Trust's Depreciation Disallowance Appeal Dismissed; Double Deduction Rejected; Carry Forward Allowed The Revenue's appeal challenging the disallowance of depreciation claimed by a Trust under section 12A of the Income Tax Act for the assessment year ...
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The Revenue's appeal challenging the disallowance of depreciation claimed by a Trust under section 12A of the Income Tax Act for the assessment year 2009-10 was dismissed by the Tribunal. The Tribunal upheld the CIT(A)'s decision based on the Bombay High Court's judgment, rejecting the Revenue's argument of double deduction. Additionally, the Tribunal affirmed the allowance of carry forward of the current year's assessed deficit for set-off in subsequent years, in line with the High Court's precedent. The appeal was dismissed on 29/02/2016.
Issues Involved: 1. Disallowance of depreciation claimed by the assessee. 2. Allowance of carry forward of current year's assessed deficit for set-off in subsequent years.
Analysis: 1. The appeal by the Revenue contested the order of CIT(A)-7, Mumbai, concerning the assessment year 2009-10. The primary issue revolved around the disallowance of depreciation claimed by the respondent assessee, a Trust registered under section12A of the Income Tax Act. The Assessing Officer had denied the claim for depreciation on assets, asserting it as double deduction. However, CIT(A) allowed the claim citing the judgment of the Bombay High Court in CIT vs. Institute of Banking Personnel Section. The Revenue challenged this decision, but the Tribunal upheld CIT(A)'s decision based on the binding precedent of the High Court and other supporting decisions, leading to the dismissal of the Revenue's appeal.
2. The second issue raised by the Revenue concerned the direction of CIT(A) to allow the carry forward of the current year's assessed deficit for set-off in subsequent years. The Tribunal found this direction consistent with the decision of the Bombay High Court in the Institute of Banking Personnel Selection case. Consequently, the Tribunal affirmed CIT(A)'s decision on this aspect as well, concluding that no error could be identified. As a result, the appeal by the Revenue was dismissed, and the order was pronounced on 29/02/2016.
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