Tribunal Upholds Disallowance of Depreciation on Plant & Machinery for Assessment Years

The appellate tribunal upheld the decision to disallow depreciation claimed by the assessee on plant and machinery for assessment years 2014-15 and 2015-16. Despite the appellant's absence and lack of convincing evidence regarding the purchase and installation of stainless steel pipes, the tribunal affirmed the lower authorities' orders. The CIT(A) and Assessing Officer's concerns about discrepancies in purchase details, lack of delivery challans, and inconsistencies in explanations led to the denial of depreciation, with the tribunal finding no grounds to overturn their decisions.

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Issues involved:
Appeals filed against orders disallowing depreciation of plant and machinery for assessment years 2014-15 and 2015-16.

Analysis:
1. The appeals were disposed of ex-parte as the assessee did not appear despite multiple notices. The issue in both appeals was the disallowance of depreciation claimed by the assessee on plant and machinery.

2. The Assessing Officer found discrepancies in the purchase of stainless steel pipes and tubes by the assessee, questioning the necessity and authenticity of the purchase. The AO disallowed the depreciation claim, suspecting it to be an attempt to siphon off black money.

3. The CIT(A) upheld the AO's decision, noting the absence of delivery challans and unsatisfactory explanations regarding installation of the pipes. The CIT(A) found inconsistencies in the appellant's claims, especially regarding the replacement of old pipes and the value of scrap generated.

4. The CIT(A) highlighted that the appellant's submission of using the pipes for replacement contradicted its claim of adding them to fixed assets. The appellant failed to provide convincing evidence of the scrap value, raising doubts about the authenticity of the purchase and installation process.

5. The appellate tribunal, after considering the detailed findings of the CIT(A) and lack of contradictory evidence, upheld the decision to disallow depreciation. The tribunal dismissed the appeals, affirming the lower authorities' orders based on the evidence and explanations presented during the proceedings.

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