TaxTMI 
TaxTMI 
TaxTMI 
2024 (10) TMI 711
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....Income Tax Appellate Tribunal, Ahmedabad "C" Bench in ITA No. 52/Ahd/2021 for Assessement Year 2015-2016. "(i) Whether on the facts and circumstances of the case and in law, the Appellate Tribunal has erred in allowing additional depreciation of Rs.32,65,56,916 u/s. 32 (1) (iia) of the Act without appreciating that assessee is not engaged in manufacture or production of any article or thing? (ii) Whether the amendment by way of insertion of third proviso to section 32 (1) (ii) by Finance Act, 2015 w.e.f. 01.04.2016 providing for allowance of balance additional depreciation in the succeeding year is retrospective in nature? (iii) Whether on the facts and circumstances of the case and in law, the Appellate Tribunal has erred in deleti....
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....ing Officer also made an addition of Rs. 2,58,50,676/- on account of alleged incorrect claim of depreciation and additional depreciation on various electrical items by not treating them as plant and machinery. 6. Being aggrieved, the assessee preferred appeal before the Commissioner (Appeals) who confirmed the dis-allowance made by the Assessing Officer not only confirmed the dis-allowance made by the Assessing Officer on additional depreciation but also enhanced the same on ground that the additional depreciation of Rs. 32,65,56,918/- is not allowable since, the assessee is not engaged in the business of manufacturing and production of an article or a thing. The CIT (Appeals) also confirmed the dis-allowance on the electrical items namely....
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....k is procured from various farmers and villagers. Thereafter the said milk processed under various machines and manufactured into various milk products. Thus the activity carried out by the assessee is not only processing of milk but involved detailed technical machineries and manufacturing different kind of milk products." 8. The Tribunal also followed the decision of this Court in Tax Appeal No.760 of 2013 dated 23.01.2014 wherein it was held as under: "14. Thus, the whole process of conversion of the raw material when leads to production of new article and when its character, use and nature also indicate complete transformation bringing into existence the new product altogether. The assessee has rightly been allowed the benefit of ad....
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....Question No.2 in case of The Principal Commissioner of Income-Tax vs. Kalpataru Power Transmission Ltd. in Tax Appeal No.791 of 2019 dated 06.01.2020 wherein it is held as under: "6. In view of the above facts, it would be germane to refer relevant provisions of Section 32 (1) of the Act which reads as under:- "32. (1) In respect of depreciation of- (i) buildings, machinery, plant or furniture, being tangible assets; (ii) know-how, patents, copyrights, trade marks, licences, franchises or any other business or commercial rights of similar nature, being intangible assets acquired on or after the 1st day of April, 1998, owned, wholly or partly, by the assessee and used for the purposes of the business or profession, the following d....
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....e : Provided also that where an asset referred to in clause (iia)or the first proviso to clause (iia), as the case may be, is acquired by the assessee during the previous year and is put to use for the purposes of business for a period of less than one hundred and eighty days in that previous year, and the deduction under this sub-section in respect of such asset is restricted to fifty per cent of the amount calculated at the percentage prescribed for an asset under clause (iia) for that previous year, then, the deduction for the balance fifty per cent of the amount calculated at the percentage prescribed for such asset under clause (iia) shall be allowed under this sub-section in the immediately succeeding previous year in respect of su....
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....additional depreciation is made f the Assessment Year 2011-12." 11. Thus, both the Question Nos. 1 and 2 being factual and covered effectively cannot be said to be substantial question of law arising out of the impugned order passed by the Tribunal. 12. So far as Question No.3 is concerned, the Tribunal has observed that the Assessing Officer and CIT (Appeals) disallowed the depreciation on electrical items which are forming part of plant and machinery, in this connection the Tribunal has arrived the finding of facts as under: "16. We have given our thoughtful consideration and perused the materials available on record. It is seen from the certificate issued by the Senior General Manager (Project) of Engineering Department of the asses....