9911796707
TMI Blog2011 (3) TMI 1447X X X X Extracts X X X X X X X X Extracts X X X X ..... though the question raised are five in number, we notice that only two issues arise for consideration. First one relate to disallowance of excess interest tax collected by the assessee and the other one relate to disallowance of depreciation on machinery leased out by the appellant to other parties. So far as the first question is concerned, what we notice is that the assessee collected excess interest tax to the tune of Rs. 30,10,004/- which was not remitted to the Government as the same was excess collection. The Assessing Officer noticed that excess collection of interest tax forms part of income of assessee and so much so the same has to be assessed as income. This view is upheld by the two appellate authorities including the Tribunal a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inal return the assessee claimed depreciation of a huge amount of Rs. 2,28,26,231/- towards depreciation eligible for lease made to three companies, namely (1) M/s. Metal Point, Chennai, (2) D.C. Kothari Textiles Ltd., Chennai and (3) Moser Baer (India) Ltd., Noida. However, it is seen from the order of the Tribunal that the assessee, after filing return, filed application to withdraw the depreciation claimed in respect of the machinery leased out to M/s. D.C. Kothari Textiles Ltd., Chennai. In other words, the assessee itself felt that the claim of depreciation of Rs.99,69.006/-could not be established and therefore the claim was withdrawn. So far as the depreciation claimed on the lease made to M/s. Metal Point, Chennai is concerned, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... achinery that is, Rs. 1,00,57,225/- on the ground that the item leased out is air pollution control equipment which is entitled for 100% depreciation under Old Appendix-I Entry (iv) of IT Rules, 1962-which is as; follows: "(iv) Air pollution control equipments being- (a) Electrostatic precipitation systems (b) Felt-filter systems (c) Dust collector systems (d) Scrubber-counter current/venturi/ packed-bed/cyclonic scrubbers (e) Ash handling system and evacuation system." 5. On going through the Tribunal's order, we find that the department conducted a detailed enquiry with the lessees' premises and found that that as on the last date of the previous year, that is 30.3.1996, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pollution. We do not know on what basis a lessor company claimed 100% depreciation in respect of certain equipment supplied, which, when assembled with other items on site constitute plant for controlling air pollution. In our view, when the lessor claims depreciation in respect of an item of machinery with reference to its use which is only made by the lessee, necessarily the lessee has to put to use the machinery for the purposes stated in the depreciation schedule to entitle it for the rate of depreciation provided therein. It is not a case of assessee claiming depreciation on an item of machinery but the depreciation claimed is in respect of pollution control equipment which identify at least the equipments has to assume at the end of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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