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Income Tax Appellate Tribunal, “A” BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI S. JAYARAMAN
आदेश/ O R D E R
PER S. JAYARAMAN, ACCOUNTANT MEMBER:
The revenue filed this appeal against the order of the Commissioner of
Income Tax (Appeals)-8, Chennai in ITA No. 17/2006-07 dated 03.03.2017 for
the assessment year 2004-05.
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M/s. Mahaveer Safety Glass Pvt. Ltd., presently known as Fuso
Glass (India) Ltd., is engaged in the business of manufacturing of dealing in
glass. In the assessment made for the assessment year 2004-05, the AO
found that the assessee claimed additional depreciation u/s. 32(1)(iia) at Rs.
78,69,122/- and noted that it failed to furnish Form No. 3AA towards
additional depreciation claim with the return. When the assessee was asked
to show cause why the additional depreciation should not be disallowed, it
submitted the required report u/s. 32(1)(iia) , pleaded that it inadvertently
omitted to enclose with the return and the same may be condoned. The AO
refused to allow the additional depreciation stating that the required
compliance was a mandatory one and the assessee has failed to do so.
Aggrieved, the assessee filed an appeal before the CIT(A). The CIT(A) held
that admittedly, Form 3AA was filed in the course of assessment proceedings.
Following the Supreme Court decision in the case of CIT vs G.M. Knitting
Industries Pvt. Ltd., 376 ITR 456(SC) , the CIT (A) allowed the assessee’s
appeal. Aggrieved, the revenue filed this appeal with the following grounds:
“2. The CIT(A) erred in deleting the disallowance on the claim of additional depreciation u/s. 32(1)(iia) of Rs. 78.69 lakhs 2.1 The CIT(A) erred in not appreciating the contention of the AO that the provisions of section 32(1)(iia) is mandatory provision and it uses the words “.... no deduction shall be allowed” and hence the additional depreciation cannot be allowed as the assessee had failed to furnish the details in the prescribed format.
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2.2 The CIT(A) erred in accepting the claim of the assessee as the same is contrary to the provisions of third proviso to clause (iia) of sub-section(1) of section. 2.3 The CIT(A) erred in not appreciating that the assessee failed to furnish Form 3AA along with return of income as per Rule 5A of the Income Tax Rules and hence the AO is justified in making the disallowance on the claim of additional depreciation.”
We heard the rival contentions. The Hon’ble Supreme Court of India in
the case of CIT vs G.M. knitting Industries Pvt. Ltd., 376 ITR 456 held that
“Even if form 3AA (in which the report of an accountant is to be filed under rule 5A of the Income –tax Rules,1962) for claiming additional depreciation u/s 32(1) (iia) of the Income-tax Act,1961, was not filed along with the return of income but was filed during assessment proceedings before final order of assessment was made that would amount to sufficient compliance for grant of additional depreciation in terms of section 32(1) (iia) of the Act”.
Hence, the assessee is entitled for the additional depreciation. The order of
the CIT (A) does not require any interference. The Revenue’s appeal is
dismissed.
In the result, the Revenue’s appeal is dismissed.
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Order pronounced on Monday, the 27th day of November, 2017 at Chennai.
Sd/- Sd/- (एन.आर.एस .गणेशन) (एसजयरामन) (N.R.S. GANESAN) (S. JAYARAMAN) !या�यकसद"य/Judicial Member लेखासद"य/Accountant Member
चे�नई/Chennai, 0दनांक/Dated: 27th November, 2017 JPV आदेशक&)�त1ल2पअ3े2षत/Copy to: 1. अपीलाथ%/Appellant 2. )*यथ%/Respondent 3. आयकरआयु4त ) अपील(/CIT(A) 4. आयकरआयु4त/CIT 5. 2वभागीय)�त�न�ध/DR 6. गाड7फाईल/GF