Supreme Court affirms relief for depreciation write-back allowing reassessment for charitable purposes.

The Supreme Court upheld the High Court's decision to grant relief to the appellant for depreciation write-back. The Court emphasized the importance of allowing the assessee to write back depreciation for the relevant year and preceding years, ensuring no surprise disallowances after consistent allowance. The assessing officer was directed to adjust the assessment, permitting the recomputed income with written-back depreciation to be carried forward for subsequent years for charitable purposes. The Court dismissed the appeal, affirming the High Court's ruling and relief granted to the appellant, without finding justification for interference.

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Issues:
1. Interpretation of law regarding depreciation allowance.
2. Granting relief to the appellant for depreciation write-back.
3. High Court's decision and dismissal of the appeal.

Interpretation of Law Regarding Depreciation Allowance:
The Supreme Court, comprising A. K. Sikri and Ashok Bhushan, JJ., reviewed a case where the High Court answered a legal question favoring the Revenue. However, the appellant was granted relief due to the issue of disallowing depreciation after allowing it for several years. The Court acknowledged that the assessee should be permitted to write back the depreciation for the concerned year and even for previous years. The judgment highlighted that the assessing officer should adjust the assessment by determining a higher income and allowing the recomputed income with the depreciation written back by the assessee to be carried forward for subsequent years for charitable purposes.

Granting Relief to the Appellant for Depreciation Write-back:
The Court emphasized the principle that an assessee should not be taken by surprise by disallowing depreciation that had been consistently allowed in previous years. The judgment underscored the importance of allowing the assessee to write back depreciation for the relevant year and even for preceding years. It was clarified that the assessing officer should modify the assessment to reflect a higher income and permit the recomputed income with the written-back depreciation to be carried forward for subsequent years for charitable purposes. The Court upheld the benefit granted by the High Court for other assessment years, leading to the dismissal of the appeal.

High Court's Decision and Dismissal of the Appeal:
The Supreme Court, based on the High Court's decision and the relief granted to the appellant, concluded that there was no justification to interfere with the High Court's order. Consequently, the appeal was dismissed. Additionally, the Court noted that an application for intervention was not pursued as the case's merits were not examined. The judgment, therefore, affirmed the High Court's ruling and the relief provided to the appellant regarding the depreciation issue, ultimately resulting in the dismissal of the appeal.

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