ITO (E), NEW DELHI vs. M/S. VISHWESHRAIYA EDUCATIONAL TRUST, DELHI

None was present for the assessee as well as the Revenue. I find that pursuant to the mandate of section 268A, the CBDT has issued Circular No. 21 of 2015 dated 10.12.2015 with retrospective effect, revising the monetary limit to Rs.10,00,000/- for not filing appeals before the Tribunal. I further find that as the tax effect involved in the instant appeal is less than Rs.10,00,000/-, the extant appeal is not maintainable.

From para 10 of the above Circular it is palpable that the Instruction is applicable to the pending appeals also with retrospective effect and there is a clear-cut direction to the Department to withdraw or not press such appeals filed before the ITAT wherein tax effect is less than Rs.10,00,000/-. Going by the prescription of the aforenoted Circular, I am of the view that the Revenue should have either not filed the instant appeal before the Tribunal or withdrawn the same as the tax effect in this appeal is less than the prescribed limit for not filing the appeals. Ex conseqeunti, I dismiss the instant appeal.

Even otherwise, it is noticed that the issue raised in this appeal about the granting of depreciation in addition to the allowance for purchase of assets as application, has been decided by the Hon’ble Delhi High Court in the case of DIT(E) vs. Indraprastha Cancer Society (2014) 112 DTR 345 (Del), holding that claim for depreciation shall be allowed as per the principles relating to commercial accountancy while computing business income, in addition to the amount spent on purchase of capital asset being treated as application of income. It is further observed that the Finance (No.2) Act, 2014 has inserted section 11(6) w.e.f. 1.4.2015 providing that no depreciation on an asset can be allowed once its purchase has been treated as application of income. Since the year under consideration is AY 2010-11, I am satisfied that the case is not hit by the newly inserted section 11(6). I, therefore, uphold the impugned order.