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TMI Blog2018 (4) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... and without losing the unsaved data when the power goes off. Therefore, in our opinion, UPS also can be considered as a computer if it is connected to the ATM Machine or a Computer and depreciation thereon is allowable at 60%. AO is directed to verify if the UPS are used for the functioning of the ATM and allow depreciation accordingly. Interest on non-performing assets/sticky loan is to be recognized only when it is received or credited to the P&L A/c. - Held that:- We direct the AO to consider the interest on NPAs as income only in the year of receipt. The addition is accordingly deleted - ITA No.1265/Hyd/2016 - - - Dated:- 28-2-2018 - Smt. P. Madhavi Devi AND Shri S.Rifaur Rahman For the Appellant: Shri C.V.Narasimham ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.09.2013 admitting total income of ₹ 3,97,50,110. The return was initially processed u/s 143(1) and later on, selected for scrutiny. During the assessment proceedings u/s 143(3) of the Act, the AO observed that the assessee has claimed depreciation @ 60% on UPS Batteries, ATM, ATM related accessories, iPad accessories and Cash Dispenser Machine, whereas according to the AO, the depreciation allowable on these items is only 15%. He considered the definition of computer under the Information Technology Act, 2000 and has held that the UPS is just an instrument to ensure uninterrupted power supply and to regulate the flow of power to computer system, therefore, cannot be considered as part of the computer. He accordingly held that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T-2(1) vs. Datacraft India Ltd (2011) 9 ITR (Tri) 712 Mum. d) DCIT vs. Saraswat Infotech Ltd (ITA No.1494/Mum/2015d), dated 22.11.2016 e) DCIT vs. Global Trust Bank Ltd (ITA No.474/Del/2009 dated 20.04.2011) 5. The learned DR, on the other hand, supported the orders of the authorities below. 6. Having regard to the rival contentions and the material on record, we find that in the case of CIT vs. Orient Ceramics and Industries Ltd (Supra), the Hon'ble Delhi High Court has followed the decision of the Coordinate Bench of the High Court in the case of CIT vs. BSES Yamuna Powers Ltd to allow depreciation @ 60% on computer peripherals and accessories and also UPS. We find that in the case of CIT vs. BSES Yamuna Power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce, pay bills, purchase goods and services and therefore, unless it is computerized and linked with the main server, it is not possible to operate the ATM. 10. From the reading of the above judgments, we find that the assessee is eligible for depreciation @ 60% on ATM and other related accessories. As regards depreciation @ 60% on UPS is concerned, we find that though the UPS can independently function without the assistance or integration with a computer and is an alternate mode of supply of power and does not depend on any assistance from a computer, the computer can function only on a power supply and when there is no power supply, it is connected to UPS so that it can work uninterruptedly and without losing the unsaved data when th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before us. The Ld. counsel placed before us a copy of the latest order of the Hon ble Gujarat High Court in the case of Pr. Commissioner of Income Tax Vs. Shri Mahila Sewa Shakari Bank Ltd.,(ITA No. 531 of 2015, dated 0508-2016), wherein the bench referred to catena of decisions and decided in favour of the assessee by observing as under: 11. From the rival submissions advanced by the learned counsel for the respective parties, it is evident that there is no dispute that the RBI Guidelines are applicable to the assessee. It is the case of ITA No.1194/Hyd/2016 The Kranti Co-operative Urban Bank Ltd., Hyderabad. The assessee that in view of the RBI Guidelines, it cannot charge interest on accrual basis and that following the theory of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equent years, the interest on NPAs is not brought to tax by the revenue and suddenly in this year, the revenue made an addition. He further submitted that there are catena of decisions with regard to the accrual of income only in the year of receipt. Even if it is assumed that there are two views possible, as per the decision of the Hon ble Supreme Court in the case of CIT Vs. Vegetable Products ITA No.1194/Hyd/2016 The Kranti Co-operative Urban Bank Ltd., Hyderabad Ltd., (1973) 88 ITR 192 (SC), a view which is favourable to the assessee has to be taken and thus he strongly submitted that the addition made by the A.O, and confirmed by the CIT(A), is not in accordance with law. 8. The Ld. DR, on the other hand, submitted that the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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