2011 (7) TMI 1219 - AT - Income Tax

Summary

Issues involved: Appeal by Revenue against deletion of additional depreciation u/s.32(1)(iia) on machinery used for embroidery work.

The judgment pertains to an appeal by the Revenue challenging the deletion of additional depreciation claimed u/s.32(1)(iia) on machinery used for embroidery work. The Learned CIT(Appeals) had allowed the additional depreciation based on previous decisions of the ITAT Ahmedabad bench in similar cases. The Revenue contended that the embroidery work did not qualify as manufacturing activity for claiming additional depreciation.

The main issue in this case was the allowability of additional depreciation on embroidery machinery u/s.32(1)(iia) of the Income Tax Act. The Learned CIT(Appeals) relied on precedents from the ITAT Ahmedabad bench to support the allowance of additional depreciation for embroidery work, considering it as an activity of manufacturing. The decisions cited were ITO vs. M/s.Aswani Industries, Surat and ITO vs. Haripriya Processors Pvt.Ltd. The ITAT upheld the CIT(A)'s decision, dismissing the Revenue's appeal.

In conclusion, the ITAT Ahmedabad upheld the decision of the CIT(A) to allow additional depreciation on machinery used for embroidery work, considering it as a manufacturing activity. The appeal by the Revenue was dismissed, and the order was pronounced on 22nd July 2011.