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2016 (4) TMI 414 - AT - Income TaxTaxability of unutilized accumulated amount - selection of assessment year - Held that:- The returns of income filed by the assesseee for the A.Ys. 2005-06 & 2006-07 marked as 'E' & 'F', (which is enclosed) that the assesseee carried forward the accumulation as unutilized funds for the AY 1999-00, which was not at all spent. However, before the CIT(Appeals), it was taken a plea that it was spent in AY 2005-06 and 2006-07 as per the revised computation filed before the AO. Further, it was taken a plea that it was an inadvertent mistake and submitted that in view of change of circumstances of the case, it was invested in land allotted by CMDA vide its letter dated 19.3.2009. When the department vide a letter dated 10.1.2013 raised a question on application of income, the letter dated 6.2.2013 from CMDA was filed by the assessee to prove that the assessee is intending to purchase the land. However, if the assesseee is bona fide, the assessee should have produced the order issued from the CMDA on 19.3.2009 and the reason for delay in filing the said letter for such a long period till the Assessing Officer making the assessment for the assessment year 2010-11 is not acceptable. There exists no reason for such delay. We are not in a position to accept the submission of the assesseee. Accordingly, we are inclined to reverse the order of the CIT(Appeals) and restore that of the AO. - Decided in favour of revenue Allowance of depreciation when the costs of acquisition of assets were treated as application of income for the purpose of claiming exemption u/s.11 - Held that:- In this case, the cost of the asset was allowed u/s 11 of the Act as application income since the assessee is a charitable institution entitled for exemption u/s 11. Therefore, the cost of the asset becomes NIL. When the cost of the asset becomes NIL, there is no question of allowing any depreciation. If the depreciation is allowed then it would amount to double deduction. Therefore, this Tribunal is of the considered pinion that provisions of section 11 of the Act will override section 32. In other words, if the assessee claims exemption u/s 11 under Chapter III of the Act, it cannot claim depreciation u/s 32 of the Act. Therefore, we are unable to uphold the order of the CIT(A). Accordingly, the order of the CIT(A) is set aside and that of the Assessing Officer is restore - Decided in favour of revenue
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