2016 (2) TMI 523

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.... question of law for our consideration : "Whether on the facts and in the circumstances of the case, the Tribunal was correct in holding that the respondent company would be entitled to depreciation on assets of the Haryana State Electricity Board, with whom the respondent company had a sale and lease back transaction that was both in form and content a financial lease." 3. The respondent assessee had claimed 100% depreciation on Energy Measuring Devices purchased from Haryana State Electricity Board (the HSEB). After purchase, the same was leased back to HSEB under Lease Agreement dated 29th September, 1995. During the course of the assessment proceedings, the Assessing Officer held that the Lease Agreement styled as purchase a....

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..... The Tribunal by the impugned order dismissed the Revenue's appeal. This by placing reliance upon the decisions of Apex Court in I.C.D.S. Ltd. Vs. Commissioner of Income Tax & Anr. (2013) 350 ITR 527 SC and of the Tribunal in Development Credit Bank Ltd. Vs. DCIT, (ITA No. 3006/M/01, 4892/M/03 and 3620/M/01). The impugned order also makes a reference to the decision of the Tribunal in West Coast Paper Mills Ltd.(Supra) to conclude that the claim of depreciation on the sale and lease back of assets is allowable. 6. Mr. Pinto, learned Counsel for the Revenue in support of the appeal submits that the decision of the Apex Court in ICDS Ltd. (Supra) would not apply to the facts of the present case as it proceeded on the ground that it wa....

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....empted to show that the decision of the Tribunal in Development Credit Bank Ltd. (Supra) is not applicable to the present facts. Besides, the entire case of the Revenue as made by the Assessing Officer is the basis of the Circular No.2 of 2001 issued by CBDT. However, in appeal, the CIT(A) has examined the transactions and found them to be genuine. In fact, the impugned order of the Tribunal also refers to its decision in West Coast Paper Mills Ltd.(Supra) which have been analyzed by the CIT(A) in his order and found to be identical to the facts of this case. In fact the order of the Tribunal in West Coast Paper Mills Ltd.(Supra) was challenged in appeal being Income Tax Appeal No.389 of 2008 filed by the Revenue in this Court. However, the....