2018 (1) TMI 1305 - HC - Income Tax

Depreciation claim of assessee trust - double deduction - Held that - Supreme Court in Commissioner of Income Tax Vs. Rajasthan and Gujarati Charitable Foundation Poona 2017 (12) TMI 1067 - SUPREME COURT has upheld the decision of this Court in Institute of Banking Personnel Selection 2003 (7) TMI 52 - BOMBAY High Court and negatived the contention of the Revenue that by granting benefit of depreciation the assessee would be availing double benefit for the period prior to Assessment Year 2015-16. - Decided in favour of assessee.

Summary

Issues:
Challenge to Notice under Section 148 of the Income Tax Act, 1961 for reopening assessment for A.Y. 2010-11.

Analysis:
The petition under Article 226 of the Constitution of India challenges a Notice dated 23rd March, 2017 issued by the Deputy Commissioner of Income Tax under Section 148 of the Income Tax Act, 1961, seeking to reopen the assessment for A.Y. 2010-11. The reasons for issuing the notice included the claim of depreciation on assets leading to double deduction, citing judicial pronouncements. The petitioners objected to these reasons, relying on previous court decisions allowing depreciation on assets even if the cost had been claimed as capital expenditure earlier. The objections were rejected, but the Supreme Court's decision in Commissioner of Income Tax Vs. Rajasthan and Gujarati Charitable Foundation Poona supported the petitioners' position, leading to the quashing of the impugned notice.

Conclusion:
The High Court quashed and set aside the impugned Notice dated 23rd March, 2017, as the reasons for reopening the assessment were found to be untenable based on legal precedents supporting the petitioners' entitlement to claim depreciation on assets. The judgment highlighted the importance of legal interpretations and judicial decisions in determining the validity of tax assessments and emphasized the need for tax authorities to adhere to established legal principles.