Court allows depreciation for World Trade Centre & Tower, rejects Section 14A addition.

The Court upheld the allowance of depreciation for World Trade Centre and World Trade Tower buildings under Section 32 of the Income Tax Act, following a previous decision. Regarding the addition made under Section 14A read with Rule 8D, the Court agreed with the ITAT's decision that since no exempt dividend income was earned, the invocation of the provision was not justified. The Court dismissed the Revenue's appeals, finding no substantial question of law and affirming the ITAT's factual determination.

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Issues:
1. Depreciation allowance for World Trade Centre and World Trade Tower buildings under Section 32 of the Income Tax Act.
2. Addition made by the Assessing Officer invoking Section 14A of the Act read with Rule 8D of the Income Tax Rules, 1962.

Analysis:

Issue 1: Depreciation allowance for World Trade Centre and World Trade Tower buildings under Section 32 of the Income Tax Act
The High Court referred to a previous order in a different case, CIT v. Bharat Hotels Ltd., where it was decided that depreciation should be allowed to the Assessee in respect of the mentioned buildings. The Court upheld this decision, stating that the question stands answered against the Revenue.

Issue 2: Addition made invoking Section 14A of the Act read with Rule 8D of the Income Tax Rules, 1962
The Assessing Officer made an addition by invoking Section 14A of the Act read with Rule 8D. The ITAT considered certain undisputed facts, such as the Assessee not receiving dividends during the relevant year and making investments in subsidiary companies for strategic purposes. The ITAT held that since no exempt dividend income was earned, the invocation of Section 14A of the Act read with Rule 8D was not justified. The decision of the Court in CIT v. Holcim India Pvt. Ltd. was followed by the ITAT to support this conclusion.

The Revenue failed to convince the Court that the factual determination made by the ITAT was incorrect or that the decision in CIT v. Holcim Pvt. Ltd. should not apply in this case. Consequently, the Court found no substantial question of law arising and dismissed the appeals by the Revenue.

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