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TMI Blog2022 (5) TMI 158X X X X Extracts X X X X X X X X Extracts X X X X ..... short Ld. FAA) in appeal before it against order dated 29.02.2016 passed u/s 143(3) of the Income Tax Act (hereinafter referred to as 'the Act') by ACIT, Circle 8(1), New Delhi (hereinafter referred to as the ld. Assessing officer or in short 'Ld. AO'). 2. The assessee has raised following ground of appeal :- "The learned CIT(A) erred on facts and in law in disallowing expenses on account of additional depreciation of Rs. 6,11,277." 3. The facts in brief are that during the relevant AY appellant has claimed additional depreciation of Rs. 6,11,277/- on addition of new plant and machinery of Rs. 61,12,773/- as under :- Particular Addition more than 180 days Addition less than 180 days Additional depreciation Tools Nil 61,12, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the 31st day of March, 2005 and dispensed with the condition of additional depreciation to be allowed to a new industrial undertaking and the condition of expansion in installed capacity". It claimed that circular makes it is clear that additional depreciation is to be allowed on new plant and machinery acquired and installed after 31st day of March, 2005. There is no requirement that additional depreciation is to be allowed to a new industrial undertaking or there should be expansion of installed capacity. 3.2.1 It was submitted that the Ld. AO has not disputed the fact that plant & machinery were new. Hence, the appellant fulfils the condition laid down u/s 32 (1) (iia). 3.2.2 As with regard to the findings of the Ld. AO that tools ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any one previous year. In view of the provisions of section 32(iia) as well as the explanatory notes on the provisions of the Finance Act, 2005- Circular No. 3/2006 dated 27.02.2006, it is evident that additional depreciation is to be allowed only on new plant and machinery acquired and installed after 31st day of March, 2005. There is no requirement that additional depreciation is to be allowed to a new industrial undertaking or there should be expansion of installed capacity, as interpreted by AO. Therefore, the findings of AO to that extent are incorrect. Similarly, AO has also interpreted that tools have not been installed. This interpretation of AO is also incorrect since in order to use the tools, it is not necessary to install th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble for appellant to manufacture switchgear products. Hence, the same are in the nature of 'Plant & Machinery. It was submitted that in the assessment order also tools, dies, jigs etc. have been treated as Plant & Machinery and 15% depreciation on the same has been allowed. However, the same have not been treated as Plant & Machinery only for the purpose of additional depreciation. Therefore, the stand taken in the assessment order is contradictory in itself, in-as-much-as, as on the one hand the new plant & machinery and tools, dies, jigs etc. have been considered as 'Plant & Machinery' and normal depreciation @ 15% has been allowed on the other hand the same have not been considered as eligible for additional depreciation. In support of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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