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TMI Blog2015 (12) TMI 377X X X X Extracts X X X X X X X X Extracts X X X X ..... x Act, 1961 ( In short, the 'Act') vide order dated 16.11.2009. The assessee is engaged in the business of embroidery work of cloth. During F.Y. 2006-07, relevant to A.Y. 2007-08, the assessee firm purchased and installed new machinery in the month of August, 2006 and started the business of embroidery work of cloth. During the year under consideration, the assessee firm claimed additional depreciation of Rs. 18,25,184/- u/s 32(1)(iia) of the Act. Subsequently, it was noticed form the assessment record of the assessee, that additional depreciation claimed to the tune of Rs. 18,25,184/-, had wrongly been allowed, as the assessee was engaged in the job work of embroidery of cloth and not in the business of manufacture or production of any art ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee has not using the Machinery for the purposes which may entitle the assessee for additional depreciation. The case Laws quoted by the assessee do not help him as the facts of the cases reported by the assessee are therefore distinguishable to the facts of the case of the assessee under reference. The claim of the assessee of additional depreciation on machinery is not in accordance with the provisions of section 32(1)(ii) of the Income Tax Act, 1961. Since the assessee has failed to fulfill the conditions laid down in section 32(i)(ii) of the Income Tax Act, 1961, the claim of additional depreciation of assessee is, therefore, rejected and an addition of Rs. 18,25,184/- is made on account of disallowance of additional depreciation." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... machinery was not in accordance with the provisions of section 32(1)(ii) of the Act. 7. Despite due service of notice, none has appeared before me on behalf of the assessee, nor has any application for adjournment been filed. However, finding that the matter can be proceeded with in the absence of the assessee, I am doing so. 8. I have considered the ld. DR's contentions in the light of the material on record. The issue to be considered is as to whether the ld. CIT(A) has rightly quashed the order passed by the AO u/s 154 of the Act. 9. The Ld. CIT(A), it is seen, while quashing the rectification order passed by the AO, has placed reliance on the Ahmedabad Bench decision of the Tribunal in the case of "M/s. Hari Fashion vs. ACIT", passe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent rebate claimed; that the decision in "S.S.M Brothers (P) Ltd. & others" (supra), was directly applicable to the facts of that case, because section 32(1)(iia), like section 33(1)(b)(B)(i), also provides for additional depreciation in respect of new machinery and plant purchased by an assessee engaged in the business of manufacture or production of article or thing; that since section 32(1)(iia) also uses the expression 'production of any article or thing', any product with embroidery work is an article or thing; that the provisions of section 31(1)(iia) are larger in scope than those of section 33(1)(B)(b)(i) in asmuch as section 32(1)(iia) provides for additional depreciation on plant and machinery, which is used in the production/manu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bberizing, etc., of fabric are not so alien or foreign to the concept of "manufacture" that they could not come within that concept. "Empire Industries Ltd." (supra) was affirmed in "Sovrin Knit Works" (supra), following Empire Industries Ltd., (supra) and "Ujagar Prints" (supra), inter-alia, embroidery of grey cloth was held to constitute production and manufacture in terms of Item No.32 of the Fifth Schedule of the Income Tax Act, 1961. To reiterate, herein also, the activity under consideration is embroidery on grey cloth. 13. Then, "M/s. Hari Fashion" (supra) has also been relied on by the Amritsar Bench of the Tribunal in "S.S. Embroiders, Amritsar vs. Department of Income Tax", rendered on 23.04.2012 in ITA No.357(Asr)/2010, for the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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