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A.C.I.T., Central Circle-2, New Delhi Versus Wings Pharmaceuticals (P) Ltd.

2016 (2) TMI 792 - ITAT DELHI

Addition on account of excess depreciation claimed - asset put to use - Held that:- From the list of the machinery purchased by the assessee for the Baddi Unit, it reveals that the purchase of machinery was started from February, 2005 and production at Baddi unit was admittedly commenced from May, 2005 and therefore, no depreciation was claimed on the machinery installed at Baddi Unit for A.Y. 2005-06. It is also an admitted fact and evident that major part of machines at D-6 unit were shifted t .....

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ays or that the said machinery was not used for the purpose of business. In presence of these facts, we are inclined to sustain the findings of the ld. CIT(A) with respect to deletion of impugned addition.

Addition on account of building improvement of 35 HPSIDC, Baddi and errection of machines - Held that:- It is notable that no material or evidence was seized in the search to demonstrate that the assessee had incurred expenses in excess to that shown in the books of account. Moreove .....

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expenses, vehicle depreciation & vehicle maintenance on adhoc basis - Held that:- No expenditure is pointed out of inadmissible nature. The disallowance on mere suspicion and estimate is not sustainable in view of the decisions of Hon’ble Supreme Court in the case of Dhakeshwari Cotton Mills [1954 (10) TMI 12 - SUPREME Court ] and Sayaji Iron & engineering Co. vs. CIT [2001 (7) TMI 70 - GUJARAT High Court ], wherein it has been held that no disallowance is called for on account of personnel use .....

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and sale thereof during the assessment year under consideration. We are, therefore, not inclined to interfere with the order of ld. CIT(A) deleting the impugned addition. - Decided in favour of assessee

Disallowance u/s. 14A read with Rule 8D - Held that:- AO has failed to establish any correlation of expenditure with the exempted income. During the year under consideration, there was exempt income for ₹ 1,45,161/- and on this income no expenses have apparently been incurred as .....

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SAHU, ACCOUNTANT MEMBER For The Appellant : Sh. Ravi Jain, CIT/DR For The Respondent : Sh. Ved Jain, FCA ORDER Per L.P. Sahu, Accountant Member: This appeal, at the instance of Revenue, arises out of the order dated 21.12.2011 of the ld. CIT(A)-III, Delhi for the assessment year 2005-06 on the following grounds : 1. On the facts and in the circumstances of the case, the CIT(A) has erred in law and on facts in deleting the disallowance ofRs.23,50,000/- made by the Assessing Officer on account of .....

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ation and vehicle maintenance respectively. 4. On the facts and in the circumstances of the case, the CIT(A) has erred in law and on facts in deleting the addition of ₹ 10,00,000/- made by the Assessing Officer on account of sale of scrap. 5. On the facts and in the circumstances of the case, the CIT(A) has erred in law and on facts in deleting the disallowances of ₹ 7,35,818/- made by the Assessing Officer u/s. 14A of the Income tax Act. 6. The order of the CIT(A) is erroneous and i .....

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and machineries were shifted by assessee from its D-6, Udyog Nagar Indl. Area Delhi Unit to 35 HPSIDC Industrial Area Baddi unit, Distt. Soin (HP) as noticed from the statements of some of the employees recorded during the search proceedings. Some of the documentary evidences in respect of unaccounted transactions of the assessee as well as its directors were found and seized. From various statements recorded during the course of search, it was noticed that the assessee company has obtained acco .....

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/s. Krishna Machines & Tools, which was operated by Mr. Dinesh Sharma of Ghaziabad. Shri Dinesh Sharma had already been searched by Investigation Wing on 24.10.2007 and earlier by Central Excise and Custom department. As per search by Central Excise Authorities and his statement u/s. 14 of the Central Excise Act recorded, he was operating three firms and accepted that he had been providing accommodation entries to various concerns in Delhi & NCR. He accepted that he has issued bills with .....

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of machinery from D-6 unit to Baddi Unit. The WDV of plant and machinery as on 31.03.2005 of D-6 Delhi Unit as per companies Act was ₹ 1,60,50,810/-. Majority of these machineries had been shifted to Baddi Unit during the later part of the period from its Delhi Unit. During the assessment proceedings, the assessee claimed depreciation for its Delhi Unit of ₹ 71,91,123/- which includes plant and machinery of D-6 and H-18 both. The assessee could not submit its claim of depreciation f .....

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machines of D-6 unit were shifted to Baddi unit during latter part of the period. This addition made by the AO stood deleted by the ld. CIT(A) in appeal before him. 3. The DR relied on the order of the AO and submitted that there is no justification to delete the addition made by AO on account of excess depreciation claimed. The ld. AR of the assessee, on the other hand, relied on the order of ld. CIT(A). 4. Having considered the rival submissions and the material available on record we do not f .....

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di Unit in the later part of the period. Therefore, without going into the question whether and which machines and for what value has been shifted from D-6 unit to Baddi unit during the year, the ld. CIT(A) has rightly observed that the assessee was entitled to claim full depreciation for the whole year, if the machinery has been used for more than 182 days. It is not the case of Revenue that the machines, on which depreciation was claimed by assessee were not put to use for more than 182 days o .....

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es at ₹ 65,00,000/- and accordingly made an addition of ₹ 54,47,050/- on this head. The ld. CIT(A) deleted this addition vide impugned order, aggrieved by which the Revenue is in appeal before us. 6. The ld. DR relied on the order of the AO and the ld. AR of the assessee supported the order of the ld. CIT(A). 7. Having considered the record we find no justification to interfere with the conclusion of the ld. CIT(A) on this count. It is notable that no material or evidence was seized .....

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assessee s own case for A.Y. 2006-07 to 2008-09 in ITA Nos. 3247, 4072 & 4073/Del./2012 in favour of the assessee. Keeping all these facts in view, and respectfully following the decision of ITAT, we are of the considered opinion that the ld. CIT(A) has rightly deleted the addition made by AO for no good reason. Accordingly, ground No. 2 of the Revenue is dismissed. 8. Adverting to ground No. 3 of appeal of Revenue, it is born out on record that the Assessing has disallowed 1/8th of the tel .....

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of personnel use of vehicle/telephone by the directors/officials in the hands of a company. We, therefore, do not find any justification to interfere with the order of the ld. CIT(A) on this count. Accordingly, ground raised by Revenue is dismissed. 9. The brief facts relevant to ground No. 4 are that the AO on the basis of some notings pertaining to A.Y. 2007-08 and 2008-09, found made on the seized documents during the curse of search proceedings at Baddi Unit, made addition of ₹ 10,00,0 .....

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