Ponds which were specially designed for rearing/breeding of the prawns have to be treated as tools of the business of the assessee and the depreciation was admissible on these at the rates applicable to plant and machinery
The assessee-company was doing business of ‘Aqua Culture’. It grows prawns in specially designed ponds. Thus, the disputed issue was:
Whether such ponds constitutes plant under Section 32?
The Supreme Court held that since the ponds were specially designed for rearing/breeding of the prawns, thus, they have to be treated as tools of the business of the assessee. Therefore, such ponds would be treated as plant for the purpose of allowing depreciation thereon. - ACIT V. VICTORY AQUA FARM LTD. 61 taxmann.com 166 (SC)