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Issues involved:
The judgment involves the following issues: 1. Allowability of depreciation on capital assets when deduction for capital expenditure has already been allowed. 2. Justification of double deduction on depreciation in light of relevant legal precedents. 3. Restoration of issue to allow set off of brought forward unabsorbed depreciation and losses. 4. Direction to consider excess amount of income application for adjustment in the current year. 5. Allowance of payment to Haryana Agriculture Marketing Board as application of income for charitable purpose. Issue 1: Allowability of depreciation on capital assets: The Assessee, a Market Committee registered under Section 12AA of the Act, claimed depreciation and deduction for contributions made to its apex body. The Assessing Officer initially rejected these claims, but the Tribunal later upheld the Assessee's position, allowing the deductions. Issue 2: Double deduction on depreciation: The Tribunal's decision to allow double deduction on depreciation was questioned in light of the Supreme Court's decision in Escorts India Ltd. Vs. UOI, emphasizing against permitting two deductions on the same expenditure without clear statutory indication. Issue 3: Set off of brought forward unabsorbed depreciation and losses: The Tribunal's decision to restore the issue for allowing set off of brought forward unabsorbed depreciation and losses was challenged, arguing that depreciation on capital assets should not be allowed when deduction for capital expenditure has already been claimed. Issue 4: Adjustment of excess income application: The Tribunal directed the Assessing Officer to consider adjusting the excess amount of income application from the previous year in the current year. This direction was contested, citing the absence of specific provisions in Sections 11 to 13 of the Act for such adjustments. Issue 5: Payment to Haryana Agriculture Marketing Board: The Tribunal allowed the payment of 30% of market fees to the Haryana Agriculture Marketing Board as application of income for charitable purposes. However, it was argued that this payment was a statutory obligation and not a voluntary application of income. The judgment dismissed the appeals, upholding the Tribunal's decisions on the issues raised, emphasizing that adjustment against excess expenditure of an earlier year is considered application of income under Section 11 of the Act, in line with legal precedents like CIT v. Maharana of Mewar Charitable Foundation.
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