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2015 (9) TMI 906 - AT - Income TaxRevision u/s 263 - A.O. has not examined whether the depreciation is admissible under section 32(iia) as additional depreciation can be claimed only on assets installed during the relevant previous year - Held that:- If the assessee has not used the new assets for more than 180 days, the assessee is only eligible to claim additional depreciation at 50%. The statute provides 50% for the year under consideration in which it is put to use. The statute does not provide anything to claim additional depreciation in the subsequent year. Therefore, the Assessing Officer, without applying his mind, simply accepted the explanation given in the Note by the assessee and allowed the claim of the assessee. Therefore, the order passed by the Assessing Officer is erroneous and prejudicial to the interests of Revenue. In our opinion, the ld. CIT has rightly invoked section 263 of the Act. Therefore, we confirm the order of the ld. CIT on this issue. - Decided against assessee. Set off of brought forward capital loss and benefit under section 112 - A.O. has not examined whether the units sold by the assessee would fall within the definition given in Explanation to section 115AB and whether the proviso to section 112 would apply to the assessee as the said proviso would appear to apply only to those shares, bonds or units which are eligible for indexation benefit under second proviso to section 48 read with third proviso thereof - Held that:- In the assessment order, the Assessing Officer has not examined the issue at all and simply allowed the claim of the assessee. The order passed by the ld. CIT is valid in view of the inadequate enquiry by the Assessing Officer since the Assessing Officer has not examined the applicability of proviso to section 112 of the Act and also not examined whether the Sundaram Bond Saver is a unit as per section 10(23D) of the Act. Therefore, we are of the opinion that the Assessing Officer has failed to discharge his duty to examine the issue. Accordingly, the ld. CIT has rightly invoked section 263 of the Act on this issue.- Decided against assessee. Non consideration of disallowance of expenditure relating to exempt income as provided in section 14A - Held that:- The Assessing Officer has not examined the issue at all and simply allowed the claim of the assessee. Therefore, we are of the opinion that the ld. CIT has rightly invoked section 14A of the Act - Decided against assessee. Eligibility for set off of brought forward capital loss nor benefit under section 112 - Held that:- Carried forward capital loss relates to long term capital loss, which cannot be set off against the short term capital gain in the financial year. In view of the above, we direct the Assessing Officer to examine the details of set off of brought forward capital loss keeping in view of the provisions of section 74(1)(b) of the Act and decide the issue de novo. In so far as benefit under section 112, we find that before the Assessing Officer, the assessee has not filed the above certificate and copies of registration with SEBI. Accordingly, it is fresh evidence, which was produced before the ld. CIT(A), which is the basis for his conclusion. In our opinion, it is appropriate to remit the issue to the file of the Assessing Officer for fresh consideration. Since the set off of brought forward capital loss and benefit under section 112 of the Act are interlinked, we set aside the order passed by the ld. CIT(A) on these issues and, in view of the above findings, the Assessing Officer is directed to decide the issues de novo in accordance law after giving opportunity to the assessee - Decided in favour of revenue for statistical purposes. Disallowance u/s 14A - CIT(A) restricted the disallowance to 2% - Held that:- We find that the assessment year under consideration is 2004-05 and therefore, the provisions of Rule 8D r.w.s. 14A has no application since the said provisions of Rule 8D has been notified with effect from 24.03.2008 and applicable with effect from the assessment year 2008-09. Therefore, the ld. CIT(A) has rightly followed the decision of the Tribunal and restricted the disallowance to 2% of the exempt income. In view of the above, we find no infirmity in the order passed by the ld. CIT(A) - Decided against revenue.
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