Contact us   Feedback   Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (9) TMI 850 - DELHI HIGH COURT

2015 (9) TMI 850 - DELHI HIGH COURT - TMI - Entitlement to depreciation claimed in respect of Unit-II - AO held that the Assessee failed to prove that it had undertaken any manufacturing activity during the AY in question - CIT(A) allowed claim - Held that:- On facts, it is not in dispute that the building was constructed in the previous year 1988-89. Further, the plant and machinery was installed in the factory in the previous year ending 31st March 1990. The Court in of the view that the insta .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ss. It is not the Revenue's case that the building and plant and machinery were not for the purpose of business of the Assessee. Therefore, it is concluded that the building and machinery in Unit II were used for the purpose of the business of the Assessee during the AY in question. - Decided in favour of assessee. - ITA 346/2002 - Dated:- 16-9-2015 - S. Muralidhar And Vibhu Bakhru, JJ. For the Appellant : Mr. S. Krishnan, Advocate For the Respondents : None ORDER 1. This appeal by the Assessee, .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

3. The facts to this appeal are that the Assessee is a registered firm carrying on business of manufacturing bag stitching machines in a factory situated at Noida since 1981. In the year 1987 the Assessee applied for and was allotted plot No. A-11, Sector-57, Noida. It constructed a factory building thereon in the accounting year ending 31st March 1989 (AY 1989-90) and the cost of the factory building was ₹ 9,77,775.58. Machinery worth ₹ 1,10,825 was installed in the said factory (s .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d that (i) no sales have been made from Unit-II; (ii) purchases made for Unit-II are only ₹ 361.70; (iii) no expenses under any head have been claimed; (iv) all the wages payments and official documents showed that no manufacturing activity took place; (v) no separate staff was engaged and (vi) no power bill has been received. The AO held that the Assessee failed to prove that it had undertaken any manufacturing activity during the AY in question. 5. The Commissioner of Income Tax (Appeals .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e and were profit making apparatus. 6. Aggrieved with the above order of the CIT (A), the Revenue went in appeal before the ITAT. The ITAT referred to the decision of the Supreme Court in Federation of Andhra Pradesh Chambers of Commerce and Industry v. State of Andhra Pradesh [2001] 247 ITR 36 (SC) and concluded that in order to claim depreciation, it is important, inter alia, that the asset must be actually used for the purpose of business. Accordingly, it was held that the CIT (A) was not jus .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

econd, the user of the assets for the purposes of the business. The Court on the facts of the said case rejected the stand of the Revenue that the machinery and equipment had to be put to actual use and that it would not be enough if they were "kept ready for use". The Court referred to a large number of decisions of the High Courts which held that the expression "used for the purpose of business" in Section 32 of the Act was interpreted to include a case where the asset is k .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version