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2018 (1) TMI 1552 - AT - Income TaxRevision u/s 263 - MAT Computation - higher depreciation on the Energy Saving Equipments as well as pollution control equipments - HELD THAT:- Addition on account of excess stock found during the course of survey proceedings in the normal computation of income. However, the tax was charged on the book profit u/s 115JB of the Act computed and therefore, even if the claim of higher/additional depreciation is disallowed there will be no effect on the tax liability as the AO has computed the total income as per the provisions of Section 115JB and charged MAT on the same. Therefore, we find that the claim of higher depreciation on the Energy Saving Equipments as well as pollution control equipments is not going to effect the Revenue when the income of the assessee was assessed u/s 115JB and MAT was charged. Even if the claim was disallowed if the higher depreciation claim was disallowed the tax liability under MAT was still higher than the normal computation. It is settled proposition of law the Commissioner can invoked the provision of Section 263 only when the twin conditions being the order of the AO is erroneous as well as prejudicial to the interest of the Revenue are satisfied. In the case in hand for the sake of argument even if the order of the AO is considered as erroneous but the same is not prejudicial to the interest of the Revenue so far as the claim of higher depreciation is concerned as the income of the assessee would be computed u/s 115JB and the tax liability under MAT is still more than the normal computation of income. DR has fairly admitted this fact that even after disallowance of the claim of higher depreciation the tax liability under MAT would be higher than the normal computation. Further, this issue of higher/additional depreciation is not recurring in nature and limited to the year under consideration. We set aside the impugned order passed u/s 263 - Decided in favour of assessee.
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