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TMI Blog2015 (6) TMI 684X X X X Extracts X X X X X X X X Extracts X X X X ..... merely stating that the same are not relevant does not meet the requirement of natural justice viz. An order supported by reasons. In the above view of the matter, the impugned order of the Tribunal setting aside order of CIT (Appeals) and restoring it to him for fresh consideration cannot be found fault with. Disallowance of depreciation - Tribunal allowed claim - Held that:- Amount spent on acquiring assets are taken as application of income for the purposes of Section 11 of the Act and the depreciation claimed thereafter on the same amount i.e. the value of fixed assets during the subsequent years is being granted on the user of the same. Accordingly, in view of the decision of this Court in Institute of Banking (2003 (7) TMI 52 - BOMBAY High Court) and Ville Parle Kelavani Mandal (2015 (5) TMI 220 - BOMBAY HIGH COURT ) rendered on 23 March 2015 and an earlier decision in The Watch Tower Bible and Tract Society of India [2015 (1) TMI 480 - BOMBAY HIGH COURT], the Question stands concluded in favour of the respondent/assessee and against the revenue Disallowance of carry forward of excess application of income of the earlier years against the income of the year under cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such exclusion from the total income of the assessee. (iii) Whether, on the facts and in the circumstances of the case, and in law the Tribunal in allowing the assessee to claim depreciation also on the capital expenditure which was already allowed as deduction being application of income. In doing so, it has failed to correctly appreciate the decisions in case of (a) Escorts India Ltd. Vs. UOI 199 ITR 43 (SC) and (b) Lissie Medical Institutions Vs. CIT 348 ITR 344 (Ker)? (iv) Whether, on the facts and in the circumstances of the case, and in law the Tribunal in setting aside the order of the CIT(A) confirming the order of the AO disallowing carry forward of excess application of income of the earlier years against the income of the year under consideration. It failed to appreciate that application of income in a given year cannot exceed the income of that year and that there cannot be carry forward of excess application of income under any provisions of the I.T. Act, 1961? 3. Regarding Question No.(i): The Counsel are agreed that Question No.(i) stands concluded in favour of the respondent-assessee and against the appellant/revenue by the decision of this Court in M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the same are not relevant does not meet the requirement of natural justice viz. An order supported by reasons. In the above view of the matter, the impugned order of the Tribunal setting aside order of CIT (Appeals) and restoring it to him for fresh consideration cannot be found fault with. Accordingly, Question No.(ii) does not raise any substantial question of law and is accordingly not entertained. 5. Regarding Question No.(iii): (a) The respondent-assessee had claimed depreciation in respect of fixed assets. In the year of purchase of the fixed assets, the entire amount attributable to its purchase was shown as application of income for the objects of the respondent-assessee and thus exempt in terms of Section 11. The Assessing Officer disallowed the claim for depreciation on the ground that the same would amount to double deduction in as much as the entire amount attributable to purchase of fixed assets was not subject to tax as being applied for the object of the respondent-assessee and on the same amount, the respondent-assessee was claiming depreciation. (b) On appeal, the CIT (Appeals) upheld the decision of the Assessing Officer on the ground that allowing dedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Society of India in Income Tax Appeal No. 1548/2012 rendered on 10 December 2014 had occasion to also consider the issue in the context of identical submission being made by the revenue before us and after considering it's earlier decision including the order dated 5 March 2014 in Shanmukhanand Fine Arts and Sangitha Sabha (supra) admitting the appeal, came to the conclusion that there is no question of double deduction. This on the ground that amount spent on acquiring assets are taken as application of income for the purposes of Section 11 of the Act and the depreciation claimed thereafter on the same amount i.e. the value of fixed assets during the subsequent years is being granted on the user of the same. Accordingly, in view of the decision of this Court in Institute of Banking (supra) and Ville Parle Kelavani Mandal (supra) rendered on 23 March 2015 and an earlier decision in The Watch Tower Bible and Tract Society of India rendered on 10 December 2014, the Question No.(iii) stands concluded in favour of the respondent/assessee and against the revenue. Accordingly, Question No.(iii) does not give rise to any substantial question of law and is thus not entertained. 6. R ..... X X X X Extracts X X X X X X X X Extracts X X X X
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