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2016 (2) TMI 393 - AT - Income TaxRevision u/s 263 - commission paid to the MD to be disallowed - Held that:- The terms of employment was already prescribed in the above resolution, which was for a period of five years with effect from Sept'01, 2007. Hence, the reappointment of the MD was with effect from 01/09/2007. The company can adopt the revised commission of 3% with effect from 01/09/2007 and not from the period 01/04/06 to 31/03/07. We find that the CIT's contention was right partially as the AO had not considered these points while completing the assessment. The assessee is allowed to claim the commission for this period only @ 1% not 3%. Considering the above observations, we dismiss the ground of appeal of the assessee. AO is, therefore, directed to allow the commission paid to the MD @ 1% of the net profit. Claim of depreciation on electrical installations @ 15% - Held that:- The definition of electrical fittings given are electrical wiring, switches, sockets, fans etc. These are electrical fittings which are independent in nature and it does not form part of any assets. Whereas in the present case the electrical installations which are different to electrical fittings as defined in the depreciation schedule in the IT Rules. These include line metering equipment, switch yard, HT motors and auto losses, cable work, lighting equipment etc. are installed as part of the plant & machinery. It cannot be separated from the plant & machinery. Hence, it has to be treated in line with the plant & machinery and the rate of depreciation of plant & machinery alone has to be adopted not of the rate of 'Furnitures and Fittings'. Considering the above discussion, we allow the grounds of the assessee. - Decided in favour of assessee Additional depreciation claimed on Air Pollution Equipment u/s 32(1)(iia) - Held that:- In the present case, the assessee had categorized the Air pollution equipment as special category assets and claimed accordingly. Since, it is categorized as special category and claimed 100% rate of depreciation, the assessee applied the special provision of claiming depreciation, as per the section 32(1)(iia)(D), it cannot again claim the additional depreciation. Even though it has not claimed 100% of the quantum of the value of assets due to the fact that the assets were acquired and utilized less than 180 days, it was eligible for only 50% of the rate of depreciation. Again, it cannot claim the additional depreciation u/s 32(1)(iia). Assessee also relied on the case of Cosmo Films Ltd. (2012 (9) TMI 281 - ITAT DELHI ). Reliance placed by the assessee on the said case is on the subject whether the assessee can claim the whole additional depreciation which is as incentive to the assessee, who are in the manufacturing sector and made investment on the plant & machinery. The same was restricted for the usage, which was installed and utilized for less than 180 days in the year of installation. Can the assessee claim the balance depreciation in the following year. It was decided affirmative. But in the present case, the facts are different, hence, the said case cannot be applicable to assessee. - Decided against assessee Disallowance of outstanding liability of leave encashment - Held that:- Following the consistent view taken by the Tribunal in assessee's own cases for earlier years, we find no justification to disallow the claim concluding the provisions made on account of leave encashment should be allowed although the liability may have to be quantified and discharged at a future date - Decided in favour of assessee
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