TMI Blog2015 (2) TMI 673X X X X Extracts X X X X X X X X Extracts X X X X ..... sures introduced in the Income-tax Rules to further the policy decision of the Union Government, cannot be seen as akin to the introduction of a new rate of tax, for the purposes of mounting a challenge against the same as arbitrary. Thus, do not find any merit in the challenge against exhibit P10 notification on the ground that the same offends the fundamental rights of the petitioner under article 14 of the Constitution of India. Resultantly, the writ petition fails, and is accordingly dismissed. - Decided against assessee. - W.P.(C).NO.23789 OF 2010 (W) - - - Dated:- 31-10-2014 - MR. A.K.JAYASANKARAN NAMBIAR, J. FOR THE APPELLANT : ADV. DR.K.P.PRADEEP FOR THE RESPONDENT : ADV.SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES), ADV.SRI.JOSE JOSEPH, SC, FOR INCOME TAX JUDGEMENT A. K. Jayasankaran Nambiar J.- The petitioner, who is an advocate by profession and an assessee under the Income-tax Act, 1961, challenges exhibit P10 notification dated April 21, 2009, by which the Income-tax Rules, 1962, were amended to provide for accelerated depreciation at the rate of 50 per cent. for new commercial vehicles that were acquired on or after the 1st day of January, 2009, but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009, but before March 31, 2009, which date was subsequently extended to September 30, 2009, vide exhibit P10 notification. It is clarified that the benefit of higher depreciation of 50 per cent. was extended to the acquisition of new commercial vehicles during the period specified in view of the fact that the Government of India had opined that the automobile industry still needed support during the period when the recessionary trend was noticed. The Explanatory Memoranda in respect of exhibits P9 and P10 notifications, which were laid on the table of the Lok Sabha and Rajya Sabha, are also produced as exhibit R2(B) and exhibit R2(C) along with the statement of the respondents. It is the specific contention of the respondents, therefore, that in view of the fact that the benefit of accelerated depreciation, in respect of commercial vehicles purchased and put to use during the prescribed period, was in furtherance of the policy decision of the Government taking into account the recessionary trend in the economy, there was a valid basis for the extension of the benefit of accelerated depreciation only in respect of vehicles purchased and put to use during the period fixed by the Un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... classification among the two categories of assessees for the purposes of grant of accelerated depreciation. He would also place reliance on the decision of the Supreme Court in Mysore Minerals Ltd. v. CIT [1999] 239 ITR 775 (SC) ; AIR 1999 SC 3185 to contend that the allowance for depreciation is granted to replace the value of an asset to the extent it has depreciated during the period of accounting relevant to the assessment year and as the value has, to that extent, been lost, the corresponding allowance for depreciation takes place. It is emphasised that the concept of depreciation takes into account the depreciation of the value of an asset during the period of accounting, which, under the Income-tax Act, is a whole year. It is his submission, therefore, that in the instant case, the benefit of accelerated depreciation ought to have been extended to all assessees for the whole year instead of confining it to only a specified period during the financial year. Lastly, counsel for the petitioner would also refer to the decision of the Supreme Court in Varkisons Engineers v. State of Kerala [2009] 25 VST 1 (SC) ; [2009] 16 SCC 120 for the proposition that the imposition of a diff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ular situation faced with regard to the country's economy and it was in order to provide a boost to the automobile industry during the period of recession that the said measures were adopted by the Union Government. The commercial vehicles that were purchased and put to use during the period, determined by the Union Government as necessary for the purposes of providing stimulus to the economy, thus stood clearly distinct and different from the commercial vehicles that were purchased and put to use during the period in the financial year when there was no recessionary trend in the particular industry. It is settled law that when it comes to laws relating to economic activities, they have to be viewed with greater latitude than laws touching the civil rights such as freedom of speech, religion, etc., and that the court must adjudge the constitutionality of such legislative measures by the generality of its provisions and not by its crudities or inequities or by the possibilities of abuse of any of its provisions. When it comes to economic decisions, it is for the State to decide what economic and social policy it should pursue and what discriminations advance those social and eco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omplied with the requirement of purchasing and putting to use vehicles during the prescribed period, would not militate against the concept of depreciation that was envisaged under the Income-tax Act for all such assessees. I am also not persuaded by the contentions of the petitioner with regard to the introduction of the benefit of enhanced depreciation in the middle of a financial year. It has to be noticed that the benefit of enhanced depreciation was introduced initially through exhibit P9 notification with effect from April 1, 2009. The said benefit was continued till September 30, 2009, through exhibit P10 notification. In so far as the benefit of enhanced/accelerated depreciation was conferred taking into account the policy decision of the Union Government to stimulate the country's economy, it cannot be viewed as a situation similar to the introduction of a new rate of tax during the middle of an assessment year. exhibits P9 and P10 notifications were issued in response to a situation that called for incentives so as to boost the economy that was facing recessionary trends. The measures introduced in the Income-tax Rules to further the policy decision of the Union Gover ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
