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TMI Blog2015 (12) TMI 842X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act come into play only when the asset in question is acquired from outside India whereas, as is the undisputed position on the facts of this case, the related plant and machinery was “indigenous”. There is a categorical finding to that effect by the Assessing Officer himself. As such, the provisions of section 43A of the Act do not come into play at all. Learned Departmental Representative could not point out any other statutory provision under which impugned adjustment could have been made. In view of these discussions, we see no reasons to disturb the relief granted by the ld. CIT(A). We approve the same and decline to interfere in the matter. - Decided against revenue. Depreciation on computer software - Held that:- This issue is rendered infructuous as the matter has been decided , in favour of the assessee, in the case of DCIT vs. Icon Data Management Limited [2012 (11) TMI 1096 - ITAT AHMEDABAD]- Decided against revenue. - ITA Nos.830 & 2508/Ahd/2008 - - - Dated:- 30-9-2015 - Pramod Kumar AM and Kul Bharat JM For The Revenue : R.I. Patel For The Assessee : S.N. Soparkar ORDER Per Pramod Kumar AM: 1. These three appeals pertain to the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng and stationery expenses of ₹ 14,53,189/-, electricity charges of office of ₹ 27,99,095/-, business promotion expenses of ₹ 3,29,364/-, books and periodical expenses of ₹ 1,81,253/-, newspaper and magazine expenses of ₹ 1,35,695/- and rent of ₹ 1,20,000/-. Assessee submitted that at Delhi branch the export of trading goods i.e. yarn was carried out and only one person was engaged and the clearing and forwarding was done through an agent. The connected salary expenses allocated by the appellant was of ₹ 2 lakhs and rent, rates and taxes of Delhi office of ₹ 1.20 lakhs attributable to trading of export goods have been considered. Assessee had considered clearing and forwarding expenses of ₹ 16 lakhs has been directly related to trading export. The major administrative expenses of Modem and V Sat expenses of ₹ 40.48 lakhs are related to soda ash manufacturing. Similarly it was contended on behalf of assessee that entire traveling expenses of ₹ 1,62,56,816/- was for soda ash manufacturing. Lease rent and rented house expenses was not for trading export, legal and professional expenses of ₹ 2,93,55,772/- have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ully considered the submissions made and the decisions cited by the ld. A.R. and the observations of the A.O. in the assessment order. The appellant has availed foreign currency loan from IDBI and Export Import Bank of India for acquisition of indigenous plant and machinery. The appellant has received exchange fluctuation gain of ₹ 1,79,20,653/- during the relevant year. Relying on the decision of S.C. in Sutlej Cotton Mills Ltd. Cited supra, as the gain was in respect of a capital asset it is considered as a capital receipt. As the loan was used for acquisition of capital asset, the said transaction was clearly on capital account. It being a capital receipt it is not taxable. The Assessing officer has not objected to the treatment of the exchange fluctuation gain as a capital receipt, but he has redacted the exchange fluctuation gain from the cost of fixed asset and reduced the depreciation claim applying provisions of Sec. 43A of the I.T. Act. As Plant and machinery was not purchased from a country outside India, the ld. A.R. has strongly contended that provisions of Sec. 43A are not applicable in the case of the appellant. The Act is silent as to how the adjustments will h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he A.O. is directed not to reduce the cost of fixed assets for depreciation purpose. This ground is thus allowed. 13. We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. 14. As learned CIT(A) has rightly held, the provisions of section 43A of the Act come into play only when the asset in question is acquired from outside India whereas, as is the undisputed position on the facts of this case, the related plant and machinery was indigenous . There is a categorical finding to that effect by the Assessing Officer himself. As such, the provisions of section 43A of the Act do not come into play at all. Learned Departmental Representative could not point out any other statutory provision under which impugned adjustment could have been made. In view of these discussions, we see no reasons to disturb the relief granted by the ld. CIT(A). We approve the same and decline to interfere in the matter. 15. Ground no.3 is also dismissed. 16. In the result, the appeal is dismissed. 17. We now take up ITA No.2508/Ahd/2008. This appeal is filed against the order dated 28th April, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed by the learned Commissioner of Income Tax (Appeals) VIII, Ahmedabad [hereinafter the learned CIT(A)] for the captioned year, presents this appeal on following amongst other grounds : 1. The learned CIT(A) erred in law and on fact in confirming disallowance of depreciation of ₹ 9,24,877/- by reducing foreign exchange fluctuation gain of ₹ 61,65,848/- accrued during previous year relevant to assessment year 2008-09, on foreign currency loan borrowed to acquire indigenous plant and machinery, from WDV on plant and machinery without appreciating the fact that the same as capital receipt non exigible to tax as per sec. 43A/43(1) of the Income Tax Act. 26. Learned representatives fairly agree that whatever we decide, on this issue, for the assessment year 2004-05 will apply for this assessment year as well. In our adjudication on this issue for the assessment year 2004-05, we have rejected the grievance of the Assessing Officer and upheld the relief granted by the ld. CIT(A). Following the view so taken, we uphold the impugned relief granted by the ld. CIT(A) and decline to interfere in the matter. 27. In the result, this appeal is also dismissed. 28. ..... 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