9911796707
TMI Blog2021 (12) TMI 698X X X X Extracts X X X X X X X X Extracts X X X X ..... not press ground no. 2. Hence, this ground is also dismissed. In ground no. 3, assessee has challenged the validity of the impugned order on the ground that it has been passed beyond the period of limitation prescribed under section 263 of the Act. Whereas, ground no. 4, 5 and 6 are on merits. 3. Briefly the facts are, the assessee is a resident company engaged in the business of manufacturing of grey fabrics. For the assessment year under dispute, assessee filed its return of income on 24.09.2015 declaring total income of Rs. 43,30,817/-. Subsequently, assessee filed a revised return on 13.09.2017 declaring income of Rs. 42,70,870/-. Assessment in case of the assessee was completed under section 143(3) of the Act vide order dated 07.12.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the name of the Directors, the assessee's claim of depreciation and interest payment cannot be denied when the company for the purpose of its business used the assets. Learned counsel submitted, the assessee purchased the cars in earlier years and depreciation has been allowed on them in the earlier assessment years. He submitted, in the impugned assessment year, the assessee has claimed depreciation on the opening written down value (WDV). Therefore, once depreciation on the assets was allowed in the earlier assessment years, there is no scope for further examination by the AO in the impugned assessment year. Thus, he submitted, on merits also claim of depreciation and interest payment is eligible. Therefore, the assessment order canno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , not being the owner, cannot claim depreciation and interest expenditure. However, facts on record reveal that the motorcars on which the assessee claimed depreciation were purchased in the earlier assessment years. On the first car purchased on 12.01.2010 the assessee had started claiming depreciation from assessment year 2010-11 itself. Similarly, for the second car purchased on 04.11.2012, the assessee is claiming depreciation from assessment year 2012-13. For the third car purchased on 15.07.2012, the assessee is claiming depreciation from assessment year 2013- 14. The depreciation so claimed and the interest expenditure on loan availed for purchasing the motorcars have been allowed in the earlier assessment years. It is a fact on reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO in allowing assessee's claim of depreciation and interest expenses can be considered to be a plausible view. That being the case, assessment order cannot be held as erroneous. Thus, the twin conditions of section 263 of the Act remain unsatisfied. For this reason the impugned order passed by learned PCIT cannot be sustained. Consequently, we set aside the impugned order of learned PCIT passed under section 263 of the Act and restore the assessment order passed by the AO for the impugned assessment. 10. In view of our aforesaid decision, the ground raised on the issue of limitation having become academic, we feel it unnecessary to deal with it. 11. In the result, appeal is allowed as indicated above. Order pronounced in the open c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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