9911796707
|
Home
Issues involved: Appeal against the order of CIT(A) regarding set off of depreciation from a previous assessment year against income from other sources for the years 2004-05 and 2005-06.
Summary: The Revenue appealed against the CIT(A)'s decision allowing set off of depreciation from the assessment year 1996-97 against income from other sources for the years 2004-05 and 2005-06. The Revenue contended that the Tribunal's decision in the case of Southern Travels vs. Asstt. CIT was applicable, which stated that unabsorbed depreciation must be carried forward and set off against profits and gains of the same business. However, the assessee argued that the amended section 32(2) of the Finance Act, 2001, allowed for set off of unabsorbed depreciation against income from any other head. The original section 32(2) of the IT Act, 1961 was amended by the Finance Act, 2001, restoring the provision that unabsorbed depreciation could be set off against income from any other head. The judgment of the Supreme Court in the case of CIT vs. Virmani Industries (P) Ltd. was cited, which supported the allowance of set off of unabsorbed depreciation against income for the relevant assessment years. The Tribunal held that the amended provision of section 32(2) from the Finance Act, 2001 was applicable to the assessment years 2004-05 and 2005-06. As per the amended section, the assessee was entitled to set off the unabsorbed depreciation from the assessment year 1996-97 against income from other sources for these two assessment years. Therefore, the appeals of the Revenue were dismissed. In conclusion, the Tribunal upheld the CIT(A)'s decision to allow the set off of depreciation from a previous assessment year against income from other sources for the years 2004-05 and 2005-06.
|
