9911796707
TMI Blog1998 (5) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... rder of the Commissioner of Income-tax (Appeals) on the ground that no injustice was caused to the Revenue by the order passed by the Commissioner of Income-tax (Appeals) in directing that the assessee was entitled to add a sum of Rs. 36,96,516 to the cost of building and claim depreciation thereon ?" The question is not very happily worded. A similar question was also raised in respect of the other assessment years. The question basically is : whether the assessee is entitled to depreciation in respect of a sum of Rs. 36,96,516 which it claimed as part of the actual cost of construction of a building constructed by it for business purposes. The assessee had purchased an existing residential building bearing Nos. 18-20, Kasturba Gandhi Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, Supplemental Indenture and herein, the lessor doth hereby grant his consent to the lessee using the multi-storeyed building under erection and construction on a part of the demised premises according to the plans sanctioned by New Delhi Municipal Committee vide its Resolution No. 30 dated January 20, 1967, save and except the built-up area of 51,198 square feet therein, for commercial purposes and the built-up area of 51,198 square feet in the said multi-storeyed building only for the purpose mentioned in the Supplemental Indenture." The assessee thus paid a sum of Rs. 36,96,516 for using the multi-storeyed building for commercial purposes containing an area in excess of 51,198 square feet. The assessee added this amount of Rs. 36,96,5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee had paid an additional amount of Rs. 3,65,875. There was no question, therefore, of any additional commercialisation of the said plot. The amount has, however, been paid for the additional construction which has been put up by the assessee and hence forms a part of the cost of the building. For the land, the assessee has paid additional ground rent under the said agreement of March 5, 1973, which is a separate amount. The High Court has, therefore, upheld the view taken by the Tribunal that the sum of Rs. 36,96,516 has been laid out by the assessee in order to construct the additional space of 3,45,144 square feet for office purposes. The payment has been made for construction of a business asset and forms a part of the cost inc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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