TMI Blog2017 (5) TMI 431X X X X Extracts X X X X X X X X Extracts X X X X ..... sable and written off. See Commissioner of Income Tax v. Zoom Communication Pvt. Ltd. [2010 (5) TMI 34 - DELHI HIGH COURT] The Court is, therefore, unable to concur with the view taken by the ITAT, which, in turn, affirmed the view of the CIT(A) that the claim of the Assessee fell within the scope of Section 32 (1) (iii) of the Act. This is based on an erroneous reading of the provision as explained by this Court hereinbefore.Consequently, the question farmed is answered in the negative i.e. in favour of the Revenue and against the Assessee. - ITA 926/2015 - - - Dated:- 4-5-2017 - S. MURALIDHAR CHANDER SHEKHAR JJ. Appellant Through: Mr. Raghvendra Singh, Advocate Respondent Through: Mr. Pranjal Srivastava, Advocate O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ws two blocks i.e, Building (5%) block and Air handling System (25%) which were on a rented premises. Since the Assessee had closed the said line of business, it had to write off the assets in its Profit Loss Account ( P L Account ). Consequently, the CIT(A) deleted the addition made by the AO. 7. The Revenue then carried the matter in appeal to the ITAT. By the impugned order, the ITAT dismissed the appeal by holding as under: (i) The claim of the assessee clearly falls within the scope of S. 32 (1) (iii). The part of the amount realized by the assessee has been offered to tax. The balance of the amount pertaining to the block had no realizable value, has not been disputed by the assessing officer. The difference is allowable u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (ii) in the case of any block of assets, such percentage on the written down value thereof as may be prescribed. (iii) in the case of any building, machinery, plant or furniture in respect of which depreciation is claimed and allowed under clause (i) and which is sold, discarded, demolished or destroyed in the previous year (other than the previous year in which it is first brought into use), the amount by which the moneys payable in respect of such building, machinery, plant or furniture, together with the amount of scrap value, if any, fall short of the written down value thereof. 9. It is seen that there are two sub-clauses (i) under Section 32(1). The first sub-clause (i) generally talks of deprecation being ava ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as under: 8. As regards the amount claimed on account of unusable and discarded assets, the Tribunal, in our view, was entirely incorrect in taking the view that the deduction claimed by the assessee was admissible to it under section 32(1)(iii) of the Income-tax Act, though not as a revenue expenditure. Section 32(1)(iii) of the Act provides for deduction, in the case of any building, machinery, plant or furniture, in respect of which depreciation is claimed and allowed under clause (i) and which is sold, discarded, demolished or destroyed in the previous year (other than the previous year in which it is first brought into use), of the amount by which money payable in respect of such building, machinery, furniture, together with the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
