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2020 (9) TMI 29 - AT - Income TaxDisallowance of interest expenses u/s 36(1)(iii) - HELD THAT:- Admittedly, the amount was borrowed dated 29th December 2010 in the immediate preceding year and the assessee claimed the interest expenses up to 31st March 2011 on such loan as revenue expenses in the FY 2010-11. But the same was disallowed by the AO on the reasoning that the asset was not put to use. On perusal of the order of the ITAT [2020 (1) TMI 953 - ITAT AHMEDABAD] we note that the acquisition of the assets was not for extension of existing business and therefore the interest paid thereon was allowed as deduction. Respectfully following the same, we set aside the finding of the learned CIT (A) and direct the AO to delete the addition made by him. Depreciation of depreciation - asset put to use for less than 180 days - HELD THAT:- The provisions of section 32 of the Act provides that the asset put to use for less than 180 days, meaning thereby 179 days or less, then such asset will be eligible for depreciation at the rate 50% of the actual rate of depreciation. The above working for the number of days, the asset was put to use comes out 180 days which is outside the purview of the proviso to section 32 of the Act. The above working as shown by the assessee was not disputed by the learned DR appeared for the revenue. In view of the above, we hold that the assessee is entitled for depreciation at the rate prescribed under the provisions of law. Accordingly we set aside the finding of the CIT (A) and direct the AO to delete the addition made by him. Hence the ground of appeal of the assessee is allowed. Disallowance of depreciation on vehicles - vehicles ready to use - HELD THAT:- Cars purchased by the assessee were ready to use as on the date of purchase i.e. prior to 28th September 2011. Accordingly, even if it is assumed that the vehicles were registered on 12th October 2011 then also the assessee is eligible for depreciation at the rate of 15% for the simple reason that the vehicles were ready to use. We hold that the assessee was eligible for depreciation at the rate of 15% on the value of the vehicles purchased during the year. Accordingly we set aside the order of the learned CIT (A) and direct the AO to delete the addition made by him. Hence the ground of appeal of the assessee is allowed.
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