2012 (4) TMI 665 - AT - Income Tax

Summary

Issues involved: Appeal against CIT(A) order for AY 2007-08. Grounds include disallowance of traveling expenses and excess depreciation on computer peripherals.

Disallowance of Traveling Expenses:
The Revenue challenged the deletion of Rs. 1,099,583 disallowed for chartering aircraft. The Revenue argued that the burden is on the assessee to prove the expenditure was for business purposes. The CIT(A) allowed the deduction based on the bill from International Air Charters and TDS certificate. The assessee claimed the aircraft was hired for inspecting press machines at various locations in a short time. However, no evidence was produced to support this claim. The Tribunal found the Assessing Officer did not provide the assessee an opportunity to present evidence. The matter was remanded to the Assessing Officer for the assessee to provide necessary evidence.

Excess Depreciation on Computer Peripherals:
The Revenue contested the deletion of Rs. 55,802 excess depreciation claimed on computer peripherals. The Assessing Officer allowed 15% depreciation instead of the 60% claimed by the assessee. The CIT(A) directed 60% depreciation based on a Special Bench decision classifying necessary computer accessories for operation as part of the computer. The Tribunal upheld the CIT(A)'s decision, stating that accessories and peripherals integral to the computer are entitled to 60% depreciation. The appeal was partly allowed for statistical purposes.

Decision pronounced on 13th April, 2012 by SHRI G.D.AGRAWAL, VICE PRESIDENT AND SHRI I.P.BANSAL, JUDICIAL MEMBER.