A.(1) In respect of a ship or an aircraft or machinery or plant specified in sub-section (2), which is owned by the assessee and is wholly used for the purposes of the business carried on by him, there shall, in accordance with and subject to the provisions of this section, be allowed a deduction, in respect of the previous year in which the ship or aircraft was acquired or the machinery or plant was installed or, if the ship, aircraft, machinery or plant is first put to use in the immediately succeeding previous year, then, in respect of that previous year, of a sum by way of investment allowance equal to twenty-five per cent. of the actual cost of the ship, aircraft, machinery or plant to the assessee;”

(emphasis* supplied)

6. It will be evident that what is relevant and material is the year of acquisition in the case of ships or aircraft and the year of installation in the case of machinery or plant. If the installation of a plant is spread over more than a year, the relevant year for the grant of allowance would be the year in which the installation is completed. As in the case of investment allowance, so also in the case of additional depreciation, the material date is the date of installation and not the year of acquisition. The Tribunal categorically found on a perusal of the assessment order for the assessment years 1980–81 and 1981–82 and the relevant balance-sheets of the assessee-company that the machines in question were shown as machines under installation in the previous years in the fixed assets schedule annexed to the balance-sheet. These machines have been only transferred to the machines account during the year under reference. No depreciation was claimed by the assessee on these machines and depreciation was only claimed on the machines which were shown as machines of the assessee in the fixed assets schedule. Two things would, therefore, be clear; firstly, these machines were new and they were under installation and the installation was completed during the year under reference; and secondly, no depreciation was ever claimed by the assessee prior to this assessment year on these machines. This finding of the Tribunal has not been challenged. The Tribunal also found that the machines, although acquired earlier, could not be installed in view of the change of management twice. The machines were lying idle and were kept for installation and the installation was completed in the year under reference.

7. In our view, therefore, neither section 32(1)(iia) nor section 32A requires that the machinery or plant has to be put into use in the year in which it is acquired for the purpose of claiming additional depreciation allowance or investment allowance. Our attention has been drawn to the decision of the Punjab and Haryana High Court in the case of Commissioner Of Income-Tax v. Jaideep Industries., [1989] 180 ITR 81, where it has been held that the assessee is entitled to the benefit of section 32A, if the machinery or plant is installed after April 1, 1976.

8. For the reasons aforesaid, we answer the first question in this reference in the affirmative and in favour of the assessee.

9. So far as the second question is concerned, it is now concluded by a decision of this court in the case of this assessee in I.T.R No. 92 of 1988, where the judgment was delivered on November 21, 1990. Following the said decision, we answer the second question in the affirmative and in favour of the assessee. There will be no order as to costs.

Shyamal Kumar Sen, J.:— I agree.