Tribunal Upholds Assessee's Claim for Additional Depreciation on Machinery

The Tribunal upheld the Assessee's entitlement to additional depreciation under section 32(1)(iia) for machinery used in embroidery work on fabrics. The decision was based on legal precedents supporting the allowance of additional depreciation for such machinery, as established in previous Tribunal orders and Supreme Court rulings. The Revenue's appeal challenging the grant of additional depreciation and the Assessee's Cross Objection were both dismissed by the Tribunal.

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Issues:
Grant of additional depreciation u/s.32(1)(iia)

Analysis:
The appeal and cross objection arose from the order of the CIT(A)-II, Surat, regarding the grant of additional depreciation u/s.32(1)(iia). The Assessee, engaged in embroidery work on fabrics, claimed 20% additional depreciation on machinery installed, which was initially disallowed by the AO. The CIT(A) considered previous Tribunal orders favoring the Assessee and directed to allow the claim. The ITAT, after hearing both sides, referred to a decision in the case of M/s. Hari Fashions and Haripriya Processor Pvt. Ltd., holding that machinery used for embroidery processing is entitled to additional depreciation u/s.32(1)(iia). Citing the legal precedent set by the Hon'ble Supreme Court in the case of S.S. & Brothers Pvt. Ltd., the Tribunal dismissed the Revenue's grounds, upholding the Assessee's entitlement to additional depreciation.

The Cross Objections filed by the Assessee were in support of the CIT(A)'s decision and did not raise any new legal or factual questions for adjudication. Therefore, the Cross Objection was dismissed. Ultimately, both the Revenue's appeal and the Assessee's Cross Objection were dismissed by the Tribunal based on the aforementioned legal analysis and precedents cited.

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