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Issues involved: Appeal against order of CIT(A) regarding disallowance of depreciation on leased assets for A.Y. 2006-07.
Issue 1: Disallowance of depreciation on leased assets The appellant raised ground no. 4 in its appeal, challenging the confirmation of depreciation amounting to Rs. 7,93,490 on assets leased to Western Railways. The Hon'ble Bench set aside the issue to the AO for fresh consideration after referring to the terms of the lease agreement, the AO's explanation, and a Special Bench decision. The appellant pointed out that in earlier years, the Hon'ble Bench had allowed depreciation on the same leased assets, considering them as operating leases based on the Supreme Court decision in the case of ABB Ltd. The appellant argued that sending back the issue for re-adjudication created confusion and was unjustifiable as the leased assets were already part of the block of assets. The Hon'ble Bench allowed the appellant's miscellaneous application, directing the case to be fixed before the regular Bench. Conclusion: The appellant's miscellaneous application was allowed, and the case was directed to be fixed before the regular Bench.
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