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TMI Blog2015 (9) TMI 429X X X X Extracts X X X X X X X X Extracts X X X X ..... nvalid and the assessment order passed ought to be cancelled. 2. Learned CIT (A) has erred in confirming the disallowance of depreciation of Rs. 1,19,88,000/- on the Air Pollution Control Equipment leased to Prakash Industries Ltd on the ground that the real nature of the transaction is finance lease and the appellant is not entitled to depreciation as per the decision of the Supreme Court in the case of Asea Brown Boveri Ltd. On the facts and in circumstances of the case, depreciation ought to be allowed to the appellant on the Air Pollution Control Equipment leased to Prakash Industries Ltd. 3. The appellant craves leave to add, alter, amend and/or rescind any grounds of appeal during the course of the hearing". 2. Ground no. 1 pertain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o Prakash Industries it was found that no air pollution control Equipment ever existed at Bilaspur and Chamba factory establishment belonging to Prakash Industries. Letter dtd. of CIT - III, Mumbai circulated among AOs of his charge in this case of bogus leasing transaction of Prakash Industries also indicated the involvement of Unichem Labs Ltd. from a perusal of records of Unichem Lab Limited. A.Y. 95-96, it is seen that tough lease agreements dated 24/09/1994, one transaction on 100% depreciable asset (air pollution control equipment) has been entered into for Rs. 1,19,88,000/- between Unichem Lab Ltd. and M/s. Prakash Industries, which has resulted in a claim of depreciation of Rs. 1,19,88,000/- of Unichem Lab Ltd. for AY 95-96. The ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee acquired APCE from M/s Ashish Engineering Works, Durg, which accordingly was supplied to PIL to their unit at Champa in Bilaspur. From the details as gathered by the AO, it was found that PIL had acquired APCE from M/s Sahib Engineering Works, Ludhiana. On the other hand, the department had cracked the racket of hawala transactions wherein PIL was one of the beneficiary. It was also noticed that the name of the assessee also appeared in the list of dubious transactions, prepared by the joint Investigation Wings at various places, featuring at sl. No. 68. 10. In the proceedings before the revenue authorities, the assessee submitted detailed evidence to prove that the transaction in question was an actual transaction and su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, on trucks financed by the assessee in the names of third parties. This ratio was applied in the decision of the coordinate Bench at Mumbai in the case of DCB Bank Ltd. vs DCIT, ITA No. 3000/Mum/2001 and 4892/Mum/2003 and other connected appeals of the assessee for various assessment years (wherein one of us was a party). The issue of depreciation came up in the case of IndusInd Bank Ltd. vs Add. CIT, reported in 135 ITD 165 (Mum SB), wherein the SB held that "only lessor can claim depreciation in case of operating lease ...". Accordingly, the lessor, i.e. the assessee, claimed the depreciation. At a later stage, during the lease period, differences arose between the assessee and PIL with regard to payment of lease amount, the issue was t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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