Tribunal allows depreciation at 25% for electric fittings, remands for verification. Filtration expenses as revenue.

The Tribunal allowed depreciation at 25% on electric fittings, considering them integral parts of Plant & Machinery. The issue was remanded for verification. Filtration expenses were allowed as revenue expenditure, with the Tribunal directing their deduction but withdrawal of allowed depreciation. The assessee's appeal was allowed.

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Issues involved:
The judgment involves issues related to the disallowance of depreciation on electric fittings and the disallowance of filtration expenses claimed as revenue expenditure.

Disallowance of depreciation on electric fittings:
The appellant claimed depreciation on electrical fittings at 25%, while the Assessing Officer allowed depreciation at 15% as per the Income Tax Act. The Commissioner of Income Tax(Appeals) upheld the disallowance. The Tribunal found that the fittings were integral parts of the Plant & Machinery and should be allowed depreciation at 25%. However, as details of the assets were not provided, the issue was remanded back to the Assessing Officer for proper verification and fresh adjudication.

Disallowance of filtration expenses claimed as revenue expenditure:
The appellant claimed filtration expenses as revenue expenditure, but the Assessing Officer treated it as capital expenditure due to entries in the register. The Commissioner of Income Tax(Appeals) confirmed the disallowance. The Tribunal, referring to a previous order, allowed the deduction of filtration expenses as revenue expenditure, stating that they were day-to-day consumables without creating any capital asset. The Tribunal directed the Assessing Officer to allow the deduction of filtration expenses but to withdraw the depreciation allowed. The appeal of the assessee was allowed in this regard.

The judgment was signed, dated, and pronounced in the Court on 9th July 2010.

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