2019 (11) TMI 133

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....hy CIT(A) was not justified in confirming the disallowance of depreciation and additional depreciation of Rs. 11,40,910/- as claimed on capital subsidy of Rs. 32,59,741/-, which is otherwise required to be deducted from the cost of fixed asset, by erroneously holding that the same has been actually received by the assessee company. 3. That on law, facts and circumstances of the case, the Worthy CIT(A) has erred in confirming calculation of the Book Profits under section 115JB of the Income Tax Act, 1961 by contradicting treatment of capital subsidy by not deducting the amount of capital subsidy from book profit calculation and treated as revenue receipt. Simultaneously, on the other hand, the said amount of capital subsidy has been....

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....in this regard, it is submitted that during the year in question, the assessee company has not received amount of subsidy which is shown in profit & loss account. It is shown in Subsidy receivable under the head "Other Loans & Advances" in the Balance Sheet for the year under assessment and credited in subsidy account in the profit & loss account but subsidy has not received in actual it is receivable. As subsidy has not received during the year so why tax has been paid on such amount. It is fictitious assets. While computing taxable income of the assessee company, such amount of subsidy has been deducted from the income of the company. As subsidy amount has not received so it is not to be reduced from cost of machinery. After receiving the....

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.... this amount from the actual cost of the fixed assets for the purposes of claiming the depreciation and additional depreciation. 9. Now the assessee is in appeal. 10. Ld. Counsel for the assessee reiterated the submissions made before the authorities below and further submitted that the subsidy was to be reduced from the fixed assets only when it was received. However, for the year under consideration an amount of Rs. 10,04,264/- was received and not the whole amount of subsidy of Rs. 32,59,741/-. It was further submitted that neither the A.O. nor the Ld. CIT(A) appreciated the facts in right perspective and wrongly worked out the additional depreciation which is available only in the year of purchase and not in subsequent years. 1....

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....11(5), Bangalore, copy of the said order was furnished which is placed on the record. 15. In her rival submissions the Ld. Sr. DR strongly supported the orders of the authorities below. 16. After considering the submissions of both the parties and material available on the record it is notice that this issue has been set aside by ITAT Mumbai 'J' Bench in the aforesaid referred to case and the relevant findings have been given in para 23 of the order dt. 13/01/2017 in the case of M/s JSW Steel Limited, Mumbai Vs. ACIT, Circle 11(5), Bangalore (supra) which read as under: 23. From the perusal of aforesaid decisions, at the outset, it may appear that on similar nature of issues there are divergent views of various benches of the....