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2022 (8) TMI 902 - AT - Income TaxRevision u/s 263 by CIT - Claim made by the assessee u/s. 32AC in respect of investment made in the new plant & machinery - What is prejudicial to the interest of the Revenue ? - HELD THAT:- We notice that the assessee has made submissions before the AO stating that deduction u/s.32AC is allowable even for assets acquired prior to 01.04.2013 but installed during the financial year 2013-14 would be eligible for deduction by relying on various decisions rendered in the context of 32(1)(iia). Though there is no specific mention in AO’s order regarding the submissions made and basis of allowing the deduction, the facts of the case is that the assessee did make the submissions and the AO has taken the view that the assessee is eligible for deduction u/s.32AC. Section 32AC is a new provision inserted by the Finance Act 2013 and there is no direct judicial precedence to interpret the words used in the section “acquires and installs”. There are plethora of decisions that for the purpose of 32(1)(iia), the additional depreciation is allowable even for assets acquired prior to 31/03/2005 provided the installation of such assets is after 31/03/2005. Since the wordings used in section 32(1)(iia) and 32AC are similar whether the ratio of decisions rendered in the context of 32(1)(iia) is applicable for 32AC is a debatable issue where contrary views can be taken. In assessee’s case while interpreting the wordings “acquires and installs” in section 32AC, the AO has taken one view in allowing the deduction based on the submissions of the assessee of various judicial pronouncements rendered in the context of 32(1)(iia); whereas the CIT is not in agreement with the view based on the plain reading of section 32AC. The decision of the AO to allow deduction u/s.32AC cannot be stated as unsustainable in law as he has taken a possible view based on application of mind. The CIT has not brought any material on record to show that the view taken is contrary to law. In the light of these discussions and placing reliance on the decision of Hon’ble Supreme Court cited supra, we are of the considered view that the CIT is not justified in setting aside the order of the AO. Accordingly the directions of the PCIT are quashed. Appeal by the assessee is allowed.
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