2019 (7) TMI 1362 - HC - Income Tax

Claim for amortisation of spares - ITAT deleted the addition - HELD THAT - ITAT has noticed in the impugned order that the Assessee has consistently adopted the straight line method to determine depreciation in respect of spares. Based on the rule of consistency therefore, the ITAT found no reason to interfere with the order passed by the CIT (A) in favour of the Assessee. The Court for the same reason also finds no ground to interfere with the impugned order of the ITAT. No substantial question of law arises.

Summary

Issues:
1. Delay in re-filing the appeal.
2. Justification of amortisation of spares by the Assessee.

Issue 1: Delay in re-filing the appeal
The High Court condoned a delay of 339 days in re-filing the appeal, as per the application's reasons. The delay application was disposed of accordingly.

Issue 2: Justification of amortisation of spares by the Assessee
The appeal by the Revenue was against an ITAT order dated 9th February, 2018, for the Assessment Year 2005-2006. The main question raised was whether the ITAT was correct in affirming the CIT(A)'s findings regarding the Assessee's claim for amortisation of spares not being excessive. The ITAT observed that the Assessee consistently used the straight-line method for depreciation on spares. Due to the rule of consistency, the ITAT did not see any reason to interfere with the CIT(A)'s decision in favor of the Assessee. The High Court also upheld this decision, stating that no substantial question of law arose, and consequently, the appeal was dismissed.