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2014 (11) TMI 679 - AT - Income TaxDepreciation on asset disallowed Delhi Metro Project - Ownership of the assessee - Asset owned by NBCC or assessee company Held that:- CIT(A) rightly was of the view that assessee has purchased office space in the building from NBCC and some portion of 5th floor was acquired from CRISIL - full price of the property has been paid though the ownership is yet to be in the name of DMRC Ltd. - The office space occupied by DMRC was earmarked for the Government and the same was provided to DMRC by the Government of India due to DMRCs social objectives and also due to the fact that DMRC is a joint venture of Government of India - it is not very clear from the assessment order as to why the appellant is not entitled for depreciation on the building - the transaction was between the DMRC and Government which is also a shareholder of DMRC assessee is entitled for depreciation on the principles of part performance by virtue of provisions of section 2(47)(v) the order of the CIT(A) is upheld Decided against revenue. Depreciation on installation of electric sub-station at ISBT Asset owned by Delhi Vidyut Board or assessee company Held that:- CIT(A) rightly was of the view that there is no doubt that the expense on electric sub-station was incurred wholly and exclusively for the purpose of business - assesseeis entitled to claim the entire expense as revenue relying upon CIT Vs Saw Pipe Ltd. [2007 (1) TMI 101 - DELHI HIGH COURT] expenses on electric sub-station was incurred wholly and exclusively for the purpose of business - the assessee was entitled for deduction of entire expenditure, though, it claimed only depreciation treating the expenditure in capital field Decided against revenue. Misc. income not offered for taxation disallowed Held that:- CIT(A) rightly held that the assessee had capitalized two sectors of their construction projects namely Vishwavidyala Kashmere Gate sector and Inderlok Rithala sector - In the subsequent assessment year the appellant had capitalized two more sectors Kashmere Gate Centre Secretariat sector and Barakhamba Dwarka sector - this method of accounting has consistently been followed by assessee - the interest on advance pertained to construction work the order of the CIT(A) is upheld Decided against revenue. Excess provision of leave encashment u/s 43B(f) disallowed Held that:- CIT(A) rightly deleted the addition observing that AO failed to note that the assessee had not debited this amount in their profit and loss account but instead capitalized the expenses - Since, the assessee had not claimed this as an allowable deduction, the provision of sec. 43B had no application in the case of leave encashment capitalized by the assessee Section 43B comes into play only when deduction is claimed by the assessee in its computation u/s 28 though not paid during the year - Decided against revenue.
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