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2018 (3) TMI 587 - HC - Income TaxAdditional depreciation on hospital equipments - disallowance of claim as Assessee has claimed written down value of assets as Additional depreciation after its useful life - assessee is a charitable trust, running a hospital - Held that:- Where a plant and machinery is discarded/ destroyed in the previous year, the amount of money received on sale as such or as scrap or any insurance amount received to the extent it falls short of the written down value is allowed as depreciation, provided the same is written off in the books of account. In this case, the Respondent-Assessee could not sell the hospital equipments as scrap nor the Assessee could use the hospital equipments. Therefore, the written down value of the hospital equipments, was to be allowed as depreciation. This is so, provided the hospital equipment (asset) is written off in its books of accounts. This has been admittedly done i.e. writing off from its books. Thus, the nomenclature, as additional depreciation rather then depreciation, is the only objection of the Revenue. Nomenclature, cannot decide a claim. In any case, this could also be allowed as an expenses under Section 37 of the Act as it is an expenditure incurred wholly and exclusively for carrying out its its activity as a hospital (on application of commercial principles). - Decided against revenue
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