2020 (2) TMI 1102

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....unal, Chandigarh Bench (for short, 'the Tribunal') partly allowing the appeal of the revenue. Following substantial questions of law have been claimed in the appeal: "(a) Whether in the facts and circumstances of the case, the orders Annexures P-1 and P-3 are legally sustainable? (b) Whether in the facts and circumstances of the case, the assessee is entitled to charge arrears of depreciation due to a change in the method of providing depreciation for earlier years to the profit and loss account of the current year for the purpose of computing book profit U/s 115-J of the Act? (c) Whether in the facts and circumstances of the case, "Book Profit" for purposes of Section 115-J of I.T. Act has to be calculate....

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....ome. The case was taken up in scrutiny. The Assessing Officer vide order dated 28.10.1991 disallowed the depreciation claimed by the appellant as per the provisions of the 1961 Act and Income Tax Rules, 1962 (for short, 'the Rules'). The Appellate Authority partly allowed the appeal and directed the Assessing Officer to compute profit under Section 115J of the 1961 Act by allowing depreciation as provided under the 1961 Act and the Rules. It was further held that deduction on account of unabsorbed depreciation be also allowed. Feeling aggrieved, the revenue preferred the appeal. The Tribunal vide order dated 22.6.2000 partly allowed the appeal of the revenue and held that depreciation as provided under the Companies Act, 1956 (for s....

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....ts profit and loss account which according to the Revenue is not in accordance with Part II and III of Schedule VI to the Companies Act, 1956 (the 'Companies Act'). Hence, the assessing officer while considering the case of the assessee company under Section 115-J of the IT Act recomputed the said profit and loss account of the company so as to exclude the provisions made for arrears of depreciation. The said action of the assessing officer in questioning the correctness of the accounts maintained by the company was challenged by the company before the Income Tax Appellate Tribunal ('the tribunal') which among other things held that the assessing officer has no authority to reopen the accounts of a company which is certified....