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Income Tax Appellate Tribunal, HYDERABAD BENCHES “B” : HYDERABAD
Before: SHRI S.S.GODARA & SHRI LAXMI PRASAD SAHU
This Revenue’s appeal for AY.2009-10 arises from the CIT(A)-5, Hyderabad’s order dated 20-12-2018 passed in case No.0013/2015-16/CIT(A)-5, in proceedings u/s.143(3) r.w.s.147 of the Income Tax Act, 1961 [in short, ‘the Act’]. Heard both the parties. Case file perused.
The Revenue has raised the following substantive grounds in the instant appeal:
“2.Whether, in view of facts and law, the Ld.CIT(A) is correct in allowing the additional depreciation without considering the fact that some assets are old and used.
3.Whether, in view of facts and law, the Ld.CIT(A) is correct in treating the re-opening as bad in law when Section 32(1)(iia) of the Income Tax Act, 1961 clearly stipulates conditions regarding claim of additional depreciation of any new machinery or plant (other than ships and aircraft) which has been acquired and installed after 31st March 2005. The capital work-in-progress as on 31-03-2008 was capitalized during the year relevant to A.Y.2009-10 and hence the plant and machinery were not ready for use till such capitalization. Therefore, put to use or ready to use till such time does not arise”.
Learned departmental representative vehemently contended during the course of hearing that the Assessing Officer had rightly disallowed the assessee’s additional depreciation claimed of Rs.2,44,40,168/- @20% on the capital work in progress of Rs.12,22,00,842/- in Plant & Machinery block. He emphasised the Assessing Officer’s reasoning vide order dt.03-03-2015 that since the assessee had not put to use any new asset during the relevant previous year, its impugned depreciation claim pertaining to Plant & Machinery already put to use in the earlier assessment years is not entitled for the depreciations in issue.
We have given our thoughtful consideration to the Revenue’s foregoing argument. We find no merit to accept the same. Hon'ble Madras high court decision in Brakes India Ltd. Vs. DCIT, Tax Appeal No.551/2013, dt.14-03-2007 has already reversed the tribunal’s order to this effect accepting the Revenue’s stand. We thus hold the assessee’s as entitled for the impugned additional depreciation claim qua assets already put to use as well. The same therefore could not have been formed the Assessing Officer’s reason to be the taxable income having escaped assessment thereby triggering Section 148/147 mechanism in motion. We thus find no merit in the Revenue’s instant sole substantive grievance as well as in the main appeal.
This Revenue’s appeal is dismissed.
Order pronounced in the open court on 11th January, 2021