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TMI Blog2015 (2) TMI 804X X X X Extracts X X X X X X X X Extracts X X X X ..... one of the business assets which is allowable for granting of depreciation. In this context, it may also be noted that the assessee is being assessed under the head of "Income from business". Thus the order of the Tribunal in allowing the depreciation at 10 per cent. treating the creche building as a business asset cannot be found fault. - Decided in favour of assessee. Excess prices recovered and deposited with the DPEA - ITAT allowing the assessee's claim of liability for the assessment years 1984-85 and 1985-86 under the Drugs (Price Control) Order, 1979 - Held that:- The relevant provisions of the DPCO does not leave any option to the assessee to retain the excess amounts collected. Liability under the provisions of the DPCO is f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uilding' to the assessee for the assessment years 1983-84 to 1985-86 ? 2. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in allowing the assessee's claim of liability for the assessment years 1984-85 and 1985-86 under the Drugs (Price Control) Order, 1979 ? 3. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that the assessee's claim of liability for the assessment years 1984-85 and 1985-86 under the Drugs (Price Control) Order, 1979, was a statutory liability and as such is allowable ? 2. In this case, in the assessment for the assessment years 1983- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by it and directed the assessee to deposit the excess amount in the DPEA. The assessee disputed the allegations. But, however, as a matter of precaution paid certain amounts which was not accepted by the Government. The assessee approached the High Court and finally the assessee had deposited a sum of ₹ 55.49 lakhs which in fact the assessee had paid by May 11, 1990. The view of the authority was that the provision which is made by the assessee which came to be deposited that the DPEA is at best a contingent liability and not a statutory liability and as such not allowable as a deduction. The Tribunal for the assessment year 1982-83 in I. T. A. No. 567/Hyd/1987, vide its order dated December 26, 1989, upheld the contention of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held to be entitled at a high rate of depreciation than that were allowed on the simple buildings. 8. It is not in dispute that the creche building is situated within the same compound of the factory where the assessee carries on manufacturing activity. For the purpose of increasing efficiency, productivity of the women employees were engaged in the factory, creche is created by the assessee in a separate building. In other words, the creche building is being utilized in the process of manufacturing of the products. Considering the importance of the creche building, the creche building is included as one of the business assets which is allowable for granting of depreciation. In this context, it may also be noted that the assessee is bei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iability itself does not get obliterated as the liability is in fact on account of a statutory control order issued in exercise of the powers vested in the Government under the Essential Commodities Act. In fact, the Tribunal had taken the same view and had come to a conclusion after detailed analysis of the provisions of the DPCO that the liability imposed on the assessee with respect to excess amounts collected over and above the prices notified in the DPCO are of the statutory nature. The Tribunal also followed the ratio laid down by the Supreme Court in Kedarnath Jute Manufacturing Co. Ltd. v. CIT [1971] 82 ITR 363 (SC) whereunder the Supreme Court had analysed a similar control order issued under the Essential Commodities Act, viz., th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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