TMI Blog2023 (11) TMI 639X X X X Extracts X X X X X X X X Extracts X X X X ..... see simply credited the Schedule of fixed assets of Padi school - The said addition was made under the head land and building , which had an opening WDV - there is no acquisition of any new asset. As per the written submission filed on 22.01.2020, the amounts were stated to be utilized for improvement and acquisition of other fixed assets. However, there is no acquisition of any new fixed assets. The conditions as laid down in sub section (1A) of Sec.11 stood violated and hence such amount cannot be included for the purposes of arriving at application of income . Thus, the AO s inclusion of profit on sale of property at Thangam colony for arriving at the gross receipts and also for not considering the said amount for the purposes of arriv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R: This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals), Chennai, dated 31.01.2020 relevant to the assessment year 2012-13. 2. The appeal filed by the assessee is delayed by 159 days in filing the appeal before the Tribunal due to outbreak of COVID-19 pandemic and accordingly, the delay is condoned and admitted the appeal for adjudication. 3. Brief facts of the case are that the assessee society manually filed its return of income on 20.05.2013. The Assessing Officer has noticed from the return that the gross income of the assessee as per its Income Expenditure (I E) account was ₹.50,95,835/-. However, a perusal of the balance sheet of the assessee, along with i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay be noted that the reminder to the notice under section 142(1) of the Act was also served on the Authorised Representative of the assessee, Shri.G. Thangaraj. Yet, there was no response from the assessee. In the reminder letter, it was specifically mentioned that the assessment will be completed as a 'best judgment assessment , in case of default by the assessee on the date of hearing, viz., 26.03.2015. Still, the assessee has not responded, even to this reminder letter. Hence, the Assessing Officer has completed the 'best judgement assessment under section 144 of the Act dated 20.05.2013 assessing the income of the assessee at ₹.3,28,37,842/- after making various additions. 4. After filing of appeal before the ld. CIT(A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee. 6. On being aggrieved, the assessee is in appeal before the Tribunal. When the appeal was taken up hearing, none appeared on behalf of the assessee despite various opportunities afforded. Hence, we proceed to decide the appeal on merits after hearing the ld. DR. 7. We have heard the ld. DR, perused the materials available on record and gone through the orders of authorities below including the written submissions filed before the ld.CIT(A). The case of the assessee is that the depreciation could not have been denied since the Hon ble Apex Court had allowed depreciation despite the fact that the assets concerned were claimed towards application of income in the earlier years. It is also the case of the assessee that such d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is no dispute on the fact that the assessee had derived a net consideration of Rs. 3,21,44,631/- on sale of property at Thangam colony. The sale proceeds have not been utilised for acquiring another capital asset. The assessee simply credited the Schedule of fixed assets of Padi school with an amount of Rs. 3,52,56,950/-. The said addition was made under the head land and building , which had an opening WDV of Rs. 1,80,06,371/-. In other words, there is no acquisition of any new asset. As per the written submission filed on 22.01.2020, the amounts were stated to be utilized for improvement and acquisition of other fixed assets. However, there is no acquisition of any new fixed assets. The conditions as laid down in sub section (1A) of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e expenditure was already claimed towards application of income. Thus, the AO should not have reduced the claim of depreciation while arriving at the application of income. 6.3.5 To sum up, the AO is directed to consider the application of income at Rs. 63,84,221/- (which means the claim of depreciation is allowed) against the income to be applied of Rs. 31654396/- (which represents 85% of gross receipts of ₹.3,72,40,466/-. Accordingly ground no. 4 pertaining to the claim of depreciation is allowed and ground no. 5, 6 7 are dismissed. 8. Despite various opportunities afforded, none appeared on behalf of the assessee or filed any written submissions in support of its claim. Upon perusal of the appellate order, we find no rea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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