TMI Blog2018 (8) TMI 2112X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of the assessee, has been decided for assessment year 2010-11 on 08.08.2017 in favour of the assessse. DR was fair enough not to controvert these facts and findings. Accordingly, the appeal of the revenue on this issue is dismissed. Depreciation on system software of the computer - @ 60% or 25% - as per AO application software are not integral part of the computer and held that the application software is intangible assets and they are eligible for depreciation u/s. 32 of the act @ 25% - HELD THAT:- Special Bench in the case of Datacraft India Ltd [ 2010 (7) TMI 642 - ITAT, MUMBAI] held that any device when they are used along with computer and when their functions are integrated with the computer comes within the ambit of the exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that assessee has not properly worked out the disallowance therefore the assessee was asked to explain why not the disallowance should be worked out as per section 14A of the act. The assessee responded that it has made investment in mutual fund out of its own sources and has not used borrowed fund for making investment. The assessing officer stated that assesse has not submitted day to day fund flow, therefore, in its absence, the claim of the assessee that it has not used interest bearing fund for the investment remain unsubstantiated. Consequently, the assessing has applied the formula provided in rule 8D(2)(1) of the act and disallowed an amount of Rs.83,62,672/-. Therefore an addition of Rs. 78,84,214/- was made after reducing an am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1/Ahd/2013 for assessment year 2010-11 on 08.08.2017 in favour of the assessse. Relevant part of the decision of the Co-ordinate Bench is reproduced as under:- 30. We find that it is an undisputed fact that the own funds of the appellant company are far more in excess of the investments. Therefore, the ratio laid down by the Hon ble High Court of Bombay in the case of Reliance Utilities and Power Ltd. 113 ITR 340 and Hon ble Gujarat High Court in the case of Raghuvir Synthetics Ltd. in Tax Appeal No. 829 of 2007 squarely apply on the facts of the case. Therefore, we do not find any error or infirmity in deleting the disallowance of the interest component of Rs. 60,63,668/-. 31. Insofar as the disallowance on account of administra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs the AR stated that CIT(A) in the appellant's own case for the A.Y.2009-10 A.Y.2010-11 on the same issue has allowed the appeal. He also quoted that The IT AT Ahmedabad Bench in the case of Voltamp Transformers Ltd. ITA No. 1676/Ahd/2012 for A.Y. 2009-2010 dated 22-03-2013 has dismissed the Revenue Appeal by holding that the assessee is entitled to the depreciation at higher rate. I have considered the facts of the case as stated by the appellant as well as the AO in his assessment order. I have also considered the submission of the appellant and the case laws referred by the AO as well as the appellant. The appellant-has relied on Hon'ble ITAT's order in the case of Voltamp Transformers Ltd. ITA No. 1676/Ahd/20l2 wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly equipment which performs such functions that can be called as 'computer'. All the input and output devices which in fact support in the receipt^ of input and outflow of the output are also part of the computer'. Therefore the ratio which can be culled out for the aforesaid decision for Hon'ble special bench (specifically para 31.4 of the order) , it is to be seen that the Hon'ble special bench has clearly held that when a particular hardware or software is used along with the computers and when their functions are integrated with a computer or in other words when a device is use as part of a computer or in other words when the device is use as part of the computer in its functions, even though it may be have in user ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in the case of any block of assets, such percentage on the written down value thereof as may be prescribed as per rule 5(1) and appendix 1 of the Income Tax Rule. As per Rule 5(1) of the I.T. Rule depreciation of any block of assets shall be calculated at the percentage specified in second column of the Table in Appendix 1 to this rule. The Appendix-1 as per item number 5 provides depreciation @ 60% on computer including computer software. Further Note No. 7 to the Appendix-1 states that computer software means any computer program recorded on any disc, tape, performated, media or other information storage device. In this connection, we have noticed that Special Bench in the case of Datacraft India Ltd. (2010) 40 SOT 295 (Mum)(SB) held t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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