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TMI Blog2014 (10) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... ur of the assessee - the unabsorbed depreciation can be allowed under the head capital gains , however, it shall be restricted to 2/3rd of such allowance – thus, the matter is remitted back to the AO for re-computation of the unabsorbed depreciation and since the Company is in liquidation, the AO shall issue notice to the Official Liquidator – Decided in favour of Revenue. - T. C (A). No. 201 of 2014 - - - Dated:- 8-9-2014 - R. Sudhakar And G. M. Akbar Ali,JJ. For the Appellant : Mr. T. R. Senthilkumar For the Respondent : Through Official Liquidator counsel (under liquidation) Mr. B. Dhanaraj JUDGMENT ( Delivered by G.M.Akbar Ali, J.) Appeal filed against the order of the Income Tax Appellate Tribunal B Bench, Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 99,150/-, whether it be assessed as income from business or income from Other Sources, will also get set off against the unabsorbed depreciation. In the result I direct the assessing Officer to set off the entire income assessed against the unabsorbed depreciation and fix the total income of the appellant for the current year at Nil . The Appeal is thus allowed . 4. Aggrieved by which, the Revenue has preferred an appeal before the Tribunal. Before the Tribunal, it was submitted by the assessee that the issue was covered by the decision of the Tribunal for the same Assessment Year of 1992-1993 in ITA Nos. 350 and 351 of 1995 dated 13.3.2003, whereby the Tribunal has confirmed the action of the Commissioner (Appeals), following the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd they have served notice to the Official Liquidator and on subsequent hearings, on 26.8.2014 Mr.B. Dhanaraj, entered appearance for the Official Liquidator and submitted that he has been served with the papers. Therefore, it is recorded that the assessee is under liquidation and the Official Liquidator is representing the assessee. 8. The learned counsel for the Revenue submitted that Commissioner of Income Tax (Appeals) as well as the Tribunal have not considered the restrictions under sec.34A of the Act which came into effect on 1.4.1992 and was in force for the Assessment Year 1992-93. The learned Standing Counsel pointed out that as per the amended section, the set off of unabsorbed depreciation allowance or unabsorbed investment a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ast years should be added to the depreciation of the current year and the aggregate of the unabsorbed depreciation and the current year's depreciation to be deducted from the total income of the previous year relevant for the assessment year 1952-53? , and answered in favour of the assessee. The Commissioner (Appeal) placed reliance on the above decision while allowing the appeal by the assessee. 11. In Garden Silk Weaving Factory vs Commissioner of Income Tax reported in (1991) 189 ITR 512 (SC) cited supra, Sec.32(2) of 1961 Act was considered by the Hon'ble Supreme Court. While answering the question whether unabsorbed depreciation can be carried forward and set off , the Hon'ble Supreme Court answered in favour of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is no such allowance for that previous year, be deemed to be the allowance for that previous year and so on for the succeeding previous years; (b) where it relates to investment allowance, be carried forward to the assessment year commencing on the 1st day of April, 1993, and the balance of the investment allowance if any still outstanding shall be carried forward to the following assessment year and where the period of eight years has expired before the portion of such balance is adjusted, the said period shall be extended beyond eight years till such time the portion of the said balance is absorbed in the profits and gains of the business of the domestic company . and held From the reading of the above clause it is clear tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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