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Dy. Commissioner of Income Tax-6, Kanpur Versus M/s J.K. Cement, Kamla Tower

2016 (1) TMI 351 - ITAT LUCKNOW

MAT computation - whether the surcharge and educational cess is leviable only after giving credit for MAT and thereafter the tax computation made by the AO in ITNS-7 attached with the impugned order dated 27.11.2014, is not a correct way of tax calculation? - Held that:- CIT(A) has correctly understood the mode of computation of tax and issued correct direction to the AO that while computing the tax, first give credit of MAT and thereafter, charge the surcharge & education cess. Since we do not .....

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evised u/s 154 of the Act. We therefore, find no justification to interfere with the order of Ld. CIT(A) as he has rightly adjudicated the issue. - Decided against revenue - ITA No.513, 514/LKW/2015 - Dated:- 16-10-2015 - SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER For The Appellant : Dr. A.K. Singh CIT, DR For The Respondent : Shri Rakesh Garg, Advocate ORDER PER SUNIL KUMAR YADAV, JM. 1. These appeals are preferred by the Revenue against the respective orde .....

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give credit of MAT and thereafter charge the surcharge & education cess without appreciating the facts and merits of the case brought on record by the AO in the order. 3. The facts in brief born out from record are that the assessment was completed vide order dated 09.11.2009 and income was assessed at ₹ 2,69,50,00,991/-, which was subsequently revised u/s 251 and u/s 154 and assessed income was finally computed at ₹ 1,97,27,51,880/-. The tax payable was calculated by the AO aft .....

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1.2014 also. 4. Subsequently, the appellant was served with a notice u/s. 154 dated 24.07.2014 proposing to rectify the following mistake pointed out in the said notice:- "it has been noticed from the ITNS- 150 that MAT credit has been allowed before charging of surcharge & education cess whereas, the same should have been allowed after charging surcharge & education cess. Therefore, the same have been required to allow as per provisions of the Act." 5. In response to the notic .....

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IT(A) with the submission that the surcharge and educational cess is leviable only after giving credit for MAT and thereafter the tax computation made by the AO in ITNS-7 attached with the impugned order dated 27.11.2014, is not a correct way of tax calculation. In support of this contention, he placed reliance upon the following judgments:- 1. CITVs. Vacment India [ (2014) 369 ITR, 304 (Alld. HC) ] 2. Universal Medicare P, Ltd., Bombay Vs. ACIT - LTU, Mumbai (ITAT 'F Bench, Mumbai) (In ITA .....

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ollowed the judgment of the Hon ble Allahabad High Court in the case of CIT Vs. Vocment India (Supra) directed the AO that while computing the tax, first give credit of MAT and thereafter, charge the surcharge & education cess. 9. Aggrieved the Revenue is in appeal before the Tribunal and has placed reliance on the order of the AO. 10. Ld. counsel for the assessee on the other hand submitted that correct mode of computation of tax is to first give credit of MAT and thereafter, charge the sur .....

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Ld. CIT(A) on solitary ground that the CIT(A) has erred in law and on facts in allowing the relief of ₹ 31,53,46,771/- on account of additional depreciation u/s 31(1)(iia) of the Income Tax Act, 1961 without appreciating the fact that the power generating plant and machinery installed by the assessee company is not a part of business of manufacturing or producing or any article or thing which increase the installed capacity of production of cement as required for claiming such additional d .....

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ditional depreciation attributable to said power generating units and the said additional depreciation was allowed in the assessment proceeding vide order dated 24.12.2010. 14. Subsequently, the assessee was served with a notice dated 18-02-2015 u/s 154 of the Act, through which the assessee was required to show cause as to why additional depreciation allowed earlier vide assessment order dated 24-12- 2010, under clause (iia) of Section 32 of ₹ 31,53,44,771/- attributable to the power Gene .....

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urther, as per section 32(l)(iia), the word "[or in the business of Generation or generation and distribution of power has been inserted by the Finance Act, 2012 w.e.f. 01-04-2013, therefore, additional depreciation on Power generation units during the year under consideration is not allowable. 15. The assessee filed a reply that the additional depreciation on power units was rightly allowed and it did not call for any interference in u/s 154 of the Act. But, the A.O. was not convinced with .....

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rted in (1970) 25 57C 188 (SC). The CIT(A) reexamined the claim of the assessee and being convinced with the explanation, he held that assessee company is entitled for additional depreciation, therefore, it was rightly allowed in the original assessment. The CIT(A) has also held that the additional depreciation cannot be denied u/s 154 of the Act and he accordingly deleted the addition. The relevant observation of the CIT(A) is as under:- I have gone through the facts of the case and also peruse .....

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generation is also akin to manufacture or production of an article of thing. This view has also been followed by the Hon'ble ITAT, Delhi Bench in the case of N.T.P.C. Ltd. Vs. by. Commissioner of Income Tax. Further, Hon'ble Madras High Court and Gujarat High Court in the judgment as cited above have clearly held that if an assessee is engaged in manufacturing of any article or thing apart from generation of Power, he is entitled for additional depreciation under section 32(l)(iia) of t .....

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uot;article" or "thing". Thus, taking into consideration all these aspects and after following above judicial pronouncements, I am of the view that claim of assessee company of additional depreciation is well justified and it was rightly allowed vide assessment order dated 24.12.2010, hence the same cannot be denied u/s. 154, accordingly, the disallowance is hereby deleted. Further, ground no. 4 & 5 relates to the jurisdiction of Section 154 which is clear and obvious that the .....

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