9911796707
TMI Blog2017 (5) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... the Revenue has taken four grounds of appeal in each assessment year, but its grievance revolves around a single issue viz. the ld.CIT(A) has erred in deleting the disallowance of Rs. 2,58,77,712/- and Rs. 1,70,51,660/- for the Asstt.Years 2007-08 and 2008-09 respectively, which were disallowed by the AO out of claim of depreciation on lease hold building and plant & machinery. 4. In response to the notice of hearing an adjournment application was filed by Shri Chirag Shah vide letter dated 24.1.2017. "Respected Sir, With reference to above appeal has been fixed for hearing before you on Dt. 31/01/2017. However, as factual details are under preparation, so we have to urge upon your honor for kindly adjourning the hearing for some days. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... training, furniture, duties & taxes and recurring costs. Object of the assessee-society was to carry out activities of providing technical, advisory and consultancy services for small scale units and are providing services for developing products and training of personnel in tool room. The assessee has filed its return of income for the Asstt.Year 2007-08 on 29.10.2007 declaring a loss of Rs. 2,65,80,930/-. Similarly, for the Asstt.Year 2008-09, it has filed return on 17/0/2008 declaring total loss of Rs. 54,50,675/-. The ld.AO has harboured a belief that since building and infrastructure were stated to have been provided by the Govt. of Gujarat/Govt. of India/German Government, depreciation claimed by the assessee and allowed in the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Government funds as well as own funds whereas in the case of the appellant the facts are different. The contributions for various assets are being made to certain extent by the various promoting parties i.e. Government of India, Government of Germany and Govt. of Gujarat. In addition the appellant is also earning by way of fees received from the students. The Memorandum of Association in clause-49 deals with funding of the society which includes grants made by the respective governments, donations, loans and grants, income from investments and savings, receipt from trainees and from various other services etc. I agree with the contentions of the appellant that what has been provided by the various governments are in the nature of promote ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 43(1) of the Incometax Act, 1961, is to be interpreted liberally. Accordingly, such subsidy does not par-take all the incidents which attracts the condition for its deductibility from "actual cost." It was, therefore, held that amount of subsidy is not liable to be deducted from the actual cost u/s.43(1) for the purpose of calculation of depreciation. Respectfully following the proposition of law as laid down by the Hon'ble Supreme Court and thereafter by various Courts, as narrated above, we do not find any merit in the action of the lower authorities for reducing the amount of Government grant from the actual cost of plant and machinery and building for the purpose of allowing assessee's claim for depreciation. Accordingly we rev ..... X X X X Extracts X X X X X X X X Extracts X X X X
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