2025 (10) TMI 533

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....d grounds of appeal, has challenged the allowability of depreciation @ 100% on shuttering material, etc. instead of 15% allowed by the Ld. Assessing Officer ('AO'). 3. The relevant facts giving rise to this appeal are that the assessee, an infrastructure company, filed its Income Tax Return ('ITR') of the relevant year on 30.09.2015 declaring income of Rs. 4,91,71,350/-. The case was picked up for scrutiny, and the consequential original assessment was completed at Rs. 4,93,21,350/- under section 143(3) of the Income Tax Act, 1961 ('the Act'). Later on, the case was reopened on the reasoning that the shuttering charges debited to the Profit & Loss Account was abnormally very high at 7% of the turnover as against 0.43% in the preceding ye....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ly Temporary erections such as wooden structures (i.e. shuttering etc.) depreciation is allowable @ 100%. In view of this provision the AO is directed to allow depreciation of 100% as the expenditure has been capitalized. Accordingly, the entire expense of Rs. 3,03,08,260/- will be allowed. These grounds of appeal are 'Allowed'." 5. Before us, the Ld. Sr. DR argued vehemently and defended the order of Ld. AO. 6. On the other hand, none attended for the respondent-assessee. 7. We have heard Sr. DR and have perused the material available on record. The sole issue involved in this appeal is that where the depreciation on the shuttering material is allowable @ 100% or 15%. We have gone through the order of the Hon'ble Telangana & A....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ls therein to be seen under the proviso to section 32(1). The "centering and shuttering" material is a homogenous qualitative material, though it is divisible. In such a case, the assessee could not claim the higher rate of depreciation by application of the proviso to such homogenous material. (iii) That where the actual cost of any "plant" does not exceed Rs. 5,000, the assessee is entitled to claim 100 per cent. depreciation. Merely because the cost of every single item is less than Rs. 5,000, every single item used for shuttering cannot be treated as plant." 8. We are of the considered view that this case is squarely covered by the decision of the Hon'ble Telangana & Andhra Pradesh High Court (Full Bench) in the case of S. V....