2017 (1) TMI 723

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....ight in law in upholding the order of the CIT (A) allowing the assessee's claim of investment allowance u/s.32A on the value of the plant and machinery leased out by the assessee ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in upholding the order of the CIT(A) directing the AO to re-compute the disallowance under Rule 6D of the I.T. Rules by taking into account all the tours made by the employees and not on the basis of individual tours ? 3. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in upholding the order of the CIT(A) directing to allow additional depreciation on the assets leased out by the assessee ? 4. Whether, on the facts and....

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..... Re Question 1 : 4 The Assessing Officer denied investment allowance to the Assessee on the ground that the assets leased were not actually used by the Assessee. The same question in the case of the Assessee, for another Assessment Year, was referred to this Court and by its judgment dated 28 February 2005 (in ITR No.390 of 1995 - CIT vs. Industrial Credit & Investment Corporation of India Ltd.) answered in the affirmative, relying on the Supreme Court decision in the case of CIT vs. Shaan Finance (P.) Ltd. (231 ITR 308). The Supreme Court had held in that case that where the business of the Assessee consists of hiring out machinery, or where the income derived by the assessee from the hiring of any machinery is business income, the asse....

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....Leasing Co. of India (supra). This view of the Tribunal was upheld by the Madras High Court in CIT vs. First Leasing Co. of India Ltd. (216 ITR 455). The Revenue had challenged the same before the Apex Court. In the Revenue's appeal from the order of the Madras High Court, its view was affirmed while hearing it along with Shaan Finance (P) Ltd. (supra). Therefore, the decision of Shaan Finance (P.) Ltd. (supra) is squarely applicable to the claim of additional deprecation. The question is, accordingly, answered in the affirmative, i.e. in favour of the Assessee and against the Revenue. Re Question 4 : 7 Here, again, the Assessing Officer denied the Assessee's claim on the ground that the assessee company itself had not worked in ex....