2018 (1) TMI 246

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.... " Whether the Tribunal was legally justified in allowing the set off of unabsorbed depreciation of Rs. 6,03,67,470/- pertaining to A.Y. 1997-98 against the income of A.Y. 2007-08 which is beyond eight years immediately succeeding the year for which the depreciation allowance was first computed hence not allowable as per provisions of Section 32(2)? 3. Counsel for appellant has taken us more particular to Section 32(2) and contended that the provisions of the Act which was in force from 01.04.1997 which reads as under:- " (2) Where in the assessment of the assessee full effect cannot be given to any allowance under clause (ii) of sub-section (1) in any previous year owing to their being no profits or gains chargeable for that ....

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....mended provisions will become effective after the depreciation which is required to be claimed after 2002. Therefore, she contended that the Tribunal has seriously committed error. She has contended that the view taken by the Tribunal is required to be reversed. However, counsel for respondent relied upon CBDT Circular No.14 of 2001 which is as under:- " Modification of provisions relating to depreciation 30.1 Under the existing provisions of Section 32 of the Income Tax Act, carry forward and set off of unabsorbed depreciation is allowed for 8 assessment years. 30.2 With a view to enable the industry to conserve suficient funds to replcace plant and machinery, specially in an era where obsolenscence taken so o....