TMI Blog2021 (12) TMI 1130X X X X Extracts X X X X X X X X Extracts X X X X ..... n in the Explanatory Notes to the Provisions of the Finance Act 2 issued by the CBDT, in Para 13.2 of the said Notes, it has been mentioned that the aforesaid amendment of providing balance of additional depreciation in the immediately succeeding year has been brought to remove discrimination in the manner of allowing additional depreciation on plant or machinery used for less than 180 days in the preceding year. The very objective of insertion of a new proviso to section 32(1) is that to remove discrimination and therefore it can be safely said that the same is just a curative amendment. Even there is no provision u/s. 32(1) prohibiting the balance additional depreciation in the succeeding year. - Decided against revenue. - I.T.A. No. 2109/Kol/2019 - - - Dated:- 16-12-2021 - Sanjay Garg, Member (J) And Rajesh Kumar, Member (A) For the Appellant : Akkal Dudhwewala, FCA and Rakesh Jhunjhunwala, AR For the Respondents : Amitava Bhattacharya, CIT-DR ORDER Per Sanjay Garg, Judicial Member The present appeal has been preferred by the Revenue against the order dated 17.06.2019 of the Commissioner of Income Tax (Appeals)-2, Kolkata [hereinafter referred to as & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erved that the issue is otherwise also covered by the decision of the CIT(A)-2, Kolkata vide its order dated 17.01.2019 in assessee's own case for assessment year 2014-15 vide Appeal No. 10329/CIT(A)-2/17-18. He therefore allowed the balance additional depreciation on plant and machinery claimed by the assessee in the assessment year under consideration. 5. Being aggrieved by the above action of the CIT(A), the Revenue has come in appeal before us. At the outset, the Ld. counsel for the assessee has invited our attention to the decision of the Tribunal in the own case of the assessee for assessment year 2013-14 in ITA No. 1791/Kol/2017, wherein, the Tribunal vide order dated 28.12.2018 has decided the issue in favour of the assessee by observing as under: 7. Ground No. 3 of the revenue is against the action of the Ld. CIT(A) in allowing the claim of balance additional depreciation amounting to ₹ 6,36,83,752/- on the assets which were put to use in the earlier financial year. 8. The brief facts of the case is that the AO noted that the assessee has claimed ₹ 6,36,83,752/- on account of balance additional depreciation @ 10% on the assets which were pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that this issue is no longer res integra and the Hon'ble Karnataka High Court in CIT vs Rittal (India) Ltd. 388 ITR 423 has adjudicated similar issue wherein Hon'ble High Court held as under: This appeal has been filed by the Revenue challenging the order of the Tribunal whereby full benefit of Section 32(1)(iia) of the Income Tax Act, 1961 (for short 'Act') has been given to the assessee. 2. The undisputed facts of this case are that the respondent-assessee was an existing industrial undertaking, when it had acquired and installed new plant and machinery in the financial year 2006-07 and claimed 50% of additional 20% depreciation (i.e. 10% additional depreciation) under Section 32(1)(iia) of the Act in the corresponding assessment year 2007-08. This was so claimed because admittedly the new machinery was acquired after 01.10.2006 and before 31.03.2007, meaning thereby that it was put to use for the purpose of business for a period of less than 180 days. There is also no dispute with regard to the fact that under Section 32(1)(iia), read with second proviso to 32(1)(ii) of the Act, for the assessment year 2007-08, the respondent- assessee could have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eneration or generation and distribution of power, such percentage on the actual cost thereof to the assessee as may be prescribed; (ii) in the case of any block of assets, such percentage on the written down value thereof as may be prescribed: Provided.............. (a)............ (b)............ Provided further that where an asset referred to in clause (i) or clause (ii) or clause (iia), as the case may be, is acquired by the assessee during the previous year and is put to use for the purposes of business or profession for a period of less than one hundred and eighty days in that previous year, the deduction under this sub-section in respect of such asset shall be restricted to fifty per cent of the amount calculated at the percentage prescribed for an asset under clause (i) or clause (ii) 1 or clause (iia), as the case may be: Provided also............. Provided also............. Provided also............. Provided also............. Explanation 1............. Explanation 2............. Explanation 3............. Explanation 4............. Explanation 5............. (iia) in the case of any new machinery ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the very purpose of insertion of Clause (iia) would be defeated because it provides for 20% deduction which shall be allowed. 10. It has been consistently held by this Court, as well as the Apex Court, that beneficial legislation, as in the present case, should be given liberal interpretation so as to benefit the assessee. In this case, the intention of the legislation is absolutely clear, that the assessee shall be allowed certain additional benefit, which was restricted by the proviso to only half of the same being granted in one assessment year, if certain condition was not fulfilled. But, that, in our considered view, would not restrain the assessee from claiming the balance of the benefit in the subsequent assessment year. The Tribunal, in our view, has rightly held, that additional depreciation allowed under Section 32(1)(iia) of the Act is a onetime benefit to encourage industrialization, and the provisions related to it have to be construed reasonably, liberally and purposively, to make the provision meaningful while granting additional allowance. We are in full agreement with such observations made by the Tribunal. 6. The Ld. DR could not point out any decision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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