2014 (9) TMI 823

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....adjustment made under section 143(1)(a) in respect of sale of cylinders of Rs. 16,40,000 despite the clear provisions of section 43(6)(c)(B) of the Act?" 2. The facts leading the present Tax Appeal in nutshell are as under; 3. The assessee-Company filed its return of income on an income of Rs. 18,374/-, for which an intimation u/s. 143(1)(a) of the Income Tax Act (hereinafter referred to as 'the Act') dated 04.01.1994 was issued by the Assessing Officer. However, along with the aforesaid intimation, the Assessing Officer also forwarded an Adjustment Explanatory Sheet of the same date in which the appellant's income was increased by an amount of Rs. 12,38,611/- in respect of the 3 different items. The first two items were disallowable ....

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....the present Tax Appeal to consider the aforesaid question of law. 7. Shri. Nitin Mehta, learned Advocate appearing on behalf of the appellant-revenue has vehemently submitted that the learned Tribunal has materially erred in, prima facie, holding that the adjustment made under Section 143(1)(a) of the Act in respect of sale of cylinders of Rs. 16,40,000/-, despite the clear provisions of Section 43(6)(c)(B)(ii) of the Act. It is submitted that, as such, when initially Respondent-assessee claimed 100 per cent depreciation on the value of each cylinder, there after, it was not open to the Respondent-assessee to claim depreciation at 25% on all the cylinders, considering the same as block of assets. It is submitted that, therefore, consider....

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....urrently held the issue, whether the Respondent-assessee can claim 100 per cent depreciation on the purchase of the cylinders for an aggregate amount of Rs. 23,50,800/-, as provided under Section 143(1) (a) or whether the cylinders to be treated as forming part of block of assets, entitled to depreciation at the rate of 100 per cent or whether the deduction claimed in respect of entire costs of cylinders in view of the proviso to Sub-section (ii) of Section 43(6)(c)(B) of the Act were debatable and contentious and there can conceivably two opinions, both the learned CIT(A) as well as the learned Tribunal have rightly held that the adjustments made by the AO under the provisions of Section 32(6)(c)(B) of the Act were beyound the scope of lim....