2016 (1) TMI 945

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....the Assessment Year (AY) 2007-08. 2. The first issue projected by the Revenue concerns the acceptance by the ITAT of the Assessee's case for allowing depreciation on the de-capitalized assets on the written down value ('WDV') basis on the block of assets in terms of Section 43(6) (c) of the Act notwithstanding that some of the assets had been converted into stock-in-trade at nominal value. 3. As noted in the impugned order of the ITAT, the case of the Assessee is that there are certain fixed assets which were not capable of use for captive consumption and had to be discarded from the block of assets for conversion into stock-in-trade. As and when the de-capitalized assets, i.e., stock-in-trade are sold, the profit is accou....

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....finds no reason to disagree with the reasoning or conclusion of the ITAT in this regard and therefore is not inclined to frame question on this issue. 7. The second question arises in the specific context of 'revenue recognition' in respect of certain types of sales made by the Assessee of its products. In the notes to the financial statements appended to the balance sheet for the relevant previous year under the heading 'summary of significant accounting policies', the Assessee has sought to explain 'revenue recognition' as under: "Revenue from sale of goods is recognized as goods are despatched to the customers and upon endorsement of title to the goods. Revenue from sale of goods with a conditional cla....