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TMI Blog2019 (5) TMI 1544X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee as mentioned by us here in above are not applicable on the facts of the case. We have already noted that the Namah building and property in Lakhani Centrium never entered the block of depreciable asset as income from them was falling under the head income from house property. In this view of the matter in our considered opinion learned CIT(A) has passed well reasoned order which does not need any interference on our part. Depreciation on car - appellant has capitalized the Audi car in the F.Y.2009-10 - car had been registered in the assessee s name on 04-02-2009 and the invoice was also dated 12-01- 2009 - HELD THAT:- Genuineness of the delivery document of Shreyons Automobiles which mentions that the vehicle was delivered on 19/6/2009. The genuineness is doubted solely on surmise and conjecture. The plea is that invoice is dated 12/1/2009 and registration date is 4/2/2009, hence it is claimed that it is hard to believe that it was delivered on 19/6/2009. Why it is so hard to believe that the assessee took delivery after four-month is not specified, the learned CIT-A has even suggested that it may not be the first time that the vehicle was delivered, signifying tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al gains of Rs,67,06,074/- were assessable. During the course of assessment proceedings the assessee objected to the proposed addition on the grounds that the said block was not extinguished as during the year the assessee had purchased property worth ₹ 1,24,68,460/- in Lakhani Centrium'. Moreover If was submitted that the assessee was using a part of his residential premises (Namah building) for office purposes, which was purchased in earlier years for ₹ 1,02,49,0407-, and the cost of the said building was also part of the depreciable block, The AO however, rejected the explanation on the grounds that both the properties were not part of the depreciable block. The AO noted That the income from 'Lakhani Cenfrium was being offered under the head 'income from house property' and on the 'Namah' building the assessee had not claimed any depreciation in the past or in the present, in the circumstances the AO concluded that the provisions of section 50 were attracted as the block of assets ceased to exist. 4. Against the above order the assessee appealed before learned CIT(A). Learned CIT(A) referred to the provisions of section 2(11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 49 shall be subject to the following modifications:- ( 1) where the full value of the consideration received or accruing as a result of the transfer of the asset together with the full value of such consideration received or accruing as a result of the transfer of any other capital asset falling within the block of the assets during the previous year, exceeds the aggregate of the following amounts, namely:- ( i) expenditure incurred wholly and exclusively in connection with such transfer or transfers; ( ii) the written down value of the block of assets at the beginning of the previous year; and ( iii) the actual cost of any asset falling within the block of assets acquired during the previous year, such excess shall be deemed to be the capital gains arising from the transfer of short- term capital assets; ( 2) where any block of assets ceases to exist as such, for the reason that all the assets in that block are transferred during the previous year, the cost of acquisition of the block of assets shall be the written down value of the bloc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he above order assessee is in appeal before us. We have heard both the counsel and perused the records. 6. Learned Counsel of the assessee submitted that assessee has sold a depreciable asset and purchased commercial property. He further stated that the flat purchased enters the block on acquisition, and it is not dependent upon the user. In this regard he referred to following case laws : * CIT Vs. GR Shipping (ITA No. 822/Mum/05 dated 17.7.2008) * CIT Vs. Oswal Agro Mills Ltd. Others (341 ITR 467) * Nirma Vs. ACIT (390 ITR 302) * E-City Vs. ACIT (24 ITR 73) * CIT Vs. Yamaha (328 ITR 297) 7. Per contra, learned Departmental Representative relied upon the orders of authorities below. He referred to the following decisions :- * ACIT Vs. Rishiroop Polymers (P) Ltd.(102 ITD 128) * Dinesh Kumar Gulabchand Agrawal Vs. ACIT (267 ITR 768) 8. We have carefully considered the submissions and perused the records. Upon careful consideration we note that assessee in this case has sold flat on which depreciation was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no stretch of imagination be said to be entitled for automatic entry into the block of depreciable asset. In this view of the matter, the reference to section 2(11), 43(6) 50 by learned CIT(A) is germane and support the case of the Revenue. Section 2(11) defines block of asset as a group of asset falling within the class of asset .. in respect of which the same percentage of depreciation is permissible. The income from Namah building and the premises in Lakhani Centrium was falling under the head income from house property and hence these premises cannot be said to be falling under any asset group on which any rate of depreciation is prescribed as on such asset no depreciation is permissible. 12. The case laws referred by learned Counsel of the assessee as mentioned by us here in above are not applicable on the facts of the case. We have already noted that the Namah building and property in Lakhani Centrium never entered the block of depreciable asset as income from them was falling under the head income from house property. In this view of the matter in our considered opinion learned CIT(A) has passed well reasoned order which does not need any inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19-06-2009. I have perused this document. Nowhere does this document specify that the delivery of the said car is being made for the first time. I agree with the AO that it is hard to believe that a car sold on 12-01-2009 and registered on 04-02-2009, would be delivered on 19-06-2009. In my opinion appellant has not been substantially able to prove that he was not in possession of the car in the F.Y. 2008-09. In the circumstance I have no reason to disturbed the computation of the AO on this ground. On the other hand there is every reason to believe that the car was ready to use in the F.Y. 2008-09. Therefore, in terms of Explanation 5, to section 32(1), the car was depreciable in A.Y.2009-10. In the circumstances the AO has rightly reduced the deprecation for A. Y, 2009- 10, in order to arrive at the WDV as on 01-04-2009. The AO may also consider taxing the gift in AY 2009-10, by that logic. However, I agree with the appellant that as the car was purchased in January 2009, it was entitled to only 50% of the eligible depreciation in A.Y.2009-10 and therefore the WDV as on 01-04-2009 should be ₹ 65,80,236/-, Hence, the allowable depreciation would be ₹ 9t87,035/. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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