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2019 (9) TMI 606 - AT - Income TaxAdditional depreciation - production/manufacturing of new and marketable article.whether assessee is a civil contractor and therefore does not qualify for the addition depreciation? - AO has denied the claim of additional depreciation on the ground that the assessee is not engaged in the production or manufacture of articles or things but the assessee is doing contractual civil work - CIT-A allowed the claim - HELD THAT:- The assessee is not carried out any activity of construction or development of projects but the assessee is in the activity of converting the stone blocks into aggregate which is used in the construction unit. Therefore, the assessee is not a civil contractor but supplying the construction material to other companies engaged in the construction/infrastructure activity. Once the activity of the assessee is converting the large stone blocks into aggregate which is after undergoing the process of crushing then the said activity is production/ manufacturing of a new article or thing which is different/distinct from input. The outcome of the process carried out by the assessee is a new marketable product/ article or thing and therefore, the assessee is adding the value to the raw material used and converting the same into a marketable article. No error or illegality in the order of the ld. CIT(A) allowing the claim of additional depreciation on the new plant and machinery purchase and used by the assessee for the purpose of production and manufacturing. - Decided against revenue.
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