In the result, the appeal filed by the Revenue is dismissed

Bench: Shri R.K. Panda & Shri Challa Nagendra Prasadassessment Year: 2012-13 Acit, Vs. Uttaranchal Jal Vidyut Circle-2, Nigam Ltd., 13-A, Subhash Road, Ujjwal, Maharani Bagh, Uttarakhand. Gms Road, Dehradun. Pan: Aaacu6672R (Appellant) (Respondent) Assessee By : Dr. Rakesh Gupta, Advocate & Shri Somil Aggarwal, Advocate Revenue By : Smt. Poonam Sharma, Sr. Dr Date Of Hearing : 22.12.2021 Date Of Pronouncement : 24.12.2021 Order Per R.K. Panda, Am: This Appeal Filed By The Revenue Is Directed Against The Order Dated 29Th December, 2016 Of The Cit(A), Dehradun, Relating To Assessment Year 2012-13. 2. The Only Effective Ground Raised By The Revenue Reads As Under:- “1. The Ld.Cit(A) Has Erred In Law & On Facts By Allowing Depreciation On Assets For Which The Actual Cost As Per Section 43(1) Of The Income Tax Act, 1961 Was Nil. 2. The Order Of The Ld.Cit(Appeals) Be Set Aside & That Of The Assessing Officer Be Restored.”

disallowing depreciation is not as per law. As per settled accounting principles, every rupee invested in the business has a cost. The cost of borrowing from the bank is known to the business depending on the rate of interest but that does not mean that the capital introduced in the form of shareholders fund has no cost. In the present