Just a moment...

Top
FeedbackReport
×

By creating an account you can:

Logo TaxTMI
>
Feedback/Report an Error
Email :
Please provide your email address so we can follow up on your feedback.
Category :
Description :
Min 15 characters0/2000
Make Most of Text Search
  1. Checkout this video tutorial: How to search effectively on TaxTMI.
  2. Put words in double quotes for exact word search, eg: "income tax"
  3. Avoid noise words such as : 'and, of, the, a'
  4. Sort by Relevance to get the most relevant document.
  5. Press Enter to add multiple terms/multiple phrases, and then click on Search to Search.
  6. Text Search
  7. The system will try to fetch results that contains ALL your words.
  8. Once you add keywords, you'll see a new 'Search In' filter that makes your results even more precise.
  9. Text Search
Add to...
You have not created any category. Kindly create one to bookmark this item!
Create New Category
Hide
Title :
Description :
❮❮ Hide
Default View
Expand ❯❯
Close ✕
🔎 Case Laws - Adv. Search
TEXT SEARCH:

Press 'Enter' to add multiple search terms. Rules for Better Search

Search In:
Main Text + AI Text
  • Main Text
  • Main Text + AI Text
  • AI Text
  • Title Only
  • Head Notes
  • Citation
Party Name: ?
Party name / Appeal No.
Law:
---- All Laws----
  • ---- All Laws----
  • GST
  • Income Tax
  • Benami Property
  • Customs
  • Corporate Laws
  • Securities / SEBI
  • Insolvency & Bankruptcy
  • FEMA
  • Law of Competition
  • PMLA
  • Service Tax
  • Central Excise
  • CST, VAT & Sales Tax
  • Wealth tax
  • Indian Laws
Courts: ?
Select Court or Tribunal
---- All Courts ----
  • ---- All Courts ----
  • Supreme Court - All
  • Supreme Court
  • SC Orders / Highlights
  • High Court
  • Appellate Tribunal
  • Tribunal
  • Appellate authority for Advance Ruling
  • Advance Ruling Authority
  • National Financial Reporting Authority
  • Competition Commission of India
  • ANTI-PROFITEERING AUTHORITY
  • Commission
  • Central Government
  • Board
  • DISTRICT/ SESSIONS Court
  • Commissioner / Appellate Authority
  • Other
Situ: ?
State Name or City name of the Court
Landmark: ?
Where case is referred in other cases
---- All Cases ----
  • ---- All Cases ----
  • Referred in >= 3 Cases
  • Referred in >= 4 Cases
  • Referred in >= 5 Cases
  • Referred in >= 10 Cases
  • Referred in >= 15 Cases
  • Referred in >= 25 Cases
  • Referred in >= 50 Cases
  • Referred in >= 100 Cases
From Date: ?
Date of order
To Date:
TMI Citation:
Year
  • Year
  • 2025
  • 2024
  • 2023
  • 2022
  • 2021
  • 2020
  • 2019
  • 2018
  • 2017
  • 2016
  • 2015
  • 2014
  • 2013
  • 2012
  • 2011
  • 2010
  • 2009
  • 2008
  • 2007
  • 2006
  • 2005
  • 2004
  • 2003
  • 2002
  • 2001
  • 2000
  • 1999
  • 1998
  • 1997
  • 1996
  • 1995
  • 1994
  • 1993
  • 1992
  • 1991
  • 1990
  • 1989
  • 1988
  • 1987
  • 1986
  • 1985
  • 1984
  • 1983
  • 1982
  • 1981
  • 1980
  • 1979
  • 1978
  • 1977
  • 1976
  • 1975
  • 1974
  • 1973
  • 1972
  • 1971
  • 1970
  • 1969
  • 1968
  • 1967
  • 1966
  • 1965
  • 1964
  • 1963
  • 1962
  • 1961
  • 1960
  • 1959
  • 1958
  • 1957
  • 1956
  • 1955
  • 1954
  • 1953
  • 1952
  • 1951
  • 1950
  • 1949
  • 1948
  • 1947
  • 1946
  • 1945
  • 1944
  • 1943
  • 1942
  • 1941
  • 1940
  • 1939
  • 1938
  • 1937
  • 1936
  • 1935
  • 1934
  • 1933
  • 1932
  • 1931
  • 1930
Volume
  • Volume
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
TMI
Example : 2024 (6) TMI 204
By Case ID:

When case Id is present, search is done only for this

Sort By: ?
Even if Sort by Date is selected, exact match will be shown on the top.
RelevanceDate
    No Records Found
    ❯❯
    MaximizeMaximizeMaximize
    0 / 200
    Expand Note
    Add to Folder

    No Folders have been created

      +

      Are you sure you want to delete "My most important" ?

