2016 (8) TMI 111

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..... ed” as there was no liability to tax and hence, no income-tax assessment for this period. It has further held that the written down value (WDV) for the purpose of assessment would be the original cost less nil, i.e., the original cost. This interpretation is not in conformity with the intent and purpose of the provisions of depreciation. Accordingly, Explanation 6 has been inserted in sub-section (6) of section 43 to clarify that in such a case - (a) the actual cost of the asset shall be adjusted by the amount attributable to the revaluation of such asset, if any, in the books of account of the assessee; (b) the total amount of depreciation on such provided in the books of account of the assessee in respect of such previous year or ye .....

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..... ome Appellate Tribunal was right in holding that the depreciation should be allowed on the original value of assets even though certain assets were old and obsolete and the respondent had claimed depreciation in its books of accounts for the same? ii) Whether on facts and circumstances of the case the Income Tax Appellate Tribunal was right in holding that the depreciation should be allowed in block of assets on the original value even when certain assets had nil value or were written off in the books of accounts? iii) Whether roads and boundaries, railway sidings, jetty pire, bouys, mooring and navigation structure can be considered as plant and machinery or building for the purpose of granting of depreciation under Sec. 32 of the In .....

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..... e was exempt cannot be treated as the depreciation actually allowed . Accordingly, it was held that as the assessee was not required to compute profits and gains of business or profession under the Income-tax Act, mere passing of accounting entry made for depreciation in the books of accounts was not the depreciation actually allowed as there was no liability to tax and hence, no income-tax assessment for this period. It has further held that the written down value (WDV) for the purpose of assessment would be the original cost less nil , i.e., the original cost. This interpretation is not in conformity with the intent and purpose of the provisions of depreciation. Accordingly, Explanation 6 has been inserted in sub-section (6) of sect .....

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