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TMI Blog2010 (9) TMI 1152X X X X Extracts X X X X X X X X Extracts X X X X ..... f CIT(A) in deleting the addition made by Assessing Officer on account of disallowance of claim of additional depreciation. For this, Revenue has raised the following ground No.1:- "1) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition made by the AO on account of claim of additional depreciation of Rs. 9,45,450/-." 3. The brief facts are that the assessee engaged in the activity of embroidery works on fabrics on job work basis. According to the Assessing Officer the business of embroidery work on job work basis is not a manufacturing activity, hence, the additional depreciation claimed by assessee cannot be allo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing following finding in para-3.3 of his appellate order:- "3.3 I have considered the submission made by the appellant and the observation of the A.O. The case of the appellant is covered by the decision of the Hon'ble Supreme Court in the case of S.S.M. Bros. Pvt. Ld. & Others (243-ITR-418) wherein the Hon'ble Supreme Court stated as under:- '6. When both the provisions are read together this is the result: where the machinery or plant is installed for the purpose of the business of production of textiles, including those dyed, printed or otherwise processed, made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g embroidery work on job work basis and said activity also results in production of new article which has different market of its own and there are various stages which are involved in embroidery activity and the same can be briefly categorized as under:- i) Creating a digitalized embroidery design file; ii) Editing the design and/or combining it with other design (optional); iii) Load the final design file into the embroidery machine; iv) Stabilize the fabric and place it in the machine; & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The ratio of above decision of Hon'ble Supreme Court is directly applicable to facts of the instant case because Sec.32(1)(iia) also provides for additional depreciation in respect of new machinery and plant purchased by assessee who is engaged in the business of manufacture of production of any article or thing. In the above case the Hon'ble Supreme Court has already held that assessee was using machinery in production of processed textile i.e. embroidery work and thus, the fact embroidery work is regarded as production cannot be denied. Section 32(1)(iia) also used the word 'production of any article or thing' and thus, the product with embroidery work is included in the work any article or thing. In fact the provisions of section 32(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal is dismissed. 6. The next issue in this appeal of Revenue is against the order of CIT(A) in deleting the addition made by Assessing Officer on account of disallowance of interest expenditure. For this, Revenue has raised the following ground No.2:- "2) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition made by the AO on account of interest expenditure of Rs. 24,514/-." 7. Having heard the rival contentions and going through the facts and circumstances of the case. I find that the Assessing Officer has stated that the assessee had debit balance of Rs. 29,003/- in the case of a sister concern, namely, Haripriya E ..... X X X X Extracts X X X X X X X X Extracts X X X X
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