TMI Blog1999 (8) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income-tax Act despite the fact that the Assessing Officer through protracted investigation established beyond doubt that the claim of depreciation on cylinders was shown deliberately wrong? 2. Whether, on the facts and in the circumstances of the case, the learned members of the Income-tax Appellate Tribunal erred in setting aside the order under section 271(1)(c) despite the fact that it was established beyond doubt that the computers were never purchased never used and never leased out ?" The assessment year involved is 1989-90. The assessee is engaged in the business of hiring cylinders. Up to the assessment year 1987-88, the assessee had the calendar year as its accounting period. However, for the assessment year 1988-89, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revious year it had purchased 15 computers for Rs. 50,26,200, which were leased out after accepting security deposit of Rs. 25,13,100. On these computers, the assessee claimed depreciation amounting to Rs. 37,69,273. However, after detailed investigation, the Assessing Officer came to the conclusion that the entire transaction of leasing was sham and in fact the assessee never became the owner of these computers. He consequently disallowed the claim of depreciation. This disallowance was also upheld by the Commissioner of Income-tax (Appeals) and the Appellate Tribunal. After initiating penalty proceedings under section 271(1)(c) of the Act against the assessee on the ground that it had furnished inaccurate particulars about the sale valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee. It is submitted by Mr. Jolly that apart from the fact that the Tribunal has failed to draw the correct inferences from the material available on record, while holding that the Explanation to section 271(1)(c) of the Act is not applicable on the facts of this case, it has even applied incorrect provisions of law. It is pointed out that the Explanation taken into consideration by the Tribunal stood omitted with effect from April 1, 1976. On the other hand, Mr. K. K. Wadhera, learned counsel for the assessee, has tried to support the view taken by the Tribunal. Having heard learned counsel for the parties we are of the view that a question of law does arise from the order of the Tribunal. It is evident from para. 11 of the Tribunal's o ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
