2021 (11) TMI 540

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....5 holding that the Appellant-Company would not be allowed to claim additional depreciation allowance adjustment towards the actual cost of plant and machinery which might get increased due to the exchange rate fluctuation. 2. While admitting the present appeal on 21st February 2005, the following substantial question of law was framed by this Court for consideration: "Whether in the facts and circumstances of the case, Rs. 2,54,875/- claimed towards depreciation by the Assessee is allowable under Section 43A of the Income Tax Act, 1961?" 3. The brief facts are that the Appellant-Assessee filed its return of income for the AY 1994-95. Pursuant to a notice issued under Sections 142 (1) and 143 (2) of the Income Tax Act, 1961 (A....

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....e and this ground of the department is allowed. In the result, the appeal is partly allowed and the cross objection is dismissed as infructuous." 6. This Court has heard the submissions of Mr. Sunil Mishra, learned counsel appearing for the Appellant-Assessee and Mr. R. Chimanka, learned Senior Standing Counsel appearing for the Department. 7. The impugned order of the ITAT fails to discuss any of the decisions referred to by the CIT (A) in its order. Its conclusion that the actual cost in such cases can be quantified "at the time of actual payment and not on the accrual basis" entirely misses the central issue which is the effect of increase in the cost on account of exchange rate fluctuation. 8. In fact this issue was implicitly ....