TMI Blog2018 (5) TMI 626X X X X Extracts X X X X X X X X Extracts X X X X ..... ion. No justification to interfere with the order of the CIT(A) for allowing additional depreciation, as claimed by the assessee. - Decided in favour of assessee. - ITA No. 4139/Del./2014 - - - Dated:- 4-5-2018 - Shri H.S. Sidhu, Judicial Member And Shri L.P. Sahu, Accountant Member For The Appellant : Sh. Ravi Kant Gupta, Sr. DR For The Respondent : Sh. Ranjan Chopra, C.A. ORDER Per L.P. Sahu, A.M.: This is an appeal filed by the Revenue against the order of ld. CIT(A)-VI, New Delhi dated 30.04.2014 for the assessment year 2010-11 on the following solitary ground : 1. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in allowing additional depreciation of ₹ 72,90,238/- u/s. 32(1)(iia) of the I.T. Act, 1961 on items installed in the various outlets of the assessee not linked to manufacturing activities without adjudicating this issue raised specifically by the A.O. in the assessment order. 2. From the above ground, the only challenged thrown by the Revenue is with respect to deletion of disallowance of additional depreciation worth ₹ 72,90,238/-. The brief facts of the case are that the assessee i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,27, 250/- Preet Vihar 12. Compressor 209 9,7677- Pitampura 13. Extension for change over 191 18,7307- Faridabad 14. Distribution panel as roof top. -DO- 1,08,130/- Faridabad 15. Air Conditioner R-3064 2,36,250/- Not known 16. Chat Coffee Trolley 21 1,95,000/- 17. Blue Star A.C. 201 86,000/- Preet Vihar 18. Blue Star make duetable unit 204 4,46,433/- Preet Vihar 19. Installation of A.C. Ducts 118 1 ,76,700/- Not known 20. Wrapping Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under : 5.3.7. An assessee engaged in the business of manufacture or production of any article or thing is entitled to claim additional depreciation in respect of new machinery or plant (other than ships aircraft) acquired and installed after 31 March, 2005, subject to the fulfillment of specified conditions. Additional Depreciation is allowable at 20% of the actual cost of such plant or machinery in the year in which such plant or machinery is acquired and put to use. However, if the said plant machinery is put to use for less than 180 days in the year in which it is acquired, the additional depreciation is allowable at 50% of the prescribed rate, i.e. at 10% of the actual cost of such plant or machinery. Additional or Enhanced Depreciation is in addition to normal depreciation allowable u/s 32 of the Act it is allowable in respect of new Plant Machinery even for existing business. 5.3.8. However, Additional Depreciation will not be available for the following : (i) Any machinery or plant which was used by any other person, before its installation by the assesses. (ii) Any machinery or plant which is installed in any office premises or residential ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , whether by hand labour or machines. The process of curing of Coffee starts with the drying of coffee and thereafter there comes the stage of hulling which means removing Outer husk of coffee bean. Thereafter, there is a process of roasting which gives brown colour to coffee an d there is also change in chemical component and that the process of roasting brings with it splendid aromatic qualities and pleasing taste. 5.3.12 Though it is true that while interpreting a taxing statute, regard must be had to the scheme, context and legislative history of provision, but with all humility, it appears that there is no material to hold that legislature did not intend to provide the deduction of Additional Depreciation to the Manufacturers of food products/foodstuff e.g sweets and namkeens etc, Hotels and Quick Service Restaurants (QSR). Moreover the Hon!ble Supreme Court in the later decision in the case of Aspinwall and Co. (Supra) held that food prepared from raw materials is certainly a new commodity i.e food stuff that is prepared is different from raw materials in terms of name, character, taste, colour, aroma use. The business for preparation of food staff cannot be treated a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rival submissions of the parties and perusing the entire material available on record, we find much force in the contention of the assessee that the assessee is engaged in the manufacturing activities. The ld. CIT(A) has also correctly dealt with the objection of the Assessing Officer regarding the activities of the assessee being that of a manufacturer. The ld.CIT(A) has also considered various case laws in support of his conclusion that the assessee comes within the category of a manufacturer. The contentions made by the assessee based on National Industrial Classification, referred to above, are also found acceptable on the point of assessee being manufacturer. We, therefore, do not find any justification to interfere with the findings reached by the ld. CIT(A) that the assessee is a manufacturer and was eligible to claim, on this count, the additional depreciation on the plants and machineries acquired and installed. 8. However, while going through the assessment order and the order of the ld. CIT(A), we find it obvious on record that the Assessing Officer, apart from doubting the activities of assessee, being that of manufacturer, has also objected, from the details of ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of is earned from restaurant. Also, the equipments or plants are installed at those premises. Further, the ld. AO has not brought any material on record to show that those plants are installed at any office premises or any residential accommodation in the nature of guest house. It is also a matter of common knowledge that Air Conditioners are required at manufacturing outlets to keep the sweets also in proper condition over and above refrigerators. Electricity distribution penal also cannot be said to be installed at residential place. No material is brought on record by the AO that the outlets do not manufacture sweets. It is of paramount importance that the AO has granted normal depreciation on all those items holding them to be plant and machinery. In view of this, we are of the view that assessee has satisfied the conditions for additional depreciation. We, therefore, do not find any justification to interfere with the order of the ld. CIT(A) for allowing additional depreciation, as claimed by the assessee. Accordingly, the appeal of the Revenue deserves to be dismissed, being devoid of merits. 10. In the result, the appeal is dismissed. Order pronounced in the open court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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