Tribunal Upholds Higher Depreciation on Moulds, Disallows Belated EPF Payments

The Tribunal upheld the Ld. CIT(A)'s decision allowing higher depreciation on moulds at 30% based on previous rulings. However, the Tribunal agreed with the AO's disallowance of belated payments for employee's provident fund contributions, following a judgment by the Hon'ble Gujarat High Court. The Revenue's appeal was partly allowed, with the Tribunal dismissing the appeal on the first issue and upholding the AO's decision on the second issue.

---

---

Issues:
1. Allowability of higher depreciation on dies and moulds at 30%.
2. Addition on account of delayed payment of employee's contribution to provident fund.

Issue 1: Allowability of higher depreciation on dies and moulds at 30%

The case involved the Revenue's appeal against the Ld. CIT(A)'s order for A.Y. 2006-07 regarding the deletion of depreciation on moulds at 30%. The AO disallowed the higher depreciation claimed by the Assessee, limiting it to 15% instead of 30%. However, Ld. CIT(A) allowed the appeal based on the decision of Hon'ble ITAT in the Assessee's own case for A.Y. 2001-02, where it was held that the moulds used for manufacturing plastic goods were eligible for higher depreciation. The Co-ordinate Bench of Tribunal also upheld this decision in A.Y. 2001-02. The Revenue challenged this decision, but failed to provide any contrary binding decision or evidence to support their case. The Tribunal found no reason to interfere with Ld. CIT(A)'s order, dismissing the Revenue's appeal.

Issue 2: Addition on account of delayed payment of employee's contribution to provident fund

The second ground of appeal involved the addition made by the AO on account of delayed payment of Employee's contribution to provident fund. The AO disallowed the contribution as it was paid after the prescribed due dates. However, Ld. CIT(A) deleted the addition, citing that the contributions were paid before the due date of filing the return. The Revenue challenged this decision, referring to a judgment by the Hon'ble Gujarat High Court in a different case. The Tribunal, considering the undisputed fact that the payments were made after the prescribed due dates, upheld the AO's decision to disallow the belated payments. Consequently, this ground of the Revenue's appeal was allowed, and the overall appeal was partly allowed.

In conclusion, the judgment addressed the issues of higher depreciation on dies and moulds and delayed payment of employee's contribution to provident fund. The Tribunal upheld Ld. CIT(A)'s decision on the first issue, allowing the higher depreciation based on previous rulings. However, on the second issue, the Tribunal agreed with the AO's disallowance of the belated payments, following a judgment by the Hon'ble Gujarat High Court.

---