TaxTMI 
TaxTMI 
2013 (7) TMI 1132
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....eclaring total loss of Rs. 64,93,600/- which was accepted by the Assessing Officer in the order passed u/s.143(3) on 16-11-2005. Subsequently, a notice u/s.148 of the Income Tax Act was issued and served on the assessee on 31-03-2010. During the course of assessment proceedings the Assessing Officer noted that as per the provisions of the Income Tax Act no depreciation was to be allowed on building used for the business purposes unless the building in question was complete in all respect and fully used for the purpose for which it was envisaged. He observed that the assessee company during the A.Y. 2003-04 has claimed depreciation of Rs. 23,00,596/- on Hospital building which was incomplete. 2.1  ....
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.... the audited accounts it is seen that the company's turnover for the year jumped to Rs. 1,27,28,062/- form Rs. 26,88,092/- in the preceding year. This could not have been achieved without use of proper building and equipment. The assessee in the assessment proceedings has furnished elaborate particulars with regard to the building also the facilities available in the hospital giving particulars of use of various part of building The assessee was facing a liquidity crunch and was not able to complete the access to the building and finishing work of the entrance. Hence, the completion certificate could not be obtained at the relevant time. However the hospital building otherwise was complete in all respects and fully utilized for....
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....section 147 We request :you to kindly drop the reassessment proceedings and accept the income returned and assessed U/s 143(3)" 2.2 However, the Assessing Officer was not satisfied with the explanation given by the assessee since the hospital building is not fully completed and since the completion certificate has not been obtained from the local authority. The Assessing Officer accordingly disallowed depreciation of Rs. 23,00,596/- . 3. In appeal the Ld.CIT(A) allowed the claim of the assessee by holding as under : "4.3 I have considered the submission made by the appellant and also perused material on record, in order to avail depreciation one should satisfy the followin....
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....neficial ownership is alone relevant and that such decision should be treated as applicable in all tax matters by recognizing the beneficial owner for liability as well as any deduction. It took the view that, such view is clear, equitable and consistent with justice and such a view cannot be lightly dismissed, while the Finance Act, 1987 recognised beneficial ownership for computation of property 'income for income-tax, capital gains tax, wealth-tax and gift-tax, the need for clarification in respect of depreciation allowance was overlooked. The controversy got settled in respect of right to deprecia....
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....ppreciate that no completion certificate had been issued by the local municipal authority to the hospital building which would certify that the said building was not complete in all respects so as to put to use for the purpose of business. 3) The learned Commissioner of Income-tax (Appeals) grossly erred in failing to appreciate that except for the contention regarding quantum jump in the turnover, no substantive evidence was produced by the assessee to prove that the entire newly constructed building was actually put to use for the purpose of business. 4) For these and such other grounds as may be urged at the time of the hearing, the order of the learned Commissioner of Income-tax (Appeals) may be vacated and that of the....