Relief to Vibracoustic India: ITAT allows Additional Depreciation Claim on Plant, Machinery [Read Order]

Income Tax Appellate Tribunal (ITAT), New Delhi bench consisting of Anil Chaturvedi, Accountant Member and Anubhav Sharma, Judicial Member granted relief to Vibracoustic India as it allows additional depreciation claim on plant and machinery.

Assessee, Vibracoustic India Pvt. Ltd is a company stated to be engaged in the business of manufacturing anti-vibration auto parts. Assessee electronically filed its return of income for A.Y. 2014-15 on 29.11.2014 declaring income at Rs.59,44,61,550/-. The case was selected for scrutiny and thereafter assessment was framed u/s 143(3) and 144C of the Act vide order dated 26.12.2017 and the total income was determined at Rs.59,91,92,361/-. Aggrieved by the order of AO, assessee carried the matter before CIT(A) who vide order dated 15.04.2019 in Appeal No.10502/17-18 dismissed the appeal of the assessee. Aggrieved by the order of CIT(A), assessee is now in appeal.

During the course of assessment proceedings, AO on perusal of the Profit and Loss account noticed that assessee had claimed additional depreciation of Rs.47,30,811/- u/s 32(1)(iia) of the Act.. Assessee inter alia submitted that the additional depreciation at 10% was on the plant and machinery and mould purchased between 2nd Oct 2012 to 31st March 2013 in F.Y. 2013-14. It was further submitted that since in that year, the assessee had put the assets at less than 180 days from the date of acquisition of the assets, assessee had claimed additional depreciation at 10% in 2013-14 and the balance 10% additional depreciation was claimed in A.Y. 2014- 15.

The submissions of the assessee were not found acceptable to AO. AO was of the view that the provision of Section 32(iia) does not provide any allowance for claim of additional depreciation in the next year in which the additions have been made and that the newly inserted provision for allowing carry forward of additional depreciation in next year were applicable w.e.f. 01.04.2016 and not applicable to A.Y. 2013-14 and therefore not applicable to the year under consideration. He accordingly denied the claim of additional depreciation of Rs.47,30,811/-.

The Tribunal held that “Considering the totality of the aforesaid facts, we are of the view that assessee is eligible for claiming additional depreciation u/s 32(1)(iia) of the Act and therefore the same should not have been denied by the AO.”

To Read the full text of the Order CLICK HERE

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