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M/s Anand Transport Versus The Assistant Commissioner of Income Tax, Business Circle – I, Chennai

Disallowance of depreciation @ 100% on the cost of erection of temporary structure - Held that:- As period of three months was given from 24.06.2009 which can be extended by the consent of parties subject to the permission that may be given by Ennore Port. The object and purpose of erection of Jetty was for temporary in nature and not as a permanent establishment. Merely because an option was given to the assessee to continue till 31.03.2010 subject to export market conditions, that does not mea .....

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rities are set aside. The Assessing Officer is directed to grant depreciation @ 100% on the cost of erection of temporary structure, namely, the Jetty at Ennore Port Trust. - Decided in favour of assessee - ITA No.737/Mds/2014 - Dated:- 14-8-2015 - SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER For The Appellant : Dr. Anita Sumanth, Advocate For The Respondent : Sh. P. Radhakrishnan, JCIT ORDER PER N.R.S. GANESAN, JUDICIAL MEMBER: This appeal of the assessee .....

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59 ITR 19. However, the reasons were not furnished. The Ld.counsel further submitted that however, in the course of appellate proceedings, the reasons were brought to the notice of the assessee. According to the Ld.counsel, when the assessee was not furnished the reasons, the entire proceeding is vitiated. Therefore, the assessment order does not stand in the eye of law. 4. Coming to the merit of the appeal, the Ld.counsel submitted that the assessee entered into an agreement for creation and op .....

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s a temporary structure created by the assessee for the purpose of business. Referring to subsequent agreement, a copy of which is available at page 57 of the paperbook, the Ld.counsel submitted that on 12.08.2009, the agreement dated 06.05.2004 was modified and the operation of Jetty was restricted till the Ennore Port allows the operation or for a period of three months from 24.06.2009, whichever is earlier. An option was given to the parties to extend the operation till 31.03.2010. 5. Accordi .....

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in Geetha Hotels (P) Ltd. v. CIT (2002) 254 ITR 649. Referring to the judgment of Apex Court in CIT v. Anand Theatres (2000) 244 ITR 192, the Ld.counsel submitted that the temporary structure erected by the assessee would fall within the definition of building . Therefore, it is entitled for depreciation @ 100%. 6. On the contrary, Sh. P. Radhakrishnan, the Ld. Departmental Representative, submitted that the assessee erected the Jetty for transport of iron ore in Ennore Port Trust. Referring to .....

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eciation @ 25%. 7. We have considered the rival submissions on either side and perused the relevant material on record. We have also carefully gone through the Depreciation Schedule at old Appendix 1, which is applicable for 2003-04 to 2005-06. For the assessment year 2005-06, under Part-A heading tangible asset , and sub-heading I Building temporary erections such as wooden structure are falling under the classification building and 100% depreciation was prescribed. Old Appendix-1 Part A (1)(4) .....

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ed as only a purely temporary purpose. In the case before us, the agreement entered into between the assessee and MMTC Limited clearly says that it is for a period of three years from the end of the commencement of operation. In fact, para 6.1 reads as follows:- The BOT Operator shall operate the jetty and other ironore loading facilities for a period of three years from the date of commencement of vessel loading operation. On cessation of operations at the end of three years, the BOT Operator s .....

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