TaxTMI 
TaxTMI 
2016 (9) TMI 1329
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.... 1961, and others are common, therefore, these appeals are heard together and are being decided by this common order, for the sake of convenience. 2. The assessee has raised two effective grounds of appeal. The first ground is in respect of challenging the jurisdiction of the AO u/s 147 read with section 148 of the Act and Ground no.2 relates to disallowance of depreciation. 3. We shall first take up the Ground no.1 on merits. (AY-2005-06) 3.1 The brief facts of the case are that the assessee filed its return of income on 18.10.2005 declaring total income at Rs. 22,43,950/- which was processed under section 143(1) of the Act on 24.2.2006. Thereafter, the case of the assessee was reopened after recording the reasons and obtaining the appr....
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....ee and made submissions vide letter dated 24.8.2011 and 8.11.2011. The ld. AR submitted before the AO that the insurance claim receivable from the Insurance Company was not certain and therefore the same was not taken into account while calculating the depreciation. The ld.AR submitted that Rs. 1 crore was received on 15.9.2005 and Rs. 1,49,40,705/- was received on 13.4.2006. The said claim was received against the loss of stocks as well as damages/ destruction of the fixed assets. The details as to break-up of claim was not available with the assessee during the year and therefore the said amount could not be deducted from the block of assets in the assessment year 2005-06. Final report with bifurcation from the Insurance Company was recei....
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.... i. in respect of any previous year relevant to the assessment year commencing on the 1 st day of April, 1988, the aggregate of the written down values of all the assets falling within that block of assets at the beginning of the previous year and adjusted- B. by the reduction of the moneys payable in respect of any asset falling within that block, which is sold or discarded or demolished or destroyed during that previous year together with the amount of the scrap value, if any, so, however, that the amount of such reduction does not exceed the written down value as so increased." From this it can be seen that the moneys payable in respect of machinery discarded should be reduced from the WDV in the year destruction. In view of th....
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....ount of claim received from the fixed assets when it obtained the details from the Insurance Company, therefore, the addition as made by the AO and confirmed by the ld. CIT(A) on account of depreciation was bad in law and be deleted accordingly. 6. The ld. DR heavily relied on the orders of authorities below. 7. We have carefully considered the rival submissions and perused the material placed before us including the orders of authorities below. We find that in this case, the fire took place in the factory premises of the assessee on 10.12.2004 and the assessee filed claim in respect of loss of stocks and fixed assets with the insurance company which was not received in the assessment year 2005-06. The claim was received in the assessment....