2014 (2) TMI 1366

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...., needs no adjudication. 2. Vide its Grounds 1 & 2, Revenue assails the deletion of an addition of Rs. 5,45,980/- made by the Assessing Officer for a claim of additional depreciation on plant & machinery. 3. Facts apropos are that assessee, a manufacturer of jute and paper related goods, had during the relevant previous year claimed additional depreciation on plant & machinery newly installed by it, which, inter alia, included certain electrical installation. Assessing Officer was of the opinion that additional depreciation could not be given on electrical installation. According to him only plant and machinery was eligible for such additional depreciation. The disallowance came to Rs. 5,45,980/-. 4. In its appeal before ld. CIT(Ap....

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....n shall be allowed in respect of - (A) Any machinery or plant which, before its installation by the assessee, was used either within or outside India by any other person; or (B) Any machinery or plant installed in any office premises or any residential accommodation, including accommodation in the nature of a guest-house; or (C) Any office appliances or road transport vehicles; or (D) Any machinery or plant, the whole of the actual cost of which is allowed as a deduction (whether by way of depreciation or otherwise) in computing the income chargeable under the head "profits and gains of business or profession" of any one previous year". There is no dispute that assessee was engaged in manufacture of ju....

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....is no dispute that the payments were affected by the assessee before the due date of filing the return. Ground No. 3, therefore, stands dismissed. 10. Vide it's ground no. 4, grievance of the revenue is that interest of Rs. 19,63,017/- added by the Assessing Officer was deleted by ld. CIT(Appeals). 11. Facts apropos are that assessee had given a sum of Rs. 2.91 crores to one of its subsidiary company called Kamarthatty Power Ltd. Assessing Officer required the assessee to explain the source of loans given. Assessee thereupon submitted that the loans given to the subsidiary company came to Rs. 1,27,68,000/- as on 31.03.2007, which increased to Rs. 2,91,26,483/- by the end of the relevant previous year. Additional loan Rs. 1,63,58,48....

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....ion of the Hon'ble Apex Court in the case of Madhab Prasad Jatia -vs.- CIT [118 ITR 200]. 14. Ld. CIT(Appeals) was appreciative of these contentions. According to him, assessee had sufficient interest-free fund available with it and Assessing Officer could not establish the nexus between borrowed fund and the amount given as advance to the subsidiary. He, therefore, deleted the addition made. 15. Now before us, ld. DR strongly assailing the order of ld. CIT(Appeals) submitted that the money was given out of assessee's cash credit account with Allahabad Bank. Each time the cheque was cleared, the dues to the Bank increased. Therefore, according to him, one to one nexus was established. Assessing Officer was, therefore, justified in con....