Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (6) TMI 1396 - AT - Income TaxDisallowing depreciation on Air and Water Pollution Control Machine - Assessee has claimed depreciation at 100% of the actual cost and not on the valuation as per valuation report - principle of consistency - HELD THAT:- While analyzing the entry we have to see the description of plant as a whole and not the description of various items – small and big which go to constitute the plant. We have no doubt that the plant installed was the plant of air and water pollution control which was admittedly put to use after 30th September. On the very same plant and machinery the very same A.O. has allowed balance depreciation of 50% in A.Y.2014-15 and that order is final. In view of this fact, we see no reason for lower authorities to disallow depreciation for A.Y.2013-14 the year in question. Here there is no question of arguing that principle of resjudicata is not applicable and hence the finding of A.Y.2014-15 cannot be said to be binding in A.Y.2013-14. On the same plant and machinery the same A.O. in one year allows depreciation at the prescribed rate of 100% and in another year on the same machinery the same A.O. totally disallows the depreciation. This is most inconsistent, and illogical. Applying the principle of consistency as is firmly established by the decision in the case of Radhasoami Satsang [1991 (11) TMI 2 - SUPREME COURT] and Quest Investment Advisor Pvt. Ltd. [2018 (7) TMI 479 - BOMBAY HIGH COURT] the depreciation as claimed by the Assessee in the year in question i.e. A.Y.2013-14 is allowable. Disallowing Selling and Distribution Expenses - A.O. considered the expenses at higher side, therefore disallowed to the extent of 2.95% - CIT-A restrict the disallowance at 1% of such expenses - HELD THAT:- In the present case it is worth noting that, higher commission than what is claimed in this year has been allowed in earlier and later years - no justification to make disallow of 1% and thereby retain addition - CIT(A) has specifically mentioned that he has perused relevant copies of accounts and bills etc. and has not found any defect in the accounts. Similarly the department has always accepted the accounts which are duly audited. No defect of any nature has been pointed out or proved. The claim of the Assessee, in our view, cannot be said to be unreasonable. There was neither any material or basis before ld CIT(A) to make an adhoc disallowance of 1% of expenses - Decided in favour of assessee.
|