The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench allowed the 60% depreciation on xerox machines to the assessee.
The assessee, Dimple Vishal Agrawal has filed her return of income declaring total income at Rs.8,80,560. The case of the assessee was selected for scrutiny assessment and notice under section 143(2) was issued and served upon the assessee.
On scrutiny of the accounts, it revealed to the AO that the assessee has claimed depreciation at the rate of 60% whereas in his opinion depreciation at the rate of 15% is available on these printers, xerox-machine, etc.
In this way, the AO has disallowed a sum of Rs.7,40,297. However, on appeal, the CIT(A) confirmed the disallowance on the Xerox machine i.e. last item in the table. The assessee has claimed depreciation at Rs.1,89,000. The CIT(A) concurred with the AO on this item of an asset for the purpose of admissibility of depreciation.
The sole grievance of the assessee is that the CIT(A) has erred in confirming the allowance depreciation at the rate of 15% as against 60% claimed by the assessee on the xerox machine.
The coram consisting of Rajpal Yadav held the assessee is entitled to depreciation at the rate of 60% of this alleged xerox machine on the grounds that the CIT(A) failed to comprehend the true nature of this asset. It has been treated as a photo-state machine without going through the literature of the machine supplied by the manufacturer. According to the manual, it is a multi-functional printer. Its feature to make a photo-state of a paper is an added activity.
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