2016 (8) TMI 1430 - HC - Income Tax

Accumulation of income u/s 11(1)(a) - depreciation on the assets the cost of which has been fully allowed as application of income under section 11 in the past years - HELD THAT - Issue raised herein stands concluded against the appellant - revenue and in favour of the respondent assessee that by decision of this Court in CIT Vs. Institute of Banking Personnel Services 2003 (7) TMI 52 - BOMBAY HIGH COURT . In fact the impugned order of the Tribunal placed reliance upon the aforesaid decision of this Court to dismiss the revenue s appeal before it. In the above view as the impugned order has followed the binding decision of this Court no substantial question of law arises for our consideration.

Summary

Issues:
1. Appeal challenging order of the Income Tax Appellate Tribunal for Assessment Year 2008-09.
2. Questions of law regarding depreciation claim and carry forward of deficit on excess expenditure.

Analysis:
1. The appellant challenged the Tribunal's order regarding the depreciation claim of Rs. 7,60,79,804. The appellant argued that the Tribunal erred in upholding the Commissioner of Income Tax (Appeals) decision based on a previous court ruling, ignoring the Supreme Court judgment in Escorts Ltd. Vs. Union of India. The Supreme Court had held that double deduction cannot be presumed unless specifically provided by law in addition to normal deduction. However, the High Court noted that the issue was already settled in favor of the respondent in the case of CIT Vs. Institute of Banking Personnel Services. The Tribunal's decision was based on this precedent, and as such, no substantial question of law arose for consideration. Therefore, the High Court dismissed the appeal.

2. The second question of law involved the carry forward of deficit on account of excess expenditure. The appellant contended that allowing the carry forward would result in granting double benefits to the assessee, which is legally impermissible. The High Court observed that the issue had already been conclusively decided in favor of the respondent based on the precedent set by the court in a previous case. The Tribunal's decision to allow the carry forward of deficit was in line with this precedent. Consequently, the High Court held that no substantial question of law arose for consideration on this issue as well. Therefore, the appeal was dismissed with no order as to costs.