TaxTMI Login
AI Drafter ✕
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
Just a moment...
AI Drafter ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) Whether Section 50 of the Income-tax Act, 1961 is invocable where the asset sold, though arguably depreciable, was never subjected to or allowed depreciation; and whether the Tribunal's holding refusing application of Section 50 is perverse.
Analysis: Section 50 applies to a transfer of a capital asset forming part of a block of assets "in respect of which depreciation has been allowed"; therefore the provision requires that depreciation must have been allowed in relation to the block. The Tribunal found that no depreciation had ever been allowed in respect of the subject asset; this factual finding places the matter outside the reach of Section 50. The Tribunal's reliance on and distinction from the decision cited by the Revenue is legally material because that decision expressly involved a building which had undergone depreciation; a single instance of allowed depreciation is sufficient to attract Section 50, but absent any allowance of depreciation the provision does not apply. The Tribunal's conclusion that Section 50 is not attracted on the facts was a reasoned application of the statutory text to the factual finding that depreciation was not allowed.
Conclusion: The Tribunal's decision that Section 50 is not applicable because depreciation was never allowed in respect of the asset is upheld; the substantial question(s) of law are answered against the Revenue and in favour of the Assessee.
TaxTMI 
