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2016 (3) TMI 185 - ITAT AHMEDABAD

2016 (3) TMI 185 - ITAT AHMEDABAD - TMI - Adoption of Fair Market Value (FMV) as on 01/04/1981 - Held that:- The assessee has placed Valuation Report by an authorized valuer who has adopted the value at ₹ 28.50 sq.ft. Further, the value adopted by the AO is at ₹ 20/- per sq.ft. After considering the rival contentions and looking to the peculiarity of the facts of the present case, we are of the considered view that the value at ₹ 25/- per sq.ft. would subserve the interest of j .....

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hereby direct the AO to allow the set off of unabsorbed depreciation against income assessed for the year under consideration. - Decided in favour of assesse - I.T.A. No. 401/Ahd/2012 - Dated:- 29-2-2016 - Shri Pramod Kumar, Accountant Member And Shri Kul Bharat, Judicial Member For the Appellant : Shri S. N. Soparkar, AR For the Respondent : Shri A.K. Pandey, Sr.DR ORDER Per Shri Kul Bharat, Judicial Member : This appeal by the Assessee is directed against the order of the Ld.Commissioner of In .....

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et Value) of ₹ 20/- per sq ft in place of ₹ 30/- adopted by the appellant as on 01/04/1981. Ld. CIT (A) further erred in not appreciating the fact that AO ought to have referred the valuation to DVO instead of estimating FMV himself. Ld. CIT (A) ought to have accepted FMV adopted by the appellant based on valuation report and comparable sale instance instead of confirming ALV taken by AO unprofessionally. 2. Ld. CIT (A) erred in law and on facts in not admitting sale instance and val .....

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in not granting set off of carry forward business loss of the earlier years against assessed income of the year under consideration. Both the lower authorities failed to appreciate the claim of the appellant that losses suffered in earlier years ought to be allowed for set off against income assessed for the year on account of sale of business asset. Ld. CIT (A) ought to have granted such set off of carry forward losses. 4. Ld. CIT (A) erred in law and on facts in partly confirming action of AO .....

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4D of the Act is not justified. 6. Initiation of penalty u/s 271 (l)(c) of the Act is not justified. 2. Briefly stated facts are that the case are that the case of the assessee was picked up for scrutiny assessment and the assessment u/s.143(3) of the Income Tax Act,1961 (hereinafter referred to as the Act ) was framed vide order dated 02/12/2011, thereby the Assessing Officer (AO in short) computed the Long Term Capital Gain (LTCG) of ₹ 7,43,86,860/- against the claim of assessee of ͅ .....

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of the brought forward business loss of ₹ 3,63,88,385/- against the income under the head in the assessment year under appeal. However, in respect of the unabsorbed depreciation, the ld.CIT(A) gave direction to AO for AYs 1990-91, 1991-92, 1993-94, 1995-96 & 1996-97 could have been set off upto AY 2004-05. In respect of unabsorbed depreciation pertaining to AYs 1997-98, 1993-94 & 1999-2000 being the period held that the depreciation could not be allowed. However, in respect of the .....

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ed that the action of the AO in adopting the FMV is not justified. The AO has not called for any report from the Valuation Officer. Moreover, the ld.CIT(A) also did not allow the assessee to place on record the Valuation Report. He submitted that under these facts, the assessee shall not given sufficient opportunity and the authorities below have adopted the different cost of acquisition unilaterally without being supported by any evidence. 3.1. On the contrary, the ld.Sr.DR Shri A.K. Pandey opp .....

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orized valuer who has adopted the value at ₹ 28.50 sq.ft. Further, the value adopted by the AO is at ₹ 20/- per sq.ft. After considering the rival contentions and looking to the peculiarity of the facts of the present case, we are of the considered view that the value at ₹ 25/- per sq.ft. would subserve the interest of justice. Accordingly, we hereby direct the AO to adopt the cost of acquisition @ ₹ 25/- per sq.ft. and, accordingly, recompute the capital gain. Thus, grou .....

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come assessed for the year under appeal. The ld.Sr.counsel for the assessee submitted that the authorities below erred in law and on facts in not considering the various submissions and evidences placed on record by the assessee in its proper perspective and further erred in not appreciating commercial view point of the assessee. The ld.Sr.counsel for the assessee submitted that the ld.CIT(A) ought to have allowed the claim of unabsorbed depreciation in full. Further, he submitted that the issue .....

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Hon ble (ITAT), i.e. for AYs 1990- 91, 1991-92, 1993-94, 1995-96 & 1996-97 as per chart above could have been set off upto AY 2004-05 only. The same cannot be set off in AY 2008-09. (2) Unabsorbed depreciation pertaining to AYs 1997-98, 1993-94 & 1999- 2000 (termed as Second unabsorbed depreciation allowance by Hon ble ITAT) cannot be set off in AY 2008-09, eight year period having expired. For AYs 2000-01 & 2001-02, there is no unabsorbed depreciation allowance in appellant s case. .....

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assessee is aggrieved by the above directions of the ld.CIT(A). The contention of the ld.Sr.counsel for the assessee is that the ld.CIT(A) ought to have allowed the unabsorbed depreciation in full as the issue is squarely covered by the decision of the Hon ble Jurisdictional High Court rendered in the case of General Motors India (P) Ltd. vs. DCIT reported at (2013) 354 ITR 244 (Guj.). The Hon ble High Court of Gujarat, in the said case, considering the amendment to the Statute and the Circular .....

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st 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 not by the provisions of section 32(2) as it stood before the said amendment. Had the intention of the Legislature been to allow the unabsorbed depreciation allowance worked out in A.Y. 1997-98 only for eight subsequent assessment years even after the amendment of section 32(2) by Finance Act, 2001 it would have incorporated a provision to that effect. Ho .....

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mbit of the section by the clear words used in the section, the benefit accruing to the assessee cannot be denied. However, Circular No.14 of 2001 had clarified that under Section 32(2), in computing the profits and gains of business or profession for any previous year, deduction of depreciation under Section 32 shall be mandatory. Therefore, the provisions of section 32(2) as amended by Finance Act, 2001 would allow the unabsorbed depreciation allowance available in the A.Y. 1997-98, 1999-2000, .....

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ss, then such excess comes for absorption from the profits and gains from any other business or business, if any, carried on by the assessee. If a balance is left even thereafter, that becomes deductible from out of income from any source under any of the other heads of income during that year. In case there is a still balance left over, it is to be treated as unabsorbed depreciation and it is taken to the next succeeding year. Where there is current depreciation for such succeeding year the una .....

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