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2015 (8) TMI 374 - ITAT MUMBAI

2015 (8) TMI 374 - ITAT MUMBAI - TMI - Proceedings u/s 154 - AO disallowed the brought forward of unabsorbed depreciation allowance - CIT(A) directed the AO to allow the assessee's claim of adjusting unabsorbed depreciation for the AY 1999-2000 from the house property income - Held that:- Any unabsorbed depreciation available to an assessee on 1st day of April 2002 (A.Y. 2002-03) will be dealt with in accordance with the provisions of section 32(2) as amended by Finance Act, 2001. And once the C .....

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soever.

Thus, the finding of the Ld. CIT(A) is based on the decision of Hon'ble Gujarat High Court in the case of General Motors India P. Ltd (2012 (8) TMI 714 - GUJARAT HIGH COURT), and no contrary decision of any other High Court has been brought to our notice, hence such a finding of the CIT(A) is upheld. Further, as held by the High Court the unabsorbed depreciation becomes the current year depreciation, which can very well be set off against any source under any of the other head .....

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sessee has claimed brought forward business losses of AY 2004-05. The ground raised by the revenue that it has been claimed against "Income from House Property" is misconceived. - Decided against revenue. - ITA No. 1356/Mum/2013 - Dated:- 10-7-2015 - G. S. Pannu, AM And N. Amit Shukla, JM,JJ. For the Appellant : Shri Yogesh Kamat For the Respondent : Shri Sanjiv M Shah ORDER Per Amit Shukla, JM. This appeal has been filed by the Revenue against order dated 16.11.2012 passed by CIT(A)- 21, Mumbai .....

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Ltd." 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A)'s erred in deciding that the assessee is entitled to c/f Short Term Capital Loss of ₹ 14,48,840/- pertaining to AY 2005-06 whereas actually as per records there is a Short Term Capital Gain of ₹ 12,32,400/- for that year i.e. AY 2005-06" 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A)'s erred in allowing the b/f business loss pertaining to AY 2004-0 .....

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as disallowed the brought forward of unabsorbed depreciation allowance after observing and holding as under: "As per Section 72 of the Income Tax Act, 1961, unabsorbed loss can be carried forward and set off against any other heads of income except income under the head business or profession for more than eight assessment years immediately succeeding the assessment year for which the loss was first computed. Further, as per Section 32 of the Income Tax Act, 1961, unabsorbed depreciation ca .....

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reciation allowance for and upto AY 1996-97, which could not be set off upto AY 1996-97, shall be carried forward and set off against income under the head for a maximum period of eight (8) assessment years starting from AY 1997-98 i.e. upto 2004-05". 4. The Ld. CIT(A) relying upon the decision of Hon'ble Gujarat High Court in the case of General Motors, directed the AO to allow the assessee's claim of adjusting unabsorbed depreciation for the AY 1999-2000 from the house property in .....

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epreciation and to be adjusted on the income of any head of the income instead of business income as in the pre-amended Act. In the ITAT Special Bench decision in the case of Times Guaranty Ltd., it is held that unabsorbed depreciation of AY 1997-98 upto 2001-02 can only be adjusted from the business income of the appellant. But this decision was overturned by the Gujarat High Court in the case of General Motors India P Ltd vs DCIT 25 Taxman.com 364 (Guj) wherein it was held as under: "We a .....

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t thereof, it came to be governed by the provisions of sec. 32(2) as amended by Finance Act, 2001 and were available to carry forward and set off against the profits and gains of subsequent years, without any limit whatsoever. In view of the above Gujarat High Court decision, I could not find any contradictory decision on this issue, therefore, I direct the AO to allow the appellant's claim of adjusting unabsorbed depreciation of AY 1999-2000 form the house property income of this year. Thes .....

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the A.Y. 1997-98, 1999-2000, 2000-01 and 2001-02 to be carried forward to the succeeding years, and if any unabsorbed depreciation or part thereof could not be set off till the A.Y. 2002-03 then it would be carried forward till the time it is set off against the profits and gains of subsequent years. 38. Therefore, it can be said that, current depreciation is deductible in the first place from the income of the business to which it relates. If such depreciation amount is larger than the amount o .....

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such succeeding year the unabsorbed depreciation is added to the current depreciation for such succeeding year and is deemed as part thereof. If, however, there is no current depreciation for such succeeding year, the unabsorbed depreciation becomes the depreciation allowance for such succeeding year. We are of the considered opinion that any unabsorbed depreciation available to an assessee on 1st day of April 2002 (A.Y. 2002-03) will be dealt with in accordance with the provisions of section 32 .....

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d gains of subsequent years, without any limit whatsoever. 6. Thus, the finding of the Ld. CIT(A) is based on the decision of Hon'ble Gujarat High Court in the case of General Motors India P. Ltd (supra), and no contrary decision of any other High Court has been brought to our notice, hence such a finding of the CIT(A) is upheld. Further, as held by the High Court the unabsorbed depreciation becomes the current year depreciation, which can very well be set off against any source under any of .....

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