Tribunal decisions on appeals for provisions, disallowances, and excess depreciation uphold assessee's claims

The tribunal allowed the assessee's appeal for statistical purposes, dismissed the departmental appeal regarding the addition of provision for contingencies, and upheld the deletion of disallowance towards advances and deposits written off and the excess depreciation claimed. The decisions were based on factual findings, legal precedents, and the principle of avoiding double taxation.

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Issues Involved:
1. Disallowance of foreign exchange fluctuation loss.
2. Addition of provision for contingencies while computing book profits under section 115JB.
3. Deletion of disallowance towards various advances and deposits written off.
4. Disallowance of excess depreciation claimed by way of revised return.

Detailed Analysis:

Issue 1: Disallowance of Foreign Exchange Fluctuation Loss
The primary issue in the assessee's appeal (ITA No. 782/Kol/2012) is whether the CIT(A) was justified in disallowing the foreign exchange fluctuation loss incurred by the assessee, both realized and notional, amounting to Rs. 21,25,864 and Rs. 75,07,500 respectively. The assessee had availed a foreign currency loan to prepay high-cost debentures and had restated the loan at the end of the financial year, resulting in a gain which was not offered to tax based on a tribunal decision. The tribunal decision was prior to the Supreme Court judgment in Woodward Governor of India (P) Ltd. The tribunal remanded the issue back to the AO to determine whether the foreign currency loan was utilized for working capital or acquiring fixed assets, which would affect the treatment of the exchange fluctuation loss under section 43A of the Act. The AO was directed to reconsider the issue in light of the Supreme Court decision and the pending appeal before the Calcutta High Court.

Issue 2: Addition of Provision for Contingencies While Computing Book Profits Under Section 115JB
In the departmental appeal (ITA No. 930/Kol/2012), the issue was whether a sum of Rs. 18,86,02,604 representing provision for contingencies should be added back while computing book profits under section 115JB. The assessee had created provisions in earlier years and added them back while computing book profits. Upon writing back the provisions, the assessee reduced the amount from book profits to avoid double taxation. The CIT(A) deleted the addition, and the tribunal upheld this decision, finding no infirmity in the CIT(A)'s order and confirming that the provision for contingencies should not be added back while computing book profits.

Issue 3: Deletion of Disallowance Towards Various Advances and Deposits Written Off
In the departmental appeal (ITA No. 931/Kol/2012), the issue was the deletion of disallowance of Rs. 37,087 towards various advances and deposits written off. The assessee had written off these amounts as irrecoverable, claiming them as a deduction under section 37(1) read with section 28 of the Act. The AO disallowed the claim, treating it as a capital loss. The CIT(A) deleted the disallowance, and the tribunal upheld this decision, agreeing that the write-off was in the ordinary course of business and should be considered a trading loss.

Issue 4: Disallowance of Excess Depreciation Claimed by Way of Revised Return
The last issue in the departmental appeal (ITA No. 931/Kol/2012) was the disallowance of excess depreciation claimed by way of a revised return. The assessee had not claimed depreciation in the original return for the Asst Year 1999-2000 but later claimed it through a rectification petition, which was rejected. The assessee continued to claim depreciation on the reduced written down value in subsequent years. The CIT(A) allowed the additional depreciation, and the tribunal upheld this decision, following earlier tribunal orders in the assessee's favor for previous years.

Conclusion
The tribunal allowed the assessee's appeal for statistical purposes, dismissed the departmental appeal regarding the addition of provision for contingencies, and upheld the deletion of disallowance towards advances and deposits written off and the excess depreciation claimed. The decisions were based on the factual findings, legal precedents, and the principle of avoiding double taxation.

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