Tribunal Upholds 60% Depreciation Rate for ATM Machine, Revenue Appeal Dismissed

The Tribunal upheld the higher depreciation rate of 60% for the ATM machine, aligning with the precedent set by the Hon'ble Bombay High Court in a similar case. The appeal by the Revenue, challenging the CIT(A)'s allowance of higher depreciation, was dismissed as the Tribunal found no perversity in its decision. The judgment favored the appellant, a subsidiary of a bank, in categorizing the ATM as eligible for the increased depreciation rate, similar to the treatment of UPS in a previous case.

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Issues:
- Depreciation rate on ATM machine

Analysis:
The appeal in question pertains to the depreciation rate applicable to an ATM machine. The primary issue raised by the Revenue was the allowance of depreciation at 60% by the CIT(A) as opposed to the 15% allowed by the Assessing Officer (AO). The crux of the matter revolved around whether an ATM should be categorized as a cash dispensing machine with a projector or as plant and machinery, thus impacting the depreciation rate.

The appellant, relying on a judgment from the Hon'ble High Court in a similar case involving UPS, argued for the higher depreciation rate. The High Court had previously considered a case where depreciation on UPS was allowed at 60% despite being categorized as plant and machinery. The respondent in the present case, a subsidiary of a bank, had purchased various assets including UPS, ATM machines, and software licenses to provide technology services. The AO had disallowed the higher depreciation claim on the grounds that UPS and ATMs should be depreciated at 15% as they were part of plant and machinery.

The Tribunal, after reviewing the facts and the previous judgment, concluded in favor of the assessee. It noted that the Revenue failed to demonstrate any perversity in the Tribunal's findings on the matter. Consequently, the appeal by the Revenue was dismissed, aligning with the precedent set by the Hon'ble Bombay High Court in a similar case involving the same assessee.

In conclusion, the Tribunal upheld the higher depreciation rate of 60% for the ATM machine, following the principles established in the earlier judgment and dismissing the Revenue's appeal. The decision was pronounced on 22-11-2016.

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