2020 (9) TMI 29

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.... could be preferred. But the accountant failed to do so, resulting delay in filing the appeal for 104 days. The ld. AR before us has filed the affidavit of the accountant which is available on record. 2.1 In view of the above, the learned AR for the assessee claimed that the delay in filing the appeal was unavoidable and beyond the control of the assessee. Therefore, he prayed before us to condone the delay and adjudicate the issues raised therein on merit. 3. On the other hand, the learned DR before us submitted that there is inordinate delay in filing the appeal for 104 days. Accordingly, he opposed to condone the delay in filing the appeal. 4. We have heard the rival contentions of both the parties and perused the materials available on record. From the preceding discussion we find that the controversy arises for our adjudication whether there exist reasonable and sufficient cause for condoning the delay in filing the appeal before ITAT in the aforesaid facts and circumstances. There is no hard and fast rule which can be laid down for condoning the delay in filing the appeal. As such the discretion for condoning the delay can be exercised depending upon the facts of eac....

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....justice deserves to be preferred rather than deciding the matter on the basis of technical defect. We also note that there is no allegation from the Revenue that the appeal was not filed within the time by the assessee deliberately. Therefore, we are inclined to prefer substantial justice rather than technicality in deciding the issue. Hence we condone the delay and proceed to decide the issue on merit. 5. The assessee has raised the following grounds of appeal: 1. The learned CIT(A) has erred both in law and on the facts of the case in confirming the disallowance ofinterest expenses of Rs. 3,11,0107-u/s.36(l)(iii)of the Act. 2. The learned CIT(A) has erred both in law and on the facts of the case in confirming the disallowance u/s.HA r.w.r. 8D to the extent of Rs. 23,143/-. 3. The learned CIT(A) has erred both in law and on the facts of the case in confirming the additionof interest on IT Refund of Rs. 53,994/-. 4. The learned CIT(A) has erred both in law and on the facts of the case in confirming the disallowance of depreciation on machinery of Rs. 6,58,057/-. 5. The learned CIT(A) has erred both in law and on the facts of the case ....

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....ome of the assessee. 9. Aggrieved assessee preferred an appeal to the learned CIT (A) who confirmed the order of the AO. Being aggrieved by the order of the learned CIT (A) the assessee is in appeal before us. 10. The learned AR before us submitted that an identical issue was raised by the AO in the immediate preceding assessment year with respect to the very same assets and finally made the disallowance of interest expenses. The matter was travelled up to ITAT which deleted the disallowance of interest expenses in ITA No. 928 /AHD /2016 vide order dated 20th January 2020 by observing that the acquisition of the assets in dispute does not amount to the extension of the existing business. Thus, there was no question of making the disallowance of interest expenses incurred on the money borrowed which was utilized in the acquisition of the fixed asset and the same was put to use as on 30-9-2011. 11. On the other hand the learned DR vehemently supported the order of the authorities below. 12. We have heard the rival contentions of both the parties and perused the materials available on record. Admittedly, the amount was borrowed dated 29th December 2010 in the immediate ....

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....8.2. In this regard, we note that the value of the machine acquired by the assessee during the year is negligible to the total value of the plant and machineries shown by the assessee in its balance-sheet as on 31 March 2011. Such, small addition in the plant and machinery cannot amount to the extension of the existing business. As there is no detail available before us suggesting that there was some increase in the production/sales etc, we are not inclined to treat the interest expense on the acquisition of such machinery out of the borrowed fund as extension of the existing business. Accordingly we hold that as there was no extension of the existing business, therefore the amount of interest expenses incurred by the assessee on the borrowed money utilized for the acquisition of the machineries is eligible for deduction as revenue expense. Hence the ground of Appeal of the assessee is allowed." 12.1 The issue involved in the case on hand is identical to the issue as discussed above. Therefore, respectfully following the same, we set aside the finding of the learned CIT (A) and direct the AO to delete the addition made by him. 12.2 Before parting, we also note that the assess....

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....uired by the assessee during the previous year and is put to use for the purposes of business or profession for a period of less than one hundred and eighty days in that previous year, the deduction under this sub-section in respect of such asset shall be restricted to fifty per cent of the amount calculated at the percentage prescribed for an asset under clause (i) or clause (ii) or clause (iia), as the case may be : 18.1 A perusal of the above provision reveals that the asset which has been used for a period less than 180 days in the previous year is eligible for the depreciation at the rate of 50% of the amount of depreciation calculated at the prescribed percentage. In other words, assuming the asset is eligible for the depreciation at the rate of 15% but assessee shall claim depreciation only at the rate of 7.5% on the value of such assets. 18.2 However, on calculation of the number of days considering the date 4th October as the date put to use, the total number of days works out to 180 days which implies that the condition as provided in the 2nd proviso to section 32 of the Act has been complied with. The learned AR for the assessee at the time of hearing has worked ou....

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....submitted that the vehicles were purchased on 27th September 2011 as evident from the invoices issued by the party. Similarly, the insurance was taken for the period beginning from 27th September 2011 to 26th September 2012. 22.1 The assessee also contended that the registration date as mentioned in the records of the RTO is 28th of September 2011 but the certificate was issued dated 12th October 2011 which can be verified from the records. Accordingly the assessee claimed that it is entitled for the depreciation at the rate of 15% on the value of such vehicles. 23. However the learned CIT (A) rejected the contention of the assessee by observing as under: 6.4. On the other side the appellant has submitted that the RTO registration date is on 28.9.2011 as per RTO record. The contention of the appellant is found incorrect for the reason that the fee has been collected for the registration, HPA, CR Ten A on 28.9.2011 by the RTO but the registration of the vehicle has been made only on 12.10.2011 as evident from the Registration Certificate. The certificate was also valid from 12.10.2011 to 11.10.2026 only. Thus it was clear from the copy of the certificate produced that....