TaxTMI 
TaxTMI 
2018 (5) TMI 1168
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....e Tribunal and concern the same assessee. Tax Appeal No.272 of 2018 pertains to A.Y. 2006-07, Tax Appeal No.275 of 2018 pertains to A.Y. 2010-11 and Tax Appeal No.276 of 2018 pertains to A.Y. 2009-10. 3. In the amended appeals, the Revenue has proposed the following questions for our consideration; Tax Appeal No.272/2018: [A] Whether the Appellate Tribunal is right in law and on facts in allowing 100% depreciation as claimed by the assessee despite the fact that the plant and machinery were leased w.e.f. 01.10.2005 and the income was assessed under income from other sources ? [B] Whether the Appellate Tribunal was justified in allowing the claim of additional depreciation u/s.32(1)(iia) solely on the ground tha....
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....7, the assessee had claimed normal depreciation on installation and use of such machinery. Since the machinery was newly purchased, the assessee also claimed additional depreciation u/s.32(1)(iia) of the Income Tax Act, 1961. The Assessing Officer, however, while framing scrutiny assessment, was of the opinion that there was no proof that the machinery was put to use before 30.09.2005, i.e. for more than 180 days during a year. He, therefore, restricted the assessee's claim of normal depreciation to 50%. In relation to the assessee's claim of additional depreciation, he was of the opinion that in addition to the machinery not having been put to use before 30.09.2005, the same was, in any case, leased out from 01.10.2005, which included the ....
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....preciation in the later years, which the Revenue objects to. Section 32 of the Act, as we know, pertains to depreciation. In terms of subsection (1) thereof, in respect of building, plant, machinery or furniture, being tangible assets, owned wholly or partly by the assessee and used for the purpose of business or profession, depreciation is available at the prescribed rate. On the other hand, PartF of ChapterIV (Computation of total income) pertains to "Income from other sources". Subsection (1) of Section 56, which is in PartF, provides that income of every kind, which is not to be excluded from the total income, shall be chargeable to incometax under the head "Income from other sources", if it is not chargeable to tax under any of the hea....
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....ormal depreciation, had claimed additional depreciation in terms of subclause (iia) of subsection (1) of Section 32. This is on the premise that the assessee had purchased new machinery and plant for the purpose of its manufacturing activity. Factually, it has been concluded by the CIT(A) and the Tribunal that the assessee did purchase such plant and machinery in the month of July 2005 and put it to use for its own manufacturing activity before letting out on hire to Arvind Mills Ltd. on 01.10.2005. In this context, we have already noted the normal depreciation provided in subsection (1) of Section 32 of the Act. The said provision envisages grant of additional depreciation at the prescribed rate in the following terms; "(iia) in t....