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TMI Blog2019 (12) TMI 613X X X X Extracts X X X X X X X X Extracts X X X X ..... considered opinion, the action of the Assessing Officer is not acceptable and since the ld. CIT(A) has upheld the action of the Assessing Officer, both the lower authorities have erred in making the addition and sustaining the addition. Addition is unwarranted and deserves to be deleted. Accordingly, Ground No. 2 is allowed. Disallowance on account of depreciation on car and interest on car loan - allowable revenue expenses - HELD THAT:- Depreciation has been claimed by the assessee on the written down value of the asset which means that in earlier years, the asset was used for the purposes of business. Nowhere the Assessing Officer has brought any material evidence on record to suggest that there is a closure of business activities. O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .K. BILLAIYA, ACCOUNTANT MEMBER, This appeal by the assessee is preferred against the order of the Commissioner of Income Tax [Appeals] - 4, New Delhi dated 15.02.2019 pertaining to assessment year 2015-16. 2. Ground No. 1 is general in nature and needs no separate adjudication. 3. Ground No. 2 relates to the addition of ₹ 63.36 lakhs added by the Assessing Officer as rental income by adding security deposit. 4. Ground No. 3 relates to the disallowance of ₹ 65,22,615/- on account of depreciation and interest on capital. 5. Briefly stated, the facts of the case are that the assessee filed its return of income on 23.09.2015 declaring total loss of ₹ 20,61,555/-. Return was s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of the assessee did not find any favour with the Assessing Officer who was of the firm belief that the security deposit should have been adjusted towards unrealised rent and referring to the relevant clauses of lease agreement, the Assessing Officer added a sum of ₹ 63.36 lakhs. 11. The assessee carried the matter before the ld. CIT(A) but without any success. 12. Before us, the ld. AR brought to our notice the decision of the Hon'ble High Court of Delhi in assessee s own case in CS(COMM) 75/2016 IA 1588/2016 and pointed out that the Hon'ble High Court, vide order dated 06.04.2016 decreed in favour of the assessee and against the tenant with the direction that the property should be handed over to the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urity deposit towards it unrealised rent. We further find that in A.Y 2016-17, the assessee has included ₹ 63.36 lakhs in it profit and loss account after the decision of the Hon'ble High Court of Delhi. In our considered opinion, the action of the Assessing Officer is not acceptable and since the ld. CIT(A) has upheld the action of the Assessing Officer, both the lower authorities have erred in making the addition and sustaining the addition. Considering the facts of the case in totality, addition of ₹ 63.36 lakhs is unwarranted and deserves to be deleted. Accordingly, Ground No. 2 is allowed. 17. Ground No. 3 relates to the disallowance of depreciation on car amounting to ₹ 45.31 lakhs and interest on car l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue of the asset which means that in earlier years, the asset was used for the purposes of business. Nowhere the Assessing Officer has brought any material evidence on record to suggest that there is a closure of business activities. On the contrary, we find that in furtherance of its business activities, the assessee has further advanced ₹ 65 lakhs towards land at Chandan Hola, Delhi which means that the assessee was, in fact, carrying out business activities during the year under consideration. 22. The Hon'ble High Court of Delhi in the case of Capital Bus Service 123 ITR 404 has held that the only condition for allowability of depreciation is that the business should not have been closed out once for all and that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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