Cases - C.I.R. v Scottish and Newcastle Breweries Ltd
Record details
- Name
- C.I.R. v Scottish and Newcastle Breweries Ltd
- Date
- (1982)
- Citation
- 55 TC 252
- Legislation
- Keywords
- Capital allowances - plant and machinery - apparatus used for purpose of a business - functional test - whether light fittings and other decorative items were plant - Finance Act 1971, s. 41
- Summary
-
In this case, the company spent money on light fittings and wiring and decorative items such as wall plaques, tapestries, murals, prints and sculptures. The Special Commissioners found that the electric wiring was part of the fabric of the building. They found that everything else was plant, on the grounds that everything but the electric wiring went to create the atmosphere or ambience that it was an important function of the company's particular trade to provide for its customers to enjoy. They found that the light fittings and decorative items satisfied the functional test required of plant, despite the fact that they formed part of the setting within which the trade was carried on.
In the House of Lords, Lord Lowry said:
'something which becomes part of the premises, instead of merely embellishing them, is not plant, except in the rare case where the premises themselves are plant, like the dry dock in Barclay Curle or the grain silo in Schofield v Hall'.
The items in the Scottish and Newcastle case on which capital allowances had been claimed were part of the setting, but they were not part of the premises.
Lord Cameron said:
'the problem which the Commissioners were called upon to solve was one concerned with a "service industry". I think this factor is important because the question of what is properly to be regarded as plant can only be answered in the context of the particular industry concerned and possibly in light also of the particular circumstances of the individual taxpayer's own trade.'
Later, he added:
'I think that the Commissioners rightly applied their minds to the proper initial and fundamental questions which they had to answer - the meaning of plant in its statutory context and as applicable to the trade carried on by the taxpayer'.