The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has allowed higher depreciation to office electronic fittings on failure to distinguish between the electric fitting installed in factory and office premises.
The electric fittings were installed in the office premises as well as in the factory premises of assessee, Super Alloy Castings P. Ltd. The depreciation had been claimed @10% on the fittings installed in the office premises whereas the depreciation on Factory Genset and Electrical Panels of certain machines installed for factory premises were charged at 15% as eligible to the assessee.
The Assessing Officer as well as the Commissioner of Income Tax Appeals (CIT(A)) had failed to appreciate the distinction between the electric fittings installed in the factory premises vis-à-vis office premises and allowed depreciation at 10% only on the electric fittings installed on factory premises too.
It was further pointed out that for the Assessment Year 2014-15 on the same matter, the Assessing Officer issued notice under Section 148 of the Income Tax Act on account of excess depreciation on such electric fittings. However, while framing the assessment under Section 143(3) read with Section 147 of the Income Tax Act vide order dated 30.03.2012, the Assessing Officer found merit in the claim of the assessee and no additions were made on the identical point.
Rajnish Behari, on behalf of the assessee submitted that the CIT Appeals was not justified in confirming the disallowance on account of depreciation on electrical fittings and no such disallowance had been made in past assessments under Section 143(3) of the Income Tax.
Anuj Garg, appeared on behalf of the revenue.
The two-member Bench of Saktijit Dey (Vice President) and Pradip Kumar Kedia (Accountant Member) allowed the appeal filed by the assessee aside on this issue and directing the assessing officer to reverse the disallowance holding that the Assessing Officer himself had accepted the higher claim of 15% in Assessment Year 2014-15 and palpable merit had been found in the plea of the assessee towards correctness of higher depreciation claimed on electric fittings installed at the factory premises.
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