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I.T.O., Ward-11 (3) Kolkata Versus M/s. Kesoram Textile Mills Ltd.

2017 (11) TMI 906 - ITAT KOLKATA

Disallowance of depreciation on plant and machinery and on Factory Building - business assumed to be shut down - Held that:- After hearing the rival contentions we find that the First Appellate Authority has recorded that the assets in question is part of the “block of assets”. He held that once the asset merges with the existing block of assets, which carry the same rate of depreciation and one asset of the block is put to use then the entire block would be eligible to depreciation. - The m .....

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the order of the Commissioner of Income Tax-(A)-10, Kolkata relating to A.Y. 2005-06 on the following grounds :- 1. That on the facts and in the circumstances of the case, Ld. CIT(A) has erred in deleting the disallowance of depreciation of ₹ 38,46,405/- on plant and machinery and on Factory Building. 2. The appellant craves leave to add/delete/modify the grounds of appeal. 2. After hearing the rival contentions we find that the First Appellate Authority has recorded that the assets in que .....

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not arise. For this proposition we rely on the decision of the Hyderabad Bench of the ITAT in the case of Natco Exports vs Dy. Commissioner of Income Tax, order dt. 11th June 2002,200386 ITD 445 Hyd, wherein it was held as follows:- "[b] The CIT(A) ought to have seen that when once the value of asset forms part of block of assets, depredation is to be allowed . 'on the entire block irrespective of user of any item falling within the block during the assessment year and hence depreciati .....

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he judgments of Jabalpur Bench of the ITAT in the case of Packwell Printers, the judgment of the Ahmedabad Bench of the ITAT in the case of Inductotherm (India) Ltd. (supra) and the judgment of the Patna Bench of the ITAT in the case of Parikh Engg. & Body Bldg. Co. Ltd. (supra). Therefore; in view of the decisions and interpretation of the concept of "block of assets" depreciation on ponds which is forming part of the block of assets has to. be allowed as deduction even though the .....

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hold the claim of the assessee for depreciation for both the assessment years and $et aside the order of the Id. CIT(A). 5. Respectfully following the propositions of law laid down in the above judicial precedent, we allow this claim of the assessee. 4. In our view the proposition of law laid down in this order apply to the facts of this case. The judgment of the Hon ble Supreme Court in the case of Liquidators of Pursa Ltd vs CIT (1954) 25 ITR 265 and the decision of the Hon ble Bombay High Cou .....

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Company Ltd. Vs CIT has held as follows :- The learned Tribunal found the decision of this court in the case of CIT Vs. Oriental Coal Co. Ltd. reported in (1994) 206 ITR 682 was squarely applicable to this case in rejecting the contention of the appellant that there was passive use of the plant and machinery of the mills for depreciation to be allowed in the lockout period. In our view the decisions relied upon by Mr .Sen support his contention. In Hindusthan Gas & Industries Ltd. this court .....

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ompany has to face in course of running of the business. The fact that the lock- out was not in theassessee's own business does not make any difference to the position. The assessee had leased out a generating set in course of its business. It could not get back the set even after the lease period because of the lockout in the lessee's factory. This is a happening which was incidental to the assessee's business of leasing out generating sets. The assessee itself was not actually runn .....

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