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TMI Blog2012 (12) TMI 1159X X X X Extracts X X X X X X X X Extracts X X X X ..... Appeals)-VI, Chennai, whereas, appeal for assessment year 2008-09 is directed against an order of Commissioner of Income Tax (Appeals)-V, Chennai. 2. Revenue s appeal for assessment year 2003-04 in I.T.A. No. 277/Mds/2012 was delayed by four days. We are satisfied that reasonable cause has been shown by the Revenue for the delay in its affidavit. No serious objection was raised by the learned A.R. in this regard. Hence, we condone the delay and admit the appeal. 3. The sole issue raised by the assessee in its appeals is that CIT(Appeals) confirmed taxing of the lease rent including the principal portion as income of the assessee, and allowing depreciation. As per the assessee, lease transactions were nothing but financial leases and A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lease amount due were treated as receivable in its balance sheet. Assessing Officer, however, was of the opinion that only if the transactions were considered as operational lease, the lessor would be eligible for depreciation. Nevertheless, according to him, assessee in such a case was obliged to show entire lease rent as its income. Here, the assessee only considered interest portion of lease rental, whereas, principal portion of lease rental was not reckoned for calculating its income. He, therefore, completed the assessment for Assessment Years 2006-07 to 2008-09 considering the principal portion of lease rental also as part of income of the assessee. 6. Assessments for all other assessment years starting from 2002-03 and ending up t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eceivables. Assessee also pointed out that it had not charged as depreciation in the books, for such amounts. Nevertheless, according to it, depreciation claimed in tax computation could not be added back, since such depreciation could be claimed even for financial leases. For assessment year 2003-04, the assessee also raised a ground challenging the addition of ` 19,63,956/- on the income returned as per the revised return. Ld. CIT(Appeals) was of the opinion that principal amount of lease rental was correctly considered by the Assessing Officer as income of the assessee. However, insofar as addition of ` 19,63,956/ made for assessment year 2003-04 was concerned, CIT(Appeals) was of the opinion that assessee having adjusted the value of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r years, assessee itself had filed revised returns pursuant to a reopening under Section 148 of Income-tax Act, 1961 (in short 'the Act') showing the lease rentals as a part of its income. Therefore, it could not now turn back and say that such amounts included in the returns filed should not be considered for assessments. 10. We have perused the orders and heard the rival submissions. For assessment years 2006-07, 2007-08 and 2008-09, original assessments, which have culminated in appeals before us, were completed under Section 143(3) of the Act. For all other years, the assessments against which appeals are before us, were completed under Section 147 read with Section 143 of the Act. Assessee had pursuant to reopening notice fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epreciation had to be allowed on leased assets. If the assets belong to the assessee, depreciation will have to be allowed since lease rentals on such assets will be part of its income. If the assets do not belong to assessee, depreciation can be claimed only by the lessees. Then lease rental, but for the financial charges may go to reduce the dues from lessees on account of the principal amounts due. In our opinion, assessee cannot have the cake and eat it too. Once it had claimed depreciation, it was necessary for it to show lease rentals as part of its income. Treatment given by the Assessing Officer and confirmed by the CIT(Appeals) cannot be faulted. 11. Coming to addition of ` 19,63,956/- made for assessment year 2003-04, which was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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