AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (6) TMI 1396
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....lowing Selling and Distribution Expenses of Rs.7,34,850/-. 2. Brief facts relevant for the purpose of this Appeal are that the Appellant- Company is engaged in the business of manufacturing and selling pharmaceutical formulation such as capsules, tablets, ointments, liquid oral, injections etc. During the financial year 2012-13 relevant to assessment year 2013-14 the Assessee-Company fabricated and installed Air Pollution Control Equipment and Water Pollution Control Equipment at the total cost of Rs.60,82,274/-. These equipments were put to use after 30th September 2012. On Air Pollution Control equipment and Water Pollution Control equipments, depreciation is allowable at 100% as per I.T. Rules, New Appendix-1 effective from A.Y.2006-07....
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....ssee was rightly entitled to 100% depreciation of Rs.30,41,138/- i.e. 50% of total cost of Rs.60,82,275/- as the same was put to use after 30th Sept. It was also pointed out that the Assessee had claimed balance 50% of depreciation amounting to Rs.30,41,138/- in subsequent year i.e. A.Y.2014-15 and the same Assessing Officer allowed the depreciation as claimed. 2.2 Learned CIT(A) in his order stated that the Assessee has failed to rebut the fact stated by A.O. that these machines are not mentioned in the prescribed list of specified items. He also held that principle of res-judicata is not applicable to Income Tax Act and the Assessee has failed to categorically mention that it was the same item during the year as was in A.Y.2014-15. So ho....
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.... as per valuation report. While analyzing the entry we have to see the description of plant as a whole and not the description of various items - small and big which go to constitute the plant. We have no doubt that the plant installed was the plant of air and water pollution control which was admittedly put to use after 30th September. Further on the very same plant and machinery the very same A.O. has allowed balance depreciation of 50% in A.Y.2014-15 and that order is final. In view of this fact, we see no reason for lower authorities to disallow depreciation of Rs.30,41,138/- for A.Y.2013-14 the year in question. Here there is no question of arguing that principle of resjudicata is not applicable and hence the finding of A.Y.2014-15 can....
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.... considered the expenses at higher side. He therefore disallowed selling and distribution expenses to the extent of 2.95% i.e. Rs.21,72,102/-. However since he had already disallowed Rs.8,21,100/- separately out of printed & promotional material, he disallowed Rs.13,51,002/- (Rs.21,72,102/- - Rs.8,21,100/-). 3.2 Against the said disallowance of Rs.13,51,002/- the Assessee objected to the said disallowance in an appeal filed by Assessee before ld. CIT(A). Assessee submitted before ld. CIT(A) that there is no dispute that these are business expenses and have been allowed by the department in earlier and later year even though the same was at higher figures. It was pointed out that the books of accounts are duly audited and no defect has been....
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....relied on the order of A.O. and ld. CIT(A) and relied on the decision of Goodlas Nerolac Paints Ltd. Vs. CIT reported in (1982) 137 ITR P.58 (Bom.) which says that the Assessee has to prove that the expenses are wholly and exclusively laid out for business purposes and submitted that the said addition be confirmed. 3.4 We have heard the rival submission. At the outset it needs to be pointed out that there is no dispute that the relevant expenses are for business purpose and they have been allowed year after year. Ld CIT(A) has also held that there is no doubt that the promotion, marketing and advertisement expense are part of business expenses. Neither the A.O. nor the ld. CIT(A) has doubted the allowability of expenses. The decision cited....