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TMI Blog2021 (4) TMI 536X X X X Extracts X X X X X X X X Extracts X X X X ..... has erred in directing the Assessing Officer to allow the assessee's claim of additional depreciation by relying on the decision of Hon'ble High Court of Madras in the case of M/s. Brakes India Limited. 2. Facts relating to the disallowance of addition depreciation are that the assessee has claimed additional depreciation of Rs. 3,68,97,816/- as carry forward depreciation in the last previous year. In the assessment order, the Assessing Officer has noticed that the claim of the assessee relates to assets acquired in the preceding assessment year, wherein, the assets were used for less than 180 days and only 10% of depreciation was claimed in earlier year. Thus, in the present assessment year, the assessee has claimed the residual 10% of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal in assessee's own case in the assessment years 2006-07, 2007-08 as well as in the assessment year 2012-13. Vide order in I.T.A. No. 3346/Chny/2016 for the assessment year 2012-13, the Coordinate Benches of the Tribunal has observed and held as under: "6. We have heard both sides, perused the materials on record and gone through the orders of authorities below. The issue involved in the appeal of the assessee is when the assessee has used new plant and machinery less than 180 days, whether the assessee is eligible for remaining balance of 50% of additional depreciation in subsequent year by carry forwarding the claim. In this case, the assessee has submitted that only 10% of depreciation was claimed in the year of installation since t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 2002 with effect from 01.04.2003. Therefore, it was imperative that on and after 01.04.2003, the claim of the assessee made under section 32(1)(iia) of the Act, had to be necessarily assessed by applying the second proviso to section 32(1) of the Act. Therefore, when there was statutory stipulation providing for restriction to 50 per cent of the amount allowable under section 32(1)(iia) of the Act, no fault can be found with the conclusion of the Assessing Authority as well as that of the Appellate Authority and the Tribunal in having affirmed the action of the Assessing Authority. We, therefore, do not find any scope to entertain the said question of law." 8. From the above decision of the Hon'ble Jurisdictional High Court, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ious to the relevant assessment year. 8. The aforesaid two conditions, i.e., the undertaking acquiring new plant and machinery should be a new industrial undertaking, OF that it should be claimed in one year, have been done away by substituting clause (iia) with effect from 01.0.2006. The grant of additional depreciation, under the aforesaid provision, is for the benefit of the assessee and with the purpose of encouraging industrialization, by either setting up a new industrial unit or by expanding the existing unit by purchase of new plant and machinery, and putting it to use for the purpose of business. The proviso to Clause [ii] of the said Section makes it clear that only 50% of the 20% would be allowable, if the new plant and machin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tional depreciation allowed under Section 32(1)(iia) of the Act is a onetime benefit to encourage industrialization, and provisions related to it have to be construed reasonably, liberally and purposively, to make the provision meaningful while granting additional allowance. We are in full agreement with such observations made by the Tribunal." 9. In view of the above judgement of Hon'ble Karnataka High Court, we are of the considered opinion that the ld. CIT(A) has rightly followed the above judgement and directed the Assessing Officer to allow additional depreciation. Thus, we find no infirmity in the order passed by the ld. CIT(A) on this issue and the ground raised by the Revenue is dismissed." The ld. DR could not controvert the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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