TMI Blog2021 (12) TMI 698X X X X Extracts X X X X X X X X Extracts X X X X ..... claim of depreciation cannot be disallowed, if it is established that the motorcars are actually owned by the assessee and used in its normal course of business, though, purchased in the name of the Directors. The assessee has also furnished evidence to show that payment for the purchase of motorcars was on assessee s account and the EMI for loan availed were paid by the assessee from the its bank account. Even, the motorcars have been shown as fixed assets in assessee s books of account - there was no reason for the AO to disallow assessee s claim of depreciation. In any case of the matter, the judicial precedents cited before us by learned Counsel for the assessee clearly say that even if vehicles are registered in the name of directors ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no. 4, 5 and 6 are on merits. 3. Briefly the facts are, the assessee is a resident company engaged in the business of manufacturing of grey fabrics. For the assessment year under dispute, assessee filed its return of income on 24.09.2015 declaring total income of ₹ 43,30,817/-. Subsequently, assessee filed a revised return on 13.09.2017 declaring income of ₹ 42,70,870/-. Assessment in case of the assessee was completed under section 143(3) of the Act vide order dated 07.12.2017 determining the total income at ₹ 43,58,500/-. Subsequently, learned PCIT on examining the assessment record of the assessee was of the view that the assessment order passed for the impugned year is erroneous and prejudicial to the interest of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... years and depreciation has been allowed on them in the earlier assessment years. He submitted, in the impugned assessment year, the assessee has claimed depreciation on the opening written down value (WDV). Therefore, once depreciation on the assets was allowed in the earlier assessment years, there is no scope for further examination by the AO in the impugned assessment year. Thus, he submitted, on merits also claim of depreciation and interest payment is eligible. Therefore, the assessment order cannot be held as erroneous and prejudicial to the interest of the revenue. In support of such contention, learned Counsel relied upon the following decision:- i. Commissioner of Income Tax v. Dilip Singh Sardarsingh Bagga (1993) 201 ITR 995 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first car purchased on 12.01.2010 the assessee had started claiming depreciation from assessment year 2010-11 itself. Similarly, for the second car purchased on 04.11.2012, the assessee is claiming depreciation from assessment year 2012-13. For the third car purchased on 15.07.2012, the assessee is claiming depreciation from assessment year 2013- 14. The depreciation so claimed and the interest expenditure on loan availed for purchasing the motorcars have been allowed in the earlier assessment years. It is a fact on record that in the impugned assessment year, the assessee claimed depreciation on the opening WDV. Therefore, once depreciation on the assets have been allowed in the preceding assessment years, the AO could not have disallowed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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