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2015 (10) TMI 394 - AT - Income TaxQuarry Development Expenses - revenue v/s capital expenditure - Held that:- In the instant case, details of expenditure clearly shows that the expenses have not resulted in creation of any assets nor have they resulted in any enduring benefit to the appellant. The AO has not brought any facts on record to show as to which expenses debited under the head of 'quarry development' were capital in nature. These expenses are in the nature of salaries, wages, fuel, power, rent, and other expenses for removal of overburden etc. which cannot be said to be in the nature of capital expenditure. The Hon'ble Calcutta High Court in the case CIT Vs. Katras Jharia Coal Co. Ltd (1978 (9) TMI 37 - CALCUTTA High Court ) held that expenses for removal of overburden were not for acquiring any right of properties and will also not result in any enduring benefit and therefore are revenue in nature. Since there is no material change in facts and circumstances in the appeal under consideration. No reason for deviating from the findings given by the respective CIT(Appeals) for the Asstt. Years 2007-08, 2008-09 and 2009-10 respectively as stated above. Therefore, addition made by the AO is deleted and the ground of appeal of appellant company is allowed on this issue Depreciation on the closed units for last 8 years - Held that:- If some of the units of the assessee are closed, other units are certainly working and the depreciation is to be allowed on the entire block of assets of the plant & machinery and not only individual plant and machinery of each unit of the assessee - In the present case although the production has not been carried out in the years under consideration but the assets are kept as a stand by for the whole year. Moreover, although the production is suspended but the other activities of the units are being carried out. In such circumstances, find that the AO was not justified in disallowing the depreciation on the assets of these units. The additions made by him are, therefore, directed to be deleted - Decided in favour of assessee.
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