      NOTE:

      Case Laws
      Showing Results for :
      Reset Filters
      Results Found:
      AI TextQuick Glance by AIHeadnote
      No Records Found

      Case Laws

      Back

      All Case Laws

      Showing Results for :
      Reset Filters
      Showing
      Records
      ExpandCollapse
        No Records Found

        Case Laws

        Back

        All Case Laws

        Showing Results for : Reset Filters
        Case ID :

        📋
        Contents
        Note

        Note

        Note

        Bookmark

        print

        Print

        Login to TaxTMI
        Verification Pending

        The Email Id has not been verified. Click on the link we have sent on

        Didn't receive the mail? Resend Mail

        Don't have an account? Register Here

        <h1>ITAT rules in favor of assessee, deleting Rs. 6,77,095/- depreciation disallowance.</h1> <h3>M/s. Continental Device India Ltd. Versus A.C.I.T., Circle 3 (1), New Delhi</h3> M/s. Continental Device India Ltd. Versus A.C.I.T., Circle 3 (1), New Delhi - Tmi Issues Involved:1. Disallowance of Depreciation2. Application of Section 43(1) Explanation 3 of the Income Tax Act, 1961Issue-wise Detailed Analysis:1. Disallowance of Depreciation:The primary issue in the appeal was the disallowance of depreciation amounting to Rs. 6,77,095/- on various assets (Building, Plant & Machinery, Computer, Furniture & Fixture, Vehicles) purchased from Deltron Ltd. The Assessing Officer (AO) considered the depreciation claimed by the assessee as excessive and disallowed it. The assessee argued that the issue was covered in their favor by previous ITAT orders for the assessment years 2005-06 to 2006-07 and 2009-10, where similar facts and circumstances were considered.2. Application of Section 43(1) Explanation 3 of the Income Tax Act, 1961:The AO invoked Section 43(1) Explanation 3, which allows the AO to determine the actual cost of assets if they believe the main purpose of the transfer was to reduce tax liability by claiming depreciation on an enhanced cost. The AO argued that the assets purchased from Deltron Ltd. were transferred at an inflated value to claim higher depreciation. The AO used the Written Down Value (WDV) from Deltron Ltd.'s books instead of the market value for depreciation calculation.Detailed Analysis:Depreciation Disallowance:The assessee filed its return declaring an income of Rs. 4,26,58,365/-, which was processed under Section 143(1) of the Income Tax Act, 1961. During scrutiny, the AO noticed the depreciation claimed on assets purchased from Deltron Ltd. was excessive and disallowed Rs. 6,77,095/-. The assessee appealed to the CIT(A), who upheld the AO's decision. The assessee then appealed to the ITAT, arguing that the issue was already decided in their favor in previous years.Application of Section 43(1) Explanation 3:The AO's primary contention was that the assets were transferred between related entities (Deltron Ltd. and the assessee) at inflated values to claim higher depreciation. The AO believed the main purpose of the transfer was to reduce tax liability, invoking Section 43(1) Explanation 3. The AO used the WDV from Deltron Ltd.'s books, ignoring the market value and the registered valuer's report provided by the assessee.The ITAT examined the facts and previous orders. It was noted that the transfer of assets was disclosed in the Director's report and the balance sheet, contrary to the AO's claim. The agreement between the parties stated that Deltron Ltd. lacked financial resources to continue the business, necessitating the transfer. The ITAT found that the AO's assertion that the assets were transferred to reduce tax liability was not substantiated with evidence.The ITAT referred to previous judgments, including the Gujarat High Court's decision in Ashwin Vanaspati Industries v. CIT, which emphasized that the AO must provide evidence to dislodge a registered valuer's report. The ITAT concluded that the AO failed to prove that the main purpose of the transfer was to reduce tax liability. The valuation provided by the registered valuer was not shown to be incorrect or unreasonable.The ITAT also referred to the Tribunal's decision in Nirma Industries (P.) Ltd., which highlighted that the AO must establish that the main purpose of the transfer was to reduce tax liability before invoking Section 43(1) Explanation 3. The ITAT found that the AO did not fulfill this requirement and improperly invoked the provision.Conclusion:The ITAT found no justification to support the disallowance of depreciation and held that the issue was covered in favor of the assessee by previous ITAT decisions. The appeal was allowed, and the addition made by the AO on account of disallowance of depreciation was deleted. The ITAT emphasized that the AO must provide evidence to dislodge a registered valuer's report and cannot arbitrarily substitute the actual cost of assets.Result:The appeal of the assessee was allowed, and the disallowance of depreciation was deleted. The ITAT reiterated the importance of substantiating claims with evidence and following legal provisions correctly.

        Topics

        ActsIncome Tax
        No Records Found