9911796707
TMI Blog1998 (8) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... n results in avoidance of tax on book profit. 2. On the facts and circumstances of the case whether CIT(A) was correct in directing the AO not to allow depreciation of Rs. 45,63,546 only on the ground that it was a not claimed by the assessee, though in law it was allowable." 2. Briefly stated the facts of the case are that the assessee M/s Himson Textile Engg. Ind. Ltd. is a private limited company to which the provisions of s. 115J of the IT Act are applicable for the asst. yr. 1989-90. On a scrutiny of the audited accounts and report of the statutory auditor, it was found by the AO that the assessee had debited depreciation in its books at a rate higher than that prescribed in Sch. XIV of the Companies Act, 1956. A note in para 1 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rameschander the rates of depreciation mentioned in Sch. XIV of the Companies Act are mandatory in nature and are to be adopted in providing for depreciation in the accounts of the companies. Otherwise there was no purpose in incorporating the rates of depreciation in the Schedule to the Companies Act itself. The learned C.A. Shri R.N. Vepari relies on the order of the CIT(A) and the decision of the Ahmedabad Bench of the Tribunal in Dy. CIT vs. Samir Diamond Mfg. Co. (1997) 59 TTJ (Ahd) 1. 4. Having regard to the rival submissions, we uphold that order of the CIT(A) on this issue as it is squarely governed by the decision of Ahmedabad Bench of the Tribunal in Dy. CIT (Asst) vs. Samir Diamond Mfg. Co. cited supra. 5. In that case also, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of r. 5AA of the IT Rules. Grant of depreciation will fall for prima facie adjustments envisaged in s. 143(1)(a) of the IT Act. For these reasons, he increased the amount of depreciation by the impugned amount in arriving at the total income under the normal provisions of the IT Act in the course of proceedings under s. 115J of the IT Act. 8. The assessee appealed. The CIT(A), after referring to the judgments in Beco Engg. Co. Ltd. vs. CIT (1984) 41 CTR (P&H) 249 : (1984) 148 ITR 478 (P&H), CIT vs. Friends Corporation (1989) 79 CTR (P&H) 181 : (1989) 180 ITR 334 (P&H), CIT vs. Sri Someshwar Sahakari Sakhar Karkhana Ltd. (1989) 75 CTR (Bom) 135 : (1989) 177 ITR 443 (Bom) and CIT vs. Arun Textile "C" (1991) 98 CTR (Guj) 117 : (1991) 192 IT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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