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2021 (5) TMI 824 - AT - Income TaxDepreciation on maintenance of Road - AO allowed depreciation @ 10% instead 25% as claimed by the assessee - availability of depreciation to the assessee whether it is to be allowed keeping the right to collect toll fee as intangible assets or it to be treated as building or plant & machinery - HELD THAT:- As relying on North Karnataka Expressway Ltd. [2014 (11) TMI 351 - BOMBAY HIGH COURT] and ACIT vs. Progressive Construction Ltd. [2017 (3) TMI 1167 - ITAT HYDERABAD] we hold that the assessee is eligible for depreciation @ 25% as claimed by the assessee. Thus, Ground of appeal No. 1 raised by the assessee is allowed. Disallowance made by the Assessing Officer with regard to provision made for maintenance of the roads - HELD THAT:- As assessee took us through the chart wherein it was mentioned that the maintenance expenditure to be incurred in five years was ₹ 60.34 crore, project operations were started on 09.08.2011 and estimation of maintenance expenditure was estimated to ₹ 12.07 crores and being not having full year operations of the project, provision was created for only one quarter i.e. ₹ 12.07 crore/4 i.e. ₹ 3 crore. Reliance is placed upon the judgment of Hon'ble Supreme Court in M/s. Rotork Controls India (P.) Ltd. vs. CIT [2009 (5) TMI 16 - SUPREME COURT] Further, reliance was placed upon the judgment of Hon'ble Supreme Court in the case of Bharat Earth Movers vs. CIT [2000 (8) TMI 4 - SUPREME COURT] and M/s. Mokama Munger Highway Ltd. vs. ACIT [2019 (7) TMI 1816 - ITAT HYDERABAD] Thus we are of the considered view that the claim of provision as made by the assessee is in accordance with settled principal of law. Therefore, the authorities below were not justified in making the disallowance. - Decided in favour of assessee.
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