TMI Blog2017 (3) TMI 739X X X X Extracts X X X X X X X X Extracts X X X X ..... it has to go by the plain language of the unamended provision, and then, come to a conclusion in the matter. As alluded to above, our view, is that, upon a plain reading of the unamended provision, it could not be said that the Assessee could not claim balance depreciation in the A.Y., which follows the A.Y., in which, the machinery had been bought and used, albeit, for less than 180 days. Thus, having regard to the foregoing discussion, we are of the view that no interference is called for with the impugned judgment of the Tribunal. - Decided in favour of assessee. - Tax Case (Appeal) No.157 of 2017 - - - Dated:- 6-3-2017 - Rajiv Shakdher And R. Suresh Kumar, JJ. For Appellant : Mr. M. Swaminathan Judgment (Judgment of the Court was delivered by RAJIV SHAKDHER,J.) 1. This appeal is directed against the order of the Income Tax Appellate Tribunal (in short 'the Tribunal'), dated 24.08.2016, qua the Assessment Year (A.Y) 2011-12. 2. The Tribunal, by virtue of the impugned judgment, adjudicated upon two (2) appeals, vis-a-vis, two (2) separate orders of the Commissioner of Income Tax (in short 'CIT'), Madurai. 2.1. The first order dated 30 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aforesaid exercise, the CIT came to the conclusion vide his order dated 30.03.2015, that the order dated 27.02.2014, passed under Section 143(3) of the Act, was, not only erroneous, but also prejudicial to the interest of the Revenue, inasmuch the issue raised in the SCN was not considered by the Assessing Officer. Consequently, the CIT proceeded to cancel the assessment order dated 27.02.2014, passed under Section 143(3) of the Act and directed the Assessing Officer to redo the assessment, in terms of directions issued by him, after giving due opportunity to the Assessee. 5.7. To be noted, the additional depreciation claimed by the Assessee, which was, a sum of ₹ 8,03,233/-, and had been calculated at the rate of 10% - was, consequently, included in the total income of the Assessee. 6. Aggrieved by the same, the Assessee preferred an appeal before the Tribunal. 6.1. Therefore, the only issue, which arose for consideration before the Tribunal was, whether the additional depreciation, in the sum of ₹ 8,03,233/-, could be claimed by the Assessee in the relevant assessment year, i.e., A.Y.2011-12, in respect of machinery, which was purchased and used for less tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revious year, the deduction under this sub-section in respect of such asset shall be restricted to fifty per cent of the amount calculated at the percentage prescribed for an asset under clause (i) or clause (ii) 1`or clause (iia), as the case may be: Provided also .... Provided also... Provided also.... Provided also... Explanation 1.... Explanation 2.... Explanation 3... Explanation 4... Explanation 5... (iia) in the case of any new machinery or plant (other than ships and aircraft), which has been acquired and installed after the 31st day of Marcy, 2005, by an assessee engaged in the business of manufacture or production of any article or thing or generation or generation and distribution of power, a further sum equal to twenty per cent of the actual cost of such machinery or plant shall be allowed as deduction under clause (ii). Provided ...... (Emphasis is ours) 8. Pertinently, the Karnataka High Court, in a decision rendered in the case of CIT V. Rittal India (P.) Ltd., [2016] 66 taxmann.com 4 (Karnataka), has interpreted the aforesaid provision, in particular, the proviso incorporated therein. The Karnatake Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. 9. The language used in Clause (iia) of the said Section clearly provides that a further sum equal to 20% of the actual cost of such machinery or plant shall be allowed as deduction under Clause (ii) . The word shall used in the said Clause is very significant. The benefit which is to be granted is 20% additional depreciation. By virtue of the proviso referred to above, only 10% can be claimed in one year, if plant and machinery is put to use for less than 180 days in the said financial year. This would necessarily mean that the balance 10% additional deduction can be availed in the subsequent assessment year, otherwise the very purpose of insertion of Clause (iia) would be defeated because it provides for 20% deduction which shall be allowed..... 9. We are in respectful agreement with the view taken by the Division Bench of the Karnataka High Court, passed in CIT V. Rittal India (P.) Ltd. 10. According to us, these are provisions included by the Legislature in the Statute to give a fillip to new industries as also to existing industries, which seek to expand its sway, by investing in and making use of new plant and machinery. 10.1. The plain language of Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the legislature recognised the fact that the manner in which the Revenue chose to interpret the provision, as it stood prior to its amendment would lead to discrimination, in respect of plant and machinery, which was used for less than 180 days, as against that, which was used for 180 days or more. 11.3. In our opinion, as indicated above, the amendment is clarificatory in nature and not prospective, as is sought to be contended by the Revenue. The Memorandum cannot be read in the manner, in which, the Revenue has sought to read it, which is, that the amendment brought in would apply only prospectively. 11.4. We are, clearly, of the view that the Memorandum, which is sought to be relied upon by the Revenue, only clarifies as to how the unamended provision had to be read all along. 11.5. In any event, in so far as the Court is concerned, it has to go by the plain language of the unamended provision, and then, come to a conclusion in the matter. As alluded to above, our view, is that, upon a plain reading of the unamended provision, it could not be said that the Assessee could not claim balance depreciation in the A.Y., which follows the A.Y., in which, the machinery had be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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