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TMI Blog2023 (7) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 of 2015 for the assessment year 2007-08. 3. Learned advocate for the appellant has sought the following substantial questions of law to be framed. (i) "Whether in the facts of the case as well as law, the Income Tax Appellate Tribunal was justified in upsetting the finding given by the CIT(A) in allowing carry forward and set off of unabsorbed depreciation without any limitation of period?" (ii) "Whether in the facts of the case as well as law, the Income Tax Appellate Tribunal was justified in upholding the finding of the CIT(A) which is based on CBDT's circular No.14 of 2001 as the same circular does not apply to carry forward and set off of unabsorbed depreciation for the period prior to A.Y. 2002-03?" (iii) "Whether in the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellate Tribunal against the above order of Commissioner of Income Tax (Appeal) on the issue of disallowance of unabsorbed brought forward depreciation amounting to Rs. 5,22,76,985/-. The Tribunal has dismissed the appeal of the revenue. 3.4 The Tribunal stated and held, "3.4 During the course of the hearing, the Ld. D. R. Mr. Shramdeep Sinha fairly admitted this issue is squarely covered by Jurisdictional High Court which has considered the amendments made in the Finance Act, 2001 and CBDT Circular No. 14 of 2002, which clarified that the restriction of 8 years for carry forward and set off of unabsorbed depreciation had been dispensed with, the unabsorbed depreciation from Assessment Year 1997-98 to 2001- 02 got carried forward to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer to reopen the assessment on the said ground, the Division Bench observed thus in para 30, "The reason given by the Assessing Officer under section 147 is that Section 32(2) of the Act was amended by Finance Act No.2 of 1996 w.e.f. A.Y. 1997-98 and the unabsorbed depreciation for the A.Y. 1997-98 could be carried forward up to the maximum period of 8 years from the year in which it was first computed. According to the Assessing Officer, 8 years expired in the A.Y. 2005-06 and only till then, the assessee was eligible to claim unabsorbed depreciation of A.Y. 1997-98 for being carried forward and set off against the income for the A.Y. 2005-06. But the assessee was not entitled for unabsorbed depreciation of Rs.43,60,22,158/- fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .3 The Division Bench of this court finally held thus in para 38, "Therefore, it can be said that, current depreciation is deductible in the first place from the income of the business to which it relates. If such depreciation amount is larger than the amount of the profits of that business, then such excess comes for absorption from the profits and gains from any other business or business, if any, carried on by the assessee. If a balance is left even thereafter, that becomes deductible from out of income from any source under any of the other heads of income during that year. In case there is a still balance left over, it is to be treated as unabsorbed depreciation and it is taken to the next succeeding year. Where there is current depr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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