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2019 (7) TMI 186 - HC - Income TaxSet off of Depreciation allowances - even after eight subsequent assessment years - scope of amendment to Section 32(2) by the Finance Act, 2001 - HELD THAT - In case of Principal Commissioner of Income Tax Vs. Accura Polytech (P.) Ltd.V 2017 (12) TMI 866 - GUJARAT HIGH COURT the very issue was before the Gujarat High Court. In the said case it was held that the amendment in Section 32(2) of the Act is applicable from Assessment Year 2002-2003 and subsequent years. It further observed that any unabsorbed depreciation available to an Assessee on 01.04.2002 will be dealt with in accordance with provision of Section 32(2) of the Act, as amended by the Finance Act, 2001 and not by the provisions of Section 32(2) of the Act, as it stood before the said amendment. Also confirmed by SC 2018 (9) TMI 1100 - SC ORDER - Decided in favour of assessee.
Issues:
1. Interpretation of Section 32(2) of the Finance Act, 2001 for Assessment Year 2008-2009. 2. Applicability of retrospective operation of the amendment to Section 32(2). 3. Consideration of unabsorbed depreciation under old and new provisions. Analysis: 1. The main issue in this case revolves around the interpretation of Section 32(2) of the Finance Act, 2001 for the Assessment Year 2008-2009. The petitioner questions the Tribunal's decision to allow depreciation allowances even after eight subsequent assessment years, disregarding the 2001 amendment to Section 32(2). The petitioner argues that the amendment should not have retrospective effect and relies on the Madras High Court judgment to support this contention. 2. Another significant issue raised is whether the Tribunal, by relying on a decision of a High Court not within its jurisdiction, was justified in allowing the depreciation allowances. The petitioner also questions the Tribunal's failure to consider a finding of the ITAT, Mumbai Bench regarding the treatment of unabsorbed depreciation under the new provision but in accordance with the old provision. The petitioner contests the Tribunal's decision based on these grounds. 3. The court considered the submissions of both parties and noted that a similar issue had arisen for the Assessment Year 2007-2008, where the court had dismissed the appeal filed by the Revenue. The court referenced judgments from the Gujarat High Court and the jurisdictional High Court to support its decision. It highlighted that the Gujarat High Court held the amendment in Section 32(2) applicable from Assessment Year 2002-2003 onwards and that unabsorbed depreciation should be dealt with according to the amended provision. The court also cited a judgment from the jurisdictional High Court concluding that no substantial question of law arises based on consistent views taken by the courts and the Apex Court, especially when previous assessments had ruled against the Revenue. In conclusion, the court dismissed the appeal, emphasizing that no substantial question of law arose based on the consistent views of various courts and the lack of success for the Revenue in previous assessments.
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