Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2021 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (9) TMI 278 - AT - Income TaxRevision u/s 263 by CIT - entitled to deduction under section 32AC - allowance of depreciation on assets acquired earlier, but were installed during the present assessment year - scope of amendment - as argued installation and capitalization was not evident - HELD THAT:- The first proviso to the section inserted Finance Act, 2001 w.e.f. 01/04/2016 mentions that provided that where the installation of the new assets are in a year other than the year of acquisition, the deduction under this sub-section shall be allowed in the year in which the new assets are installed.10. Notes to clauses in the introduction clarifies that it is meant to remove hardships. In our considered opinion, since amendment is meant to remove a hardship, the same needs to be given retrospective effect. This proposition is based upon the Haydens rules or mischief rules. According to this rule, while interpreting statutes, first the problem or mischief that the statute was designed to remedy should be identified and then a construction that suppresses the problem and advances the remedy should be adopted. This proposition is also duly supported by Hon’ble Supreme Court decision in the case of Alom Extrusions[2009 (11) TMI 27 - SUPREME COURT] and Calcutta Exports Company [2018 (5) TMI 356 - SUPREME COURT] that when an amendment is made to clarify or remove the hardship, the same is to be treated as clarificatory amendment and it applies retrospectively. There certainly can be view on this issue that the assessee is eligible for allowance for depreciation on assets which have been acquired earlier, but were installed during the present assessment year. Assessee has provided the details of computation of depreciation including that u.s 32AC to the AO. The grievance of the Ld.CIT, which is echoed by CIT-DR before us is that the AO has not obtained the details of assets acquired earlier, which has been installed during the year. As in the Ld.CIT’s view the assets acquired prior to the financial year are not eligible for depreciation u.s 32AC. There certainly can be a legally sustainable view that assessee is eligible for allowance of depreciation on assets, which have been acquired earlier, but were installed during the present assessment year. CIT is not correct in observing that the installation and capitalization is not evident. We find that the installation and capitalization was clearly evident from the financials of the assessee company - AO took the view that the assessee is eligible for the depreciation on all these assets, which have been duly capitalized during the financial ear. It can be said that AO has taken a possible view and if the Ld.CIT is not in agreement there with and takes a contrary view, the same would not give raise to the section 263 jurisdiction with the Ld.CIT. Assessee has filed an additional evidences regarding installation of the machinery. Though, we have already pointed out hereinabove, that once the assets is capitalized in the financials of the company, the same can be said to have taken place only after installation of the company of the assessee. In any case, since assessee’s counsel has given the additional evidences before us, we direct the same should be examined by the AO. AO should grant depreciation to the assessee after examination thereof. We set aside the direction of the Ld.CIT that assessee is eligible to claim deduction only where invoice date falls after 01/04/2013.appeal by the assessee stands allowed for statistical purpose.
|