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2014 (4) TMI 397 - AT - Income TaxConfirmation of additional claim of depreciation – Held that:- Provisions of section 32(1)(iia) of the Act, do not requires that the P&M has to be put into use in the year in which it is acquired for the purpose of claiming AD - what is important and material is the year of acquisition in the case of ships or aircraft and the year of installation in the case of machinery or plant - If the installation of a plant is spread over more than a year, the relevant year for the grant of allowance would be the year in which the installation is completed – Relying upon Commissioner Of Income-Tax Versus Surama Tubes Pvt. Limited [1991 (1) TMI 9 - CALCUTTA High Court] - Till a machine is not assembled in a manner that it could be used to manufacture, it cannot be held that it had been installed - Mere purchasing or shifting it to factory premises is not enough. It is a common phenomenon that in big projects, installation of machinery takes very long time because of the sheer volume of the work to be carried out - If an assessee is not successful in installing P&M in one year and carries forward the installation work in subsequent year/years it cannot be denied any benefit on the ground that it had acquired the P &M in earlier year - The intent of the legislature was to attract investment – the production started from 01. 01. 2006 - Before that fabrication and completion of P&M was going on - Treatment given by the assessee in the books of accounts to the P&M was in accordance with the Accounting Standards (AS)and the AO/FAA has not denied the fact that the assessee was following AS - assessee was entitled to claim AD @of 10% - the order of the FAA is reversed – Decided in favour of Assessee.
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