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TMI Blog2019 (4) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... ng that under the facts and circumstances the decision of the Hon'ble Supreme Court results in total stoppage of business of permanent nature. 5. That the authorities below erred in assuming that the plant was not operational. 6. That the CIT-A erred in confirming the disallowance of depreciation by rejecting the ground on 'Block of Asset' concept. 7. That the authorities below erred in relying on irrelevant material and ignoring the relevant material. 8. For the above and other grounds and reasons which may be submitted during the course of hearing of the appeal, the assessee requests that the appeal be allowed as prayed and justice be rendered." 3. The relevant facts in brief are that it is noted by the AO in Para 3 of the assessment order that it is noticed that assessee has claimed an amount of Rs. 5,85,98,656/- towards depreciation for the present year. The AO has further noted that fixed assets of the assessee include Building and Plant and Machinery related to the mining activity of the assessee. The AO further noted in the same para that assessee has not carried out any mining activity during the Financial Year 2013-14 relevant to Assessment Year 2014-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me of Rs. 12 Lakhs on account of lease rent receipts, Rs. 2,39,909/- on account of loading charges receipts and Rs. 4,37,925/- on account of weighment charges receipts. He further submitted that similarly for Financial Year 2012-13 also, similar receipts are there as can be seen on page no. 166 of paper book which shows receipt of Rs. 12 Lakhs on account of Lease Rent Receipts, Rs. 2.40 Lakhs on account of Loading Charges Receipts and Rs. 22,22,159/- on account of Weighment Charges Receipts. Regarding current Assessment Year, he submitted that the copy of audited financial statements is available on pages 66 to 78 of paper book and in particular, our attention was drawn to page no. 73 of paper book where in schedule 9, the details of other income are available which includes Contract Income of Rs. 8,24,72,035/-. Reliance was placed by him on the following judicial pronouncements. A) CIT &Anr Vs. Blend Well Bottles (P) Ltd. (supra) B) CIT Vs. Southern Petrochemical Industries Corpn. Ltd. (supra) C) CIT Vs. Southern Hydro Carbon Ltd. (supra) D) Bharat Aluminium Co. Ltd. Vs. CIT,(2010)187Taxman111(Delhi HC) E) Swati Synthetics Ltd. Vs. ITO, (2010) 38 SOT 0208 (Mumbai Trib.) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowance of total amount of Rs. 2,46,20,415 & Rs. 74,44,638/-. Similarly in respect of 33 KV Power Line (Ranjithpura) 15% block also, the AO has made total disallowance of the claim of Rs. 14,69,772/-. In respect of Railway siding tracks 15% block and Railway siding Weigh bridge 15% block, the claim of the assessee for depreciation of Rs. 1,75,93,266/- and Rs. 1,74,616/- respectively was allowed by the AO. Hence it is seen that disallowance has been made by the AO in respect of two blocks i.e. 10% building block, 15% plant and machinery block and in both these blocks, depreciation has been allowed by AO on some items whereas the AO disallowed depreciation on some items in each of these two blocks. In the light of these facts, now we examine the applicability of various judgements cited by ld. AR of assessee as noted above. 8. We first examine the applicability of Tribunal order rendered in the case of Swati Synthetics Ltd. vs. ITO (supra). Para 7.15 of this Tribunal order is relevant and hence the same is reproduced from page no. 61 of paper book. "7.15 In the light of above discussions, the condition/requirement of s. of word 'used for the purpose of business' as provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o exist for the reason that all the assets in that block are transferred during the previous year."" 9. From the above Para reproduced from this Tribunal order, it is seen that it is held by the Tribunal that the existence of individual asset in block of assets itself amounts to use for the purpose of business. The Tribunal also held that 'used for the purpose of business' as provided in section 32 (1) of IT Act for the concept of depreciation on block of assets can be summarized by saying that use of individual asset for the purpose of business can be examined only in the first year when the asset is purchased and in subsequent years, use of block of assets for the purpose of business is satisfied on this finding alone that there is existence of asset in the block of assets. In the present case, this is not the case of the AO that some asset of building block and plant & machinery block are not existing in the respective block of assets. In respect of each of these two blocks, the AO is also allowing depreciation in respect of some assets included in these two blocks. Hence in our considered opinion, part amount of depreciation disallowed by the AO in respect of some asset in eac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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