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TMI Blog2020 (8) TMI 600X X X X Extracts X X X X X X X X Extracts X X X X ..... v) of the Income Tax Act read with Rule 87 and 88 of the Income Tax Rules would not constitute a question of law and would be in the realm of factual issue. The ITAT has observed in its order that no evidence was led by the Revenue-Appellant to dispute the correctness of the findings recorded by the CIT (Appeals). Depreciation of assets which were allowed as application of income - HELD THAT:- It is pertinent to note that the aforesaid issue is covered against the Revenue in terms of the judgment of the Apex Court RAJASTHAN AND GUJARATI CHARITABLE FOUNDATION POONA[ 2017 (12) TMI 1067 - SUPREME COURT ]- The order of the ITAT discusses, after relying on the Judgment of the Apex Court in the Rajasthani and Gujarati Charitable Foundation (supra) that the income of the trust is required to be computed u/s. 11 on commercial principles after providing for allowance for normal depreciation and deduction thereof from the gross income of the trust. Exemption u/s 11 - denying the benefits of Sections 11 and 12 by invoking proviso to Section 2(15) r.w. Section 13(8) - Claim of benefit u/s 2(15) - HELD THAT:- ITAT has clearly observed that the activities carried out by the Assessee are for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 respectively for the Assessment Years 2009-2010 to 2014-2015. 3. The Revenue has proposed the following substantial questions of law for the consideration of this Court: In Tax Appeal No. 157 of 2020 "(A) Whether on the facts and in the circumstances of the case, the Appellate Tribunal is justified in negating the findings of the CIT(A) as well as the Assessing Officer denying the benefits of Sections 11 and 12 of the Act by invoking proviso to Section 2(15) r.w. Section 13(8) of the Act? (C) Whether on the facts and in the circumstances of thecase, the Appellate Tribunal is justified in allowing the accumulation of 15% without appreciating the fact that once the provision of Section 2(15) r.w. Section 13(8) is applicable, the assessee forfeits all the exemptions under Sections 11 and 12 of the Act? (D) Whether on the facts and in the circumstances of thecase, the Appellate Tribunal is justified in deleting the deduction in the fixed assets of ₹ 34,49,94,135/without appreciating the fact that once the provision of Section 2(15) r.w. Section 13(8) is applicable, the assessee forfeits all the exemptions under Sections 11 and 12 of the Act? " In Tax Appeal No. 158 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8) is applicable, the assessee forfeits all the exemptions under Sections 11 and 12 of the Act? (D) Whether on the facts and in the circumstances of thecase, the Appellate Tribunal is justified in deleting the deduction in the fixed assets of ₹ 34,49,94,135/without appreciating the fact that once the provision of Section 2(15) r.w. Section 13(8) is applicable, the assessee forfeits all the exemptions under Sections 11 and 12 of the Act?" In Tax Appeal No. 160 of 2020 "Whether, on the facts and in the circumstances of the case, the Hon'ble ITAT is right in allowing depreciation on assets, full cost of which was already allowed as application in earlier years. The ratio of decision of the Supreme Court in Rajasthan and Gujarati Charitable Foundation is not applicable in the present case as in that case exemption under section 11 and 12 was available to the assesse, whereas in the present case, the exemption under section 11 and 12 is not available to the assesse as per the stand of the department. Therefore an AOP cannot be granted benefit of both depreciation and capital expenditure in accordance with normal business provisions of the Act? Whether, on the facts and in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le ITAT has erred in allowing the claim for exemption u/s. 11 & 12 to the assesse, without appreciating the findings of the CIT (Appeals) that the assesse has also violated the provisions of section 11(2)(b) r.w.s. 11(5) of the Act and thereby making it in-eligible for claim of exemption u/s. 11 & 12, in view of provisions of section 13 (1)(d) of the Act? Whether on the facts and in the circumstances of the case, the Hon'ble Tribunal is justified in allowing the accumulation of 15% without appreciating the fact that once the provisions of section 2(15) is applicable to the assesse, the assesse forfeits all the exemptions u/s. 11 and 12 of the Act in view of the provisions of section 13(8) of the Act? Whether, on the facts and in the circumstances of the case, the Hon'ble ITAT is justified in deleting dividend income without appreciating that in case the assesse is not entitled for exemption u/s. 11 & 12 of the Act, therefore, the disallowance as per Rule 8D r.w.s. 14A will be applicable?" In Tax Appeal No. 164 of 2020 "Whether, on the facts and in the circumstances of the case, the Hon'ble ITAT is right in allowing depreciation on assets, full cost of which was already allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment on the respective erstwhile state government employees in the earlier year, which was constantly allowed by the department, reversed the finding of the assessing officer and allowed the Assessee's appeal since those findings could not be controverted by the Revenue before the CIT(A). 4.3 The Tribunal affirmed the view of the CIT (A) after holding that the Revenue has not been able to controvert the findings of the CIT(A). 4.4 The issue relating to the contribution to pension fund under Section 36(1)(iv) of the Income Tax Act read with Rule 87 and 88 of the Income Tax Rules would not constitute a question of law and would be in the realm of factual issue. The ITAT has observed in its order that no evidence was led by the Revenue-Appellant to dispute the correctness of the findings recorded by the CIT (Appeals). 5. SECOND ISSUE: WHETHER THE ASSESSEE CAN CLAIM DEPRECIATION ON THE ASSETS WHEN THEIR PURCHASE WAS CLAIMED AS APPLICATION OF FUNDS (Being Question in Tax Appeals nos. 158, 160, 162 and 164 respectively of 2020) 5.1 As regards the claim of the Appellant that the Assessee cannot claim depreciation of such assets which were allowed as application of income, the case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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