2012 (8) TMI 355

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....d that the same be cancelled and be suitably modified. The appellate order passed by the learned CIT (Appeals) in defiance of the ratio of the judgments of the hon'ble High Court of Gujarat and the ITAT, Ahmedabad Bench which are binding on all the Income Tax authorities is perverse. 2. The learned CIT (Appeals) has grossly erred in law and on facts of the case in confirming the order u/s. 143(3) of the I.T. Act passed by the AO for A.Y. 2007-08. 3. The learned CIT(Appeals) has grossly erred in law and on facts of the case in confirming the disallowance made by the AO of the appellant's legitimate claim for depreciation of Rs. 2,44,99,739/-, in utter disregard to the judgment of the hon'ble High Court of Gujarat in the case of CIT v/s....

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....n Trust 198 ITR 598 (Guj). The CIT (A) considered this case law and also followed the decision of ITAT 'A' Bench in case of Ahmedabad South Indian Association in ITA Nos. 2331/Ahd/2004, 84/Ahd/2006, 2782/Ahd/2007 and 3208/Ahd/2007, dated 24.07.2009 where Hon'ble 'A' Bench had observed as under: "In our considered view the Hon'ble Gujarat High Court in the above referred case were concerned with the computation of income of the trust in the normal commercial sense and had not considered whether the amount of depreciation would be considered as application to arrive at 85% of the receipts in addition to investment in the assets already allowed as application in the earlier year. The allowance of depreciation as further application of recei....

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....rival submissions and perused the material on record. In our considered view there is no case for interference in the order of ld. CIT (A). 10. The issue of depreciation on the assets owned by the assessee trust and used in their activities is allowable in view of the two judgments referred to by the assessee in the written submissions. In addition to this, above view is supported by the decision of Hon. Madhya Pradesh High Court in CIT vs. Raipur Pallottine Society (1989) 180 ITR 579 (M.P.) wherein Hon. High Court held as under: "Depreciatiojn is the exhaustion of the effective life of a fixed asset owing to "use" or obsolescence. It may be computed as that part of the cost of the asset which will not be recovered when the asset is f....