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2014 (1) TMI 871 - AT - Income TaxDenial of depreciation on plant and machinery u/s 32 of the Act – Held that:- There is no benefit which the assessee derived from its sister-concern as a quid pro quo for allowing the user of such asset - The mere facts that the assessee utilized its funds or obtained a loan in its own name for acquiring the asset and also showed it in its books of account, would not change the consequence of the non- granting of depreciation in any manner when the essential fact prevails that the asset was, in fact, utilized by the sister concern for its own business purpose - It was candidly admitted that the return for the last year was processed u/s 143(1) in a summary manner and the case was not taken up for scrutiny assessment - the assessee is not entitled to depreciation as per law, the principle of consistency in the given circumstances cannot be followed as obviously there can be no estoppel against the provisions of the Act – Decided against Assessee. Addition made on account of difference in valuation of closing stock – Held that:- The invoices showing the sale of defective goods at a lower price in succeeding year were not placed before the AO - when the assessee is following 'Cost or market price whichever is less' as method for valuation, then the assessee cannot be compelled to value such stock at the cost price, if the market value of such stock is less - it is the market value which is required to be considered for determining the overall profit - it would be in the fitness of things if the order on this issue is set aside and the matter is remitted to the file of AO – Decided partly in favour of Asessee.
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