JUDGMENT
S.P. Bharucha, C.J.
1. In this reference under the Income-tax Act, 1961, we are concerned with assessment for the assessment year 1979-80. Three questions are referred. The first question reads thus :
“Whether, on the facts and in the circumstances of the case, the expenditure incurred in respect of the Dairy Machinery Unit is deductible as a expenditure laid out for the purposes of business of the assessee ?”
Counsel are agreed that the question must be answered in the affirmative and in favour of the assessee in view of the judgment of this court in the assessee’s own case (CIT v. Hindustan Machine Tools (No. 2) [1989] 175 ITR 216). The question is so answered.
2. The second question we are called upon to answer reads thus :
“Whether, on the facts and in the circumstances of the case, the assessee is entitled to extra shift allowance in computing depreciation for the water system and sanitation and technical documentation ?”
3. In so far as depreciation for water system and sanitation is concerned, the question is covered by the decision of the court in the case of CIT v. Motor Industries Co. Ltd. [1988] 173 ITR 374. In so far as the question relates to depreciation for technical documentation is concerned, it is covered by the judgment of the Supreme Court in Scientific Engineering House P. Ltd v. CIT . Having regards to these judgments, the second question, as it is agreed, it to be answered in the affirmative and in favour of the assessee and it is so answered.
4. The third question to be answered reads thus :
“Whether, on the facts and in the circumstances of the case, the assessee was entitled to depreciation on the extra expenditure incurred on account of fluctuation in foreign exchange rate which was capitalised ?”
5. This question, it is agreed, is covered by the judgment of this court in the assessee’s own case, Hindustan Machine Tools Ltd. (No. 3) v. CIT [1989] 175 ITR 220, and following that judgment, it has to be answered in the affirmative and in favour of the assessee. It is so answered.