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The judgment involves the consideration of allowance of depreciation while estimating profit for assessment years 2004-05, 2005-06, 2006-07, 2007-08, and 2009-10. Depreciation Allowance Issue: The ld.representative for the assessee argued that depreciation should be allowed while estimating profit from cinema theatre, citing a circular by CBDT. The Tribunal had previously directed the assessing officer to reconsider depreciation based on material provided by the assessee. The ld.DR contended that all expenses, including depreciation, are deemed allowed when profit is estimated. The Tribunal noted that depreciation should be worked out separately and deducted from the estimated net profit, as per the CBDT circular. The matter was remitted to the assessing officer to compute depreciation based on furnished material, similar to a previous case. The Tribunal held that the earlier order regarding depreciation allowance for a different assessment year was equally applicable to the current assessment years. Consequently, the orders of the lower authorities were set aside, and the issue was remitted back to the assessing officer for fresh consideration, with a directive to compute depreciation in accordance with the law after providing a reasonable opportunity for the assessee to be heard. Result: All appeals of the taxpayer were allowed for statistical purposes.
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