S.K. CHANDER, A.M. This fascicle of appeals by assessee pertaining to asst. yr. 1981-82 to 1983-84 involve common issues. We, have therefore, heard them together n d are disposing of same by consolidated order. These appeals are directed against three orders of CIT (A) X. New Delhi. main order is made by ld. Commissioner for asst. yr. 1981-82 on 12th June, 1984 and for subsequent two years, he has followed his conclusions arrived at in this year, in so far as applicable to subsequent assessment years, in his orders dt. 22nd June, 1984 and 14th Nov., 1984 respectively. first common issues that we have to determine in these appeals is whether facts and in circumstances of case, ld. CIT (A) erred in not allowing depreciation at higher rate of depreciation applicable to plant as claimed by assessee. On this issues, we have heard parties, given careful consideration to their submissions and also carefully perused relevant authorities cited. We are absolutely convinced that authorities below erred in rejecting claim of assessee for allowance of depreciation at higher rates on hotel building treating it as plant. assessee, therefore is entitled to succeed on this issue, for each year, for following reasons. When assessee filed return for asst. yr. 1981-82 it hand claimed depreciation on hotel building at normal rates applicable to buildings. However, at time of assessment proceedings before ITO claim was made that assessee was entitled to depreciation at enhanced rates considering hotel building as plant. This claim of assessee was rejected by ITO with observation that hotel building cannot be said to be plant. When matter came up in appeal before CIT (A), assessee projected to him judgment of Tribunal in case of M/s Hotel Srilekha, Madras, wherein Hon ble Tribunal had held that hotel building is to to be treated as plant for purpose of allowing higher relate of depreciation. Commissioner considered this judgment but did not concede to claim made by assessee for reasons that he has assigned in his impugned order. It has now been well settled by Supreme Court of India that in order to determine whether particular thing or article will qualify as "plant" it has to have some degree of durability. test to be applied as laid down by Hon ble Supreme Court is: (i) Did article fulfil function of plant in assessee s trading activity? (ii) Was it tool of his trade with which he carried on his business? Court has further observed that if answer was in affirmative, it would be "plant". It is also very important to note that concept of "plant" was not necessarily confined to apparatus which was used for mechanical operations or process or was employed in mechanical or industrial business. These observations were made by Court in case of Scientific Engg. House Pvt. Ltd. vs. CIT Andhra Pradesh (1985) 49 CTR (SC) 386: (1986) 157 ITR 86 (SC). It is also equally well settled now that intention of legislature was to give word "plant" wide meaning as pointed out by Hon ble Supreme Court in case of CIT vs. Taj Mahal Hotel 1973 CTR (SC) 480: (1971) 82 ITR 44 (SC). Court has further pointed out in said case that IT Rules are meant only for purpose of carrying out provisions of Act and they cannot take away what it conferred by Act or whittle down its effect. assessee is carrying on business of running hotel under name of "Hotel Rajdoot: Mathura Road, New Delhi. It is well known and in fact cannot be denied that business of hotelier is carried on by adopting building or premises in suitable way to be used as residential hotel where visitors come and stay and where there is arrangement for meals and other amenities are provided for their comfort and convenience. visitors seeking transitory stay would like to have necessary conveniences and amicable environment conditions. Therefore, adaptability of building for purpose of running hotel is absolutely essential and when it is fitted with other furniture and fittings, entire complex becomes apparatus used for carrying on business to earn profits therefrom. adaptation of building along with furniture and fittings with necessity environmental changes is commercial necessity for carrying on business of assessee in profitable manner. hotel building, therefore, in context becomes assessee s tool of trade, around which entire business of assessee involves. hotel premises are used in manner to which ordinary building on which specified rates of depreciation are provided is not put to use. In fact in rules providing rates of depreciation, there is no rate of depreciation provided as such for building in which business of hotel is being carried on. But then that should not deter us from determining whether such building would be entitled to higher rates of depreciation for its use and occupation in manner befitting running of hotel. We have also to bear in mind principles laid down by Supreme Court that intention of legislature was to give word "Plant" wide meaning and rules cannot be taken as to whittling down effect of such provision. Therefore, it cannot be said that rules of depreciation provided for ordinary building could only be applied to hotel building. It has been submitted on behalf of Revenue before that there is clear indication in rules and relevant provisions of law that rates prescribed for purpose of depreciation of buildings should be applied and since, there is nothing special about hotel building claim of assessee for higher rates of depreciation is not admissible. we also find that ld. CIT(A) from case of J. Lyons & Co. Ltd. vs. Attorney Central (1944) Ch. 281. However, we find that this case was relied upon on behalf of Revenue in case of Taj Mahal Hotel referred to supra, but was not considered as decisive of type of issue before us. On other hand, Hon ble Supreme Court observed. "The more opposite decision is that of Court of Appeal in Jerrold (Inspector of Taxes) vs. John Good & Sons Ltd. (1963) 1 WLR 214, 223 (CA). In that case, nature of assessee s business required that its office accommodation should be capable of subdivision into number of rooms varying in size according to requirements from time to time of agencies which it carried on. office accommodation consisted of large open floor space in which partitions could be erected so as to subdivide floor space into number of rooms of any size. question was whether partitions were plant within meanings of ss. 279 and 280 of English IT Act, 1952 so as to entitle Company to allowance under those sections. It was held that partitions were used to allowance under those sections. It was held that partitions were used to enable trader to cope with vicissitudes of business as it increased and diminished and these partitions provided was commercial necessity for Company". When we examine claim of assessee in light of above, there i s no doubt that hotel building with its furniture and fittings as whole constitutes plant, tool of trade of assessee. However, before us there is no other point except claim projected on behalf of assessee that in so far as hotel building is concerned, rate of depreciation at 10 per cent be allowed. In our considered opinion, this rate is applicable and allowable in respect of said building. This claim of assessee is therefore, accepted and orders of authorities below on this issue are set aside with directions to ITO to allow deprecation at above rates on hotel building while recomputing total income of assessee. This ground of appeal for all years is, therefore, allowed. only other ground which survives for consideration and is common to all three years, relates to allowance of expenditures claimed by assessee but disallowed by ITO holding expenditure to be of nature of entertainment expenditure. CIT (A) upheld order of ITO. Before us, ld. counsel for assessee attempted to make out case that expenditure is incurred on tea, etc. provided to incoming tourists when they are making entries in registers maintained by hotel before actual allotment of rooms to them. However, on enquiry from Bench it was found that neither this plea was taken at any of stages below nor was there any evidence in its support. We find that in that assessee s own words Rs. 25,026 were spent on refreshments to customers, tour conductors and group leaders. Similarly, Rs. 5,120 was spent on cost of fruits and sweets disbursed to customers. This expenditure in our considered opinion is squarely hit by Explanation (2) to s. 37(2) inserted by Finance Act, 1983 with retrospective effect from 1st April 1976. authorities below were, therefore, justified in giving it treatment that they did. This ground for each of assessment years is dismissed. Appeals partly allowed. *** HOTEL RAJDOOT PVT. LTD. v. INDPRCTING ASSISTANT COMMISSIONER (ASSESSMENT)