TMI Blog2017 (12) TMI 881X X X X Extracts X X X X X X X X Extracts X X X X ..... allow the appeal of the assessee and we direct the AO to allow set off, of depreciation pertaining to A.Y 1995-96 to 2000-01, against income of assessment year 2009-10. - Decided in favour of assessee. - ITA No.202/Kol/2016 - - - Dated:- 15-12-2017 - SHRI A.T. VARKEY, JM AND DR. A.L.SAINI, AM For The Assessee : Shri Subash Agarwal, Advocate For The Respondent : Shri Saurabh Kumar, Addl. CIT(DR) ORDER Per Dr. Arjun Lal Saini, AM: The captioned appeal filed by the assessee, pertaining to Assessment Year 2009-10, is directed against the order passed by the Commissioner of Income Tax (Appeals)-2, Kolkata, in Appeal No.1386/CIT(A)-2/Cir-4/201415, dated 22.12.2015, which in turn arises out of an order passed by the Assessing Officer under section 143(3) of the Income Tax Act, 1961, (hereinafter referred to as the Act ), dated 28.12.2011. 2.The assessee has raised the following grounds of appeal: 1.That the impugned order dated 22nd December 2015 passed by the learned Commissioner of Income Tax,(appeals) - 2 is liable to be quashed since it has been passed in haste without application of mind and without considering the evidences furnished submis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f assessee for set off of brought forward unabsorbed depreciation relating to A.Y 1995-96 to 2000-01 against the income of A.Y 2009-10. 4.The brief facts qua the issue are that on scrutiny of the assessment order passed u/s 143(3) on 28.12.2011, the assessing officer found that Brought Forward Unabsorbed Depreciation for Assessment Years 1995-96, 1997-98, 1998-99, 1999-2000, 2000-01 combining to a total of ₹ 50,03,977/- was allowed set off with the assessed income in contravention to the provision of section 32 of the I.T Act. Therefore, a notice u/s 154/155 of the Act was served on to the assessee on 18.10.2012 notifying the mistake. The mistake, as per AO, was being apparent from record and pro-judicial to the interest of the revenue, therefore the order passed u/s143(3) was rectified by Assessing Officer u/s 154 of the Act as under:- Total Income as assessed in order u/s 143(3) - Nil- Add: Brought Forward Unabsorbed Depreciation A.Y 1995-96 12,24,394/- A.Y 1997-98 23,43,144/- A.Y 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing officer under section 154 of the Act. 6. Not being satisfied with the order of ld. CIT(A), the assessee is in appeal before us. The ld. Counsel for the assessee has stated before us that CBDT has issued Circular No.14 of 2001, wherein it has been clarified that after amendment of section 32(2) in the Finance Act, 2001, w.e.f. 1st April, 2002, any unabsorbed depreciation available to the assessee as on 1st April, 2002 would be carried forward indefinitely till the time it is set off against the profits gains of subsequent years. The ld. Counsel placed relianceHigh Court at Ahmedabad in the case of General Motors India Pvt. Ltd. Vs. DCIT in the 354 ITR 244 wherein it was held that the unabsorbed depreciation can be carried forward and set off in the subsequent years without any time limit. Therefore it can be said that, current depreciation is deductible in the first place from the income of the business to which it relates. If such depreciation amount is larger than the amount of the profits of that business, 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... absorbed depreciation available to an assessee on 1st 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 section32(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.1995-96to 2000-01, 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. However, it does not contain any such provision. Hence keeping in view the purpose of amendment of section 32(2) of the Act, a purposive and harmonious interpretation has to be taken. While construing taxing statutes, rule of strict interpretation has to be applied, giving fair and reasonable construction to the language of the section without leaning to the side of assessee or the revenue. But if the legislature fails to express clearly and the assessee becomes entitled for a benefit within the ambit of the section by the clear words used in the section, the benefit accruing to the assessee cannot be denied. However, Circular No. 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
