TaxTMI 
TaxTMI 
2013 (6) TMI 945
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.... income of Rs. 'NIL'. The assessee has shown gross income of Rs. 6,86,06,524/- in the Income & Expenditure Account. It has claimed depreciation of Rs. 61,68,457/- towards application of income for charitable purposes. By relying on the decision of Hon'ble Apex Court in the case of Escorts Ltd. v. Union of India [1993] 199 ITR 43 has disallowed this claim of depreciation on the premise that it would amount to double deduction, which is not permissible under the Act. The ld. CIT(A) has followed suit and thus, dismissed assessee's first appeal. 2.1 While arguing on ground No. (1) of the appeal, which is in relation to disallowance of depreciation, it was argued that, in fact, this issue now stands covered in favour of the as....
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....Value (WDV) is 'NIL' and, therefore, there is no amount (value of asset on which depreciation can be claimed, and if allowed it would to a double deduction which is prohibited in law. The contentious issue seems to be very clear in that view of the matter. But, when this issue is deeply analyzed it is found that section 11(1) of the Act excludes certain income from the 'total income' of the previous year. These are mainly as under:- (i) Income derived from property. (ii) Income in the form of voluntary contributions made with a specific direction that they shall form part of the corpus of the trust or institution. The Trust for the sake of claiming benefit of section 11 has to fulfil certain conditions. ....
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....onsecutive years of the expenditure incurred on the acquisition of the asset. It was held thus:- "Where a capital asset used for scientific research related to the business of the assessee is also ipso facto an asset used for the purpose of the business, it is impossible to conceive of the Legislature having envisaged a doubt deduction in respect of the same expenditure, one by way of depreciation u/s 32 of the I.T. Act and other by way of allowance u/s 35(1)(iv) of a part of the capital expenditure on scientific research, even though the two heads of deduction do not completely overlap and there is some difference in the rationale of the two deductions...." It was further held that: "There is a fundamental, though unwr....
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.... (4) CIT v. Society of the Sister of St. Anne [1984] 146 ITR 28/ (5) CIT v. Raipur Pallotine Society [1989] 180 ITR 579/[1990] (6) CIT v. Shri Gujrati Sang (Regd.) [2011] 64 DTR 76 (MP). 2.5 It becomes apparent that we are not dealing with the taxability of income. We are considering the issue of application of 85% of the gross receipts of the year in terms of Explanation (2) appended to section 11(10(a) & (b) of the Act. While considering the income of the Trust the 'income' is not considered under any of the five heads prescribed in section 14 of the Act. Therefore, the provisions of section 145 cannot apply as it applies to sections 28 and 56 and not to sub-sections (11) and (12) of the Act. Under sectio....
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....as against Rs. 6,00,54,267/-, shown in the assessable income filed by the assessee. The ld. CIT(A) has also followed suit. 3.1 Before us, both parties have reiterated and have taken their original stand. It was argued by the ld. AR that the assessee has been regularly following the system of declaring interest when actually realized during the year as income. That yearly accrued interest on FDRs is calculated and is credited in the P&L account but while filing the return of income an adjustment of actual interest realized during the year is made and total taxable income is computed accordingly. It was stated that the assessee has been regularly following this very system of accounting of these receipts. In proof of the above statements, ....