MAHASHE RESORTS PRIVATE LIMMITED,SHIMLA vs. DCIT CC SHIMLA, SHIMLA
What did the Tribunal hold?
The Tribunal held that Section 115BBE is prospective in nature and does not apply to Assessment Year 2017-18, following the decision of the Rajasthan High Court in Deepak Maratha and various coordinate benches of the Tribunal. Consequently, Ground No. 4 of the appeal was allowed. Regarding Ground No. 1, the Tribunal found no reason to disallow depreciation on the amount that was declared for investment in fixed assets and capitalized, especially after holding that Section 115BBE is not applicable for AY 2017-18. Therefore, Ground No. 1 was also allowed. Grounds No. 2 and 3 were considered consequential to the above grounds and thus stood allowed without separate adjudication. The appeal of the assessee was allowed in its entirety.
What were the facts?
The assessee, Mahashe Resorts Private Limited, is in appeal against the order of the CIT(A)-3, Gurgaon, dated 16/07/2025, for Assessment Year 2017-18. A survey under Section 133A of the Income Tax Act, 1961, was conducted. During the survey, the assessee admitted unexplained income of Rs. 80,00,000/- as unexplained capital investment for interior and exterior renovation of Eutopia Resort. This amount was offered as income in the return, capitalized, and depreciation of Rs. 4,00,000/- was claimed. The Assessing Officer (AO) taxed the Rs. 80,00,000/- under Section 69 read with Section 115BBE and disallowed depreciation. The CIT(A) confirmed the AO's order. The total amount in dispute is Rs. 80,00,000/- plus the disallowed depreciation.
What were the issues?
The Tribunal had to decide the following questions: 1. Whether the Assessing Officer erred in disallowing depreciation of Rs. 4,00,000/- (mixed question of law and fact, concerning the capitalization of expenses and claim of depreciation). 2. Whether the Assessing Officer erred in treating the declared income of Rs. 80,00,000/- as unexplained income under Section 69 (question of law, concerning the nature of declared income). 3. Whether there was double taxation of the surrender amount of Rs. 80,00,000/-, which was already credited to the Profit & Loss account and offered to tax (question of fact and law, concerning the computation of income). 4. Whether the Assessing Officer erred in applying Section 115BBE to the surrendered income of Rs. 80,00,000/- (question of law, concerning the applicability of Section 115BBE). Assessee's contentions: - Section 115BBE does not apply to AY 2017-18, as it is prospective in nature, relying on the Rajasthan High Court decision in Deepak Maratha (Civil Writ Petition 3625/2020). - The declared amount of Rs. 80,00,000/- was for unexplained capital investment, correctly capitalized, and depreciation was rightly claimed. Revenue's contentions: - The Revenue relied on the orders of the lower authorities.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
आदेश/Order PER VIJAY VARMA, A.M: This is an appeal filed by the Assessee against the order of the Ld. CIT(A)-3, Gurgaon dt. 16/07/2025 for the Assessment Year 2017-18. 2. In the present appeal Assessee has raised the following grounds:
Disallowance of Depreciation of Rs. 4,00,000/-The Learned Assessing Officer (AO) has erred in law and on facts in disallowing depreciation of Rs. 4,00,000/-.
Treating Declared Income as Unexplained Income u/s69. The AO
The order continues below.
Read the full judgment
A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.
The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.
More judgments on Section 133A
- ACIT Central Bilaspur, Bilaspur vs Arun Kumar Agrawal, SaktiITSSA 26/RPR/2025[2018-19]Status: Disposed21 Oct 2026AY 2018-19
- Venish Vinodray Lalani, Rajkot vs Income Tax Officer, MorbiITA 197/RJT/2026[2019-20]Status: Disposed19 Oct 2026AY 2019-20
- Ranchhodbhai Kurjibhai Kakadiya, Rajkot vs Income Tax Officer, Ward-1(1)(1), RajkotITA 553/RJT/2025[2019-20]Status: Disposed16 Oct 2026AY 2019-20
- Amr Infrastructures, Hyderabad vs DCIT., Central Circle-2(1), HyderabadITA 818/HYD/2025[2020-21]Status: Disposed16 Oct 2026AY 2020-21
- Shri Vikaskumar Macwan, Nadiad vs Dc/ACIT Central Circle 3, VadodaraITA 2022/AHD/2026[2020-21]Status: Disposed13 Oct 2026AY 2020-21
Recent GST High Court judgments
Search GST case law →- Tvl. Jeyarani Shopping Centre vs. The Deputy State Tax Officer -1/The Deputy Commercial Tax OfficerMadras · 14 Oct 2026
- Rohan Tanna vs. Directorate General Of Goods And Services Tax IntelligenceChhattisgarh · 14 Oct 2026
- Dipak Saikia vs. The Union Of INDIA And 4 OrsGauhati · 14 Oct 2026
- Saraswati Phukan vs. The Union Of INDIA And 4 OrsGauhati · 14 Oct 2026
- Sanjay Maheshwari vs. Union Of INDIA & Ors.Delhi · 14 Oct 2026
