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Income Tax Appellate Tribunal, BANGALORE BENCHES “ A ” BENCH: BANGALORE
Before: SHRI A.K. GARODIA & SHRI PAVAN KUMAR GADALE
O R D E R
PER SHRI PAVAN KUMAR GADALE, JM :
The assessee has filed an appeal against the order of Commissioner of Income Tax (Appeals), Bangalore passed under Section 143(3) and 250 of the Income Tax Act, 1961.
At the time of hearing, the learned Authorised Representative submitted that the additional ground of appeal has been filed in respect of claim and has not pressed the original grounds of appeal filed along with Form 36 and made endorsement. Accordingly the original grounds of appeal are treated as not pressed and dismissed and the additional ground of appeal is as under :
3. The Brief facts of the case of the assessee are that the assessee is engaged in the marketing and presales support services to Sandvine Inc. and filed the Return of Income for the Assessment Year 2014-15 on 29.11.2014 with total income of Rs.1,37,460 after claiming deduction under Section 10AA of the Act. Subsequently, the case was selected for scrutiny and Notice under Section 143(2) and 142(1) of the Act were issued. In response, the learned Authorised Representative of the assessee appeared from time to time before the Assessing Officer and submitted the details. Whereas the Assessing Officer has made disallowance in respect of excess claim under Section 10AA of the Act of Rs.17,79,826 and disallowed the additional depreciation on the computers as the assessee is in the business of marketing and presales support services to Sandvine Inc. and is not engaged in the business of manufacturing, production of an article or thing. Hence the assessee is not entitled for additional depreciation under Section 32(i)(iia) of the Act and disallowed Rs.48,91,761 and made addition of payment of technical services for non- deduction of tax Rs.6 lakhs and assessed the total income of Rs.74,16,077 and passed the order under Section 143(3) of the Act dt.21.12.2016. Aggrieved by the order, the assessee filed an appeal with the learned CIT(Appeals) and whereas the learned CIT(Appeals) has granted relief on claim of deduction under Section 10AA of the Act but confirmed the disallowance of excess claim of depreciation on computers as computers does not come under the category of plant and machinery and partly allowed the appeal. Aggrieved by the learned CIT(Appeals) order, the assessee has filed an appeal before the Tribunal.
At the time of hearing, the learned Authorised Representative has pressed only the additional ground of appeal
and submitted that any disallowance of excess depreciation under Section 32(i)(iiA) of the Act has to be allowed as deduction against the Business profits of Eligible unit under the provisions of Section 10AA of the Act and supported the argument with evidences in the Paper Book and judicial decisions. Contra, the learned Departmental Representative supported the order of learned CIT(Appeals).
5. We heard the rival contentions and perused the material on record. Prima facie, the only disputed issue argued by the learned Authorised Representative in respect of disallowance of excess additional allowance of depreciation on computers disallowed under Section 32(i)(iia) of the Act be allowed as deduction against the business profits under Section 10AA of the Act. The learned Authorised Representative vehemently submitted that the assessee has accepted the disallowance of additional depreciation and also filed the additional ground of appeal for allowing deduction against the business profits of eligible SEZ unit under Section 10AA of the Act. We found the submissions of the learned