9911796707
TMI Blog2022 (3) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... State Co-operative Societies Act, 1960. The assessee filed return of income after claiming depreciation u/s 32 of Rs. 1,60,23,529/- and deduction u/s 80P of Rs. 33,43,57,235/-. While completing assessment, the Ld. AO disallowed the deduction of depreciation of Rs. 1,60,23,529/- fully. Regarding the deduction u/s 80P, the Ld. AO made a part-disallowance of Rs. 5,02,23,957/- in so far it related to the income from CAP storage and allowed the remaining deduction of Rs. 28,41,33,278/-. In respect of the allowed portion of deduction of Rs. 28,41,33,278/- u/s 80P, the Ld. AO also made a protective disallowance of Rs. 1,63,23,529/- on account of consequential effect of equal amount of depreciation disallowance already made. Being aggrieved by the order of Ld. AO, the assessee filed appeal to Ld. CIT(A). During appellate proceeding, the Ld. CIT(A) deleted the disallowance of depreciation u/s 32 of Rs. 1,60,23,529/-, confirmed the disallowance of deduction u/s 80P of Rs. 5,02,23,957/- and confirmed the protective disallowance partly to the extent of Rs. 1,18,52,613/-. Being aggrieved by the order of Ld. CIT(A), the assessee has preferred this appeal and now before us. 4. Ground No. 1: 4.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ein the warehouseman takes custody of the goods deposited by the depositor and includes a place of storage of goods under controlled conditions of temperature and humidity" Section 2(d) of The Madhya Pradesh Agricultural Warehouse Act, 1947: "Warehouse" means a building or protected enclosure which is used or may be used for the purpose of storing agricultural produce" Analyzing these definitions, the Ld. A/R argued that nowhere these definitions prescribe that only a permanent structure is a warehouse. He further submitted that these definitions clearly prescribe that even a protected place or protected enclosure used for the purpose of storage, is also a "warehouse". 4.5 Then the Ld. AO made a detailed submission on the nature and characteristics of CAP storage, which can be summed up as under: (i) CAP Storage is a "Cover and Plinth" Storage wherein a plinth is constructed upto a certain level, normally 14", from the ground level. Such plinth is enclosed by a waterproof cover. The cover is held down by nets and nylon lashing. Thus CAP storage is a protected place or protected enclosure for storage of commodities. (ii) CAP storage is a legally approved storage. The Ld. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act to be applied at any future time in such a way as to give effect to the true original intention. Accordingly the interpreter is to make allowances for any relevant changes that have occurred, since the Act's passing, in law, social conditions, technology, the meaning of words, and other matters. Just as the US Constitution is regarded as 'a living Constitution', so an ongoing British Rct is regarded as 'a living Act'. That today's construction involves the supposition that Parliament was catering long ago for a state of affairs that did not then exist is no argument against that construction. Parliament, in the wording of an enactment, is expected to anticipate temporal developments. The drafter will try to foresee the future, and allow for it in the wording. An enactment of former days is thus to be read today, in the light of dynamic processing received over the years, with such modification of the current meaning of its language as will now give effect to the original legislative intention. The reality and effect of dynamic processing provides the gradual adjustment. It is constituted by judicial interpretation, year in and year out. It also compri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /R and refrain from repeating the same here for the sake of brevity. But after a thoughtful consideration of the same, we find that CAP storage is a protected place for storage of commodities approved by the statutory Orders. In view of these factual submissions and legal position, we feel that the CAP storage must be held to be a "warehouse" for the purpose of section 80P and we hold so. At this stage, we also note that the section 80P is a beneficial provision and the purpose is to incentivize the warehousing activity of co-operative societies. Therefore, the interpretation of section 80P must be liberal so as to advance the avowed objective. Taking into account all these aspects, we are persuaded to conclude that the income from letting of CAP storage derived by the assessee is eligible for deduction u/s 80P and there is no justification in denying the same to the assessee. Therefore, we delete the disallowance made by lower authorities. This ground is, therefore, allowed. 5. Ground No. 2: 5.1 In this ground, the assessee has challenged the protective disallowance of Rs. 1,18,52,613/- out of deduction u/s 80P confirmed by the Ld. CIT(A). 5.2 Facts as noted in the beginning an ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
