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TMI Blog2017 (5) TMI 1555X X X X Extracts X X X X X X X X Extracts X X X X ..... , Accountant Member For The Revenue : Shri Deepak Sutaria, Sr. D.R. For The Assessee : Shri P.M. Mehta, A.R. ORDER PER : AMARJIT SINGH, ACCOUNTANT MEMBER:- This Revenue s appeal for A.Y. 2008-09, arises from order of the CIT(A)-VIII, Ahmedabad dated 16-07-2013 in appeal no. CIT(A)- VIII/ACIT/Cir-4/16/12-13, in proceedings under section 154 of the Income Tax Act, 1961; in short the Act . 2. The assessee has raised following grounds of appeal:- 1. The Ld. CIT(A) has erred in law and on facts in allowing the brought forward unabsorbed depreciation of ₹ 38,76,64,533/- beyond 8 years pertaining to A.Y.2000-01 which was rejected by the Assessing Officer as per provisions of subsection 2(iii)(b) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er:- 2.3 Decision : I have carefully considered the facts of the case, the order of the A.O and the written submission given by the appellant. The assessing officer has disallowed the brought forward unabsorbed depreciation for A.Y. 2000- 01 as according to him as per the provisions of sub section 2(iii)(b) of Section 32 it could not be carried forward for more than eight assessment years immediately succeeding the assessment year for which the allowance was first determined. After considering of all the facts and various provisions of the Income Tax Act, it is noted that the present issue is squarely covered by the decision of Hon'ble Gujarat High Court in case of General Motors (I) Pvt. Limited 210 Taxman 20 wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be carried forward and added to the depreciation allowance of the next year and be deemed to be part thereof. [Para 31] So, the unabsorbed depreciation allowance of assessment year 1996-97 would be added to the allowance of assessment year 1997-98 and the limitation of 8 years for the carry-forward and set-off of such unabsorbed depreciation would start from assessment year 1997-98. [Para 32] The provision of section 32(2) was introduced by Finance (No. 2) Act, 1996 and further amended by the Finance Act, 2000. The provision introduced by Finance (No. 2) Act was clarified by the Finance Minister to be applicable with prospective effect. [Para 34] The said CBDT Circular clarifies the intent of the amendment that it is for enabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, Circular No. 14 of 2001 had clarified that under section 32(2), in computing the profits and gains of business or profession for any previous year, deduction of depreciation under section 32 shall be mandatory. Therefore, the provisions of section 32(2) as amended by Finance Act, 2001 would allow the unabsorbed depreciation allowance available in the assessment years 1997-98, 1999-2000, 2000-01 and 2001-02 to be carried forward to the succeeding years, and if any unabsorbed depreciation or part thereof could not be set off till the assessment year 2002-03 then it would be carried forward till the time it is set off against the profits and gains of subsequent years. [Para 37] Therefore, it can be said that, current depreciation is d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions of section 32(2) as amended by Finance Act, 2001 and were available for carry forward and set off against the profits and gains of subsequent years, without any limit whatsoever. [Para 38] In view of the finding given by the Hon'ble jurisdictional High Court, the appellant is entitled for carry forward of depreciation which has been denied by the A.O. Respectfully following the decision of jurisdictional High Court, the A.O is directed to allow set off and carried forward of depreciation without any limit. 6. We have heard the rival contentions. We have also perused the judicial pronouncement delivered by the Hon ble High Court of Gujarat in the case of General Motors India (P.) Ltd vs. DCIT (2012) 25 taxmann.com ..... X X X X Extracts X X X X X X X X Extracts X X X X
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