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2019 (12) TMI 613 - AT - Income TaxAddition as rental income by adding security deposit - assessee has declared rental income only for six months and has not declared rental income for the balance six months - tenants did not pay the rent and raised dispute before the court - HELD THAT:- Since the tenants have filed suit before the Hon'ble High Court for recovery of security deposit, then the assessee could not have adjusted the security deposit towards it unrealised rent. We further find that in A.Y 2016-17, the assessee has included ₹ 63.36 lakhs in it profit and loss account after the decision of the Hon'ble High Court of Delhi. In our considered opinion, the action of the Assessing Officer is not acceptable and since the ld. CIT(A) has upheld the action of the Assessing Officer, both the lower authorities have erred in making the addition and sustaining the addition. Addition is unwarranted and deserves to be deleted. Accordingly, Ground No. 2 is allowed. Disallowance on account of depreciation on car and interest on car loan - allowable revenue expenses - HELD THAT:- Depreciation has been claimed by the assessee on the written down value of the asset which means that in earlier years, the asset was used for the purposes of business. Nowhere the Assessing Officer has brought any material evidence on record to suggest that there is a closure of business activities. On the contrary, we find that in furtherance of its business activities, the assessee has further advanced ₹ 65 lakhs towards land at Chandan Hola, Delhi which means that the assessee was, in fact, carrying out business activities during the year under consideration. The Hon'ble High Court of Delhi in the case of Capital Bus Service [1980 (2) TMI 69 - DELHI HIGH COURT] has held that the only condition for allowability of depreciation is that the business should not have been closed out once for all and that the assessee should demonstrate that hopes of the business being revived are alive and real. Assessee was in fact, engaged in furtherance of its business activities and, therefore, it cannot be said that the assessee has closed down its business once for all. Therefore, the assessee is eligible for claim of depreciation. Similarly, interest on car is also coming from earlier years as the money was borrowed in earlier years. Therefore, in our humble opinion, there cannot be any disallowance for want of any business activity as the assessee was very much engaged in its business activities. The Assessing Officer is accordingly directed to delete the addition
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