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2014 (2) TMI 1114 - ITAT MUMBAIDisallowance of the additional depreciation u/s 32(1)(iia) of the Act - Held that:- The decision in Deputy Commissioner of Income-tax, Circle 3(1), New Delhi Versus Cosmo Films Ltd.[2012 (9) TMI 281 - ITAT DELHI] followed - The additional benefit in the form of additional allowance u/s 32(1)(iia) is one time benefit to encourage the industrialization - This additional benefit is to give impetus to industrialization and the basic intention and purpose of these provisions can be reasonably and liberally held that the assessee deserves to get the benefit in full when there is no restriction in the statute to deny the benefit of balance of 50% when the new plant and machinery were acquired and use for less than 180 days - One time benefit extended to assessee has been earned in the year of acquisition of new plant and machinery - In section 32(1)(iia), the expression used is "shall be allowed" - Thus, the assessee had earned the benefit as soon as he had purchased the new plant and machinery in full but it is restricted to 50% in that particular year on account of period of usages - Such restrictions cannot divest the statutory right - Law does not prohibit that balance 50% will not be allowed in succeeding year - The extra depreciation allowable u/s 32(1)(iia) in an extra incentive which has been earned and calculated in the year of acquisition but restricted for that year to 50% on account of usage - The so earned incentive must be made available in the subsequent year - The overall deduction of depreciation u/s 32 shall definitely not exceed the total cost of plant and machinery - thus, the order is set aside and the authority directed to extend the benefit - Decided in favour of Assessee. Disallowance made u/s 14A of the Act - Held that:- The assessee had not claimed any exempt income - provisions of section 14A were applicable in that year and AO was entitle to make disallowance - But, he should not have invoked the provisions of Rule 8D - thus, the matter remitted back to the AO for fresh adjudication - Decided partly in favour of Assessee.
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