TaxTMI 
TaxTMI 
2016 (7) TMI 30
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....eciation of Rs. 67,06,559/- against the profits and gains of subsequent years without any limit. (ii) Whether on the facts and in the circumstances of the case and in law the ld.CIT (Appeals) has erred in directing to allow the unabsorbed depreciation brought forward from A.Y. 2001-02 and earlier years against the income of Rs. 1,52,16,223/- determined in the order u/s 143(3)/154. (iii) The appellant craves its right to add, amend or alter any of the grounds on or before the hearing. 2. The only effective ground in this appeal is against directing the AO to allow carry forward of unabsorbed depreciation of Rs. 67,06,559/- against the Profits and Gains of subsequent years without any limit. The ld. D/R supported the order of the AO and su....
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....as amended by the Finance Act, 2001, w.e.f. A.Y. 2002-03. This question also arose in the case of General Motors India (P) Ltd. vs. DCIT (2012) 25 Taxmann.com 364 (Guj.) It has been held in this order as under :- " 35. Section 32(2) of the Act was amended by the Finance Act, 2001, and the provision so amended reads as under : "Where, in the assessment of the assessee, full effect cannot be given to any allowance under sub-section (1) in any previous year, owing to there being no profits or gains chargeable for that previous year, or owing to the profits or gains chargeable being less than the allowance, then, subject to the provisions of subsection (2) of sec tion 72 and sub-section (3) of section 73, the allowance or the part of the ....
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....enabling the industry to conserve sufficient funds to replace plant and machinery and accordingly the amendment dispenses with the restriction of eight years for carry forward and set off of unabsorbed depreciation. The amendment is applicable from the assessment year 2002-03 and subsequent years. This means that any unabsorbed depreciation available to an assessee on the 1st day of April, 2002 (the assessment year 2002-03), will be dealt with in accordance with the provisions of section 32(2) as amended by the Finance Act, 2001, and not by the provisions of section 32(2) as it stood before the said amendment. Had the intention of the Legislature been to allow the unabsorbed depreciation allowance worked out in the assessment year 1997-98 o....
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.... it can be said that, current depreciation is deductible in the first place from the income of the business to which it relates. If such depreciation amount is larger than the amount of the profits of that business, then such excess comes for absorption from the profits and gains from any other business or business, if any, carried on by the assessee. If a balance is left even thereafter, that becomes deductible from out of income from any source under any of the other heads of income during that year. In case there is a still balance left over, it is to be treated as unabsorbed depreciation and it is taken to the next succeeding year. Where there is current depreciation for such succeeding year the unabsorbed depreciation is added to the c....