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Issues:
1. Addition of depreciation to book profit 2. Charging of interest under sections 234B and 234C Analysis: Issue 1: Addition of Depreciation to Book Profit The appeal by the Revenue challenged the order of the CIT(A) regarding the addition of Rs. 20,77,946 to the book profit on account of additional depreciation debited in the accounts for earlier years due to a change in the method for providing depreciation retrospectively. The AO disallowed the claim of the assessee, citing that the change in the method of depreciation was an attempt to avoid tax by resorting to a colorable device. The CIT(A) upheld the assessee's contention, considering the provisions of the Companies Act, Section 115J of the IT Act, and relevant judicial decisions. The CIT(A) found that the change in method was permitted by Accounting Standards and not barred by the Companies Act or Section 115J of the IT Act. Issue 2: Charging of Interest under Sections 234B and 234C The CIT(A) directed the AO not to charge interest under sections 234B and 234C if the assessee's income is determined under Section 115J. This direction was based on precedents from the Delhi Bench and the Ahmedabad Bench 'B,' supporting the non-charging of interest under these sections in specific circumstances. The Tribunal upheld the CIT(A)'s decision, citing similar favorable judgments in other cases. In conclusion, the Tribunal dismissed the appeal, upholding the CIT(A)'s orders regarding both the addition of depreciation to book profit and the non-charging of interest under sections 234B and 234C. The Tribunal found no grounds to interfere with the CIT(A)'s well-reasoned decisions based on legal provisions, accounting standards, and relevant judicial precedents.
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