Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (5) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (5) TMI 1673 - AT - Income TaxHigher rate of depreciation on Trucks and Trailers - Disallowance on account of alleged excess depreciation claimed at the rate of 30% instead of allowable depreciation of 15% on Trucks and Trailers - HELD THAT:- Appellant has been consistently claiming higher rate of depreciation of 30% in the preceding assessment years as well as in the succeeding assessment years, wherein the results have not been disturbed and the higher rate of depreciation in scrutiny assessments in these year's has been duly allowed by the department. Once the appellant is consistently claiming higher depreciation which has also been allowed by the department, hence in opinion to disturb it in a particular year, the claim of the appellant for higher depreciation would not be lawful and thus the higher claim of depreciation @ 30% claimed by the appellant during the assessment year under consideration is held to be a genuine claim. The Central Board of Direct Taxes in a circular number 652 dated 14-6-1993 wherein it has clarified that even if the assessee is using the motor lorries in its own business of transportation of goods, then also higher rate of depreciation would be allowed to them. In view the CBDT circular as well as the consistent claim of the appellant for higher rate of depreciation in all the years throughout, we delete the disallowance so done by the Ld. A.O. and sustained by the Ld. CIT(A). Thus, the higher rate of depreciation at 30% is allowed to the appellant and accordingly, this ground of appeal is allowed. Disallowance of Service Tax liability u/s 43B - tax liability unpaid before the due date of filling of return u/s 139(1) - HELD THAT:- Since the provisions of Service Tax rules, prior to its amendment which was applicable from 1-4-2011, stated that the service tax would be payable only on receipt of the same from the service receiver, hence how could the appellant pay the same when the service tax was not received from the service recipient, and therefore the same cannot be added u/s 43B, as it never became due to be paid to the service tax department as the same was not even realised from the appellants service recipients. The intention of the revenue in inserting the provisions of the section 43B was that the assessee should not take benefit from the indirect taxes which it receives and never pays to the government, and also claim a deduction of the same in arriving at the taxable income, hence a deduction of the same was to be allowed only on actual payment of those taxes, duties to the Government. Disallowance done u/s 43B for service tax payable which never became due to be paid as per Service Tax Rules cannot be disallowed u/s 43B as was done by the Ld. A.O. and hence the disallowance is deleted. Accordingly, the 2nd ground of appeal is allowed. Nature of expenses - office repair and maintenance - revenue or capital expenditure - HELD THAT:- . Since by incurring these expenditures on wooden panelling, electric wiring, fall ceiling, etc. no new asset which belong to the assessee came into existence, whereby it could claim depreciation u/s 32 of the Income Tax Act, of which it was an owner, hence we feel that the assessee has rightly claimed these expenditures as revenue expenditure and not capitalised in its fixed assets chart. If the assessee would have capitalised these expenditures, then the question would have arisen, since it was not an owner of these assets, then how depreciation would have been allowed to the assessee firm. Further the CIT(A) based on the findings of the Ld. A.O. confirmed the additions without point out any adverse opinion of his in doing so and without averting to the facts and case laws relied by the assessee. The amount claimed as revenue expenditure under the head ‘office repairs and maintenance’ allowed.
|