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TMI Blog2018 (3) TMI 1461X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. CIT(A) is justified in allowing the assessee's appeal neglecting the finding of Assessing Officer regarding addition of Rs. 66,11,344/- being depreciation.." 3. The grievance raised by the revenue is no more res integra as the same is now well settled in favour of the assessee and against the revenue by the Hon'ble Supreme Court in a bunch of appeals in Civil Appeal No. 7186 of 2014. It would be appropriate to extract the judgment of the Hon'ble Supreme Court for the sake of the completeness of the adjudication. "These are the petitions and appeals filed by the Income Tax Department against the orders passed by various High Courts granting benefit of depreciation on the assets acquired by the respondents-assessees. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove, the first question which requires consideration by this Court is: whether depreciation was allowable on the assets, the cost of which has been fully allowed as application of income under section 11 in the past years? In the case of CIT v. Munisuvrat Jain 1994 Tax Law Reporter, 1084 the facts were as follows. The assessee was a Charitable Trust. It was registered as a Public Charitable Trust. It was also registered with the Commissioner of Income Tax, Pune. The assessee derived income from the temple property which was a Trust property. During the course of assessment proceedings for assessment years 1977-78, 1978-79 and 1979-80, the assessee claimed depreciation on the value of the building @2½% and they also claimed depreciati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the revenue that section 32of the Income Tax Act was the only section granting benefit of deduction on account of depreciation. It was held that income of a Charitable Trust derived form building, plant and machinery and furniture was liable to be computed in normal commercial manner although the Trust may not be carrying on any business and the assets in respect whereof depreciation is claimed may not be business assets. In all such cases, section 32 of the Income Tax Act providing for depreciation for computation of income derived from business or profession is not applicable. However, the income of the Trust is required to be computed under section 11on commercial principles after providing for allowance for normal depreciation and deduc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... covered by the decision of the Bombay High Court in the above Judgment. Consequently, Question No. 2 is answered in the Affirmative i.e., in favour of the assessee and against the Department." After hearing learned counsel for the parties, we are of the opinion that the aforesaid view taken by the Bombay High Court correctly states the principles of law and there is no need to interfere with the same. It may be mentioned that most of the High Courts have taken the aforesaid view with only exception thereto by the High Court of Kerala which has taken a contrary view in 'Lissie Medical Institutions v. Commissioner of Income Tax'. It may also be mentioned at this stage that the legislature, realising that there was no specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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