Commissioner of Income Tax (LTU) and Others vs Rittal India Pvt. Ltd. (No. 2)

N.K. Patil, J.—1. This appeal by the Revenue is arising out of the impugned order dated June 11, 2015, passed in I.T.A. No. 109/Bang/2015, by the Income-tax Appellate Tribunal, Bangalore Bench-A, Bangalore, for considering the following substantial question of law:

"(i) Whether the Tribunal was correct in holding that additional depreciation allowed under section 32(1)(iia) is a one-time benefit to encourage industrialisation and the relevant provisions has been construed reasonably and purposive without appreciating that the additional depreciation is allowed in the year of purchase and if in the year of purchase the assessee is eligible only for 50 per cent, depreciation, the balance 50 per cent, cannot be carried forward for the subsequent year or the claim cannot be allowed in any other year where the section 32(1)(iia) does not speak of any further depreciation except in the year of purchase?"

The assessee is a private limited company being a member of the Rittal group of Germany. It is engaged in the manufacture and sale of enclosures, heat exchangers and other electrical appliances. The return of income was filed for the assessment year 2010-11 declaring the total income of Rs. 4,26,76,850. In the draft assessment order under section 143(3) read with section 144C dated March 14, 2014, the Assessing Officer has determined the total income at Rs. 7,84,12,208 as there was a disallowance under section 32(1)(iia) of Rs. 3,53,65,893 being additional depreciation and an additional depreciation and an addition of Rs. 3,69,463 due to transfer pricing adjustments. The Assessing Officer disallowed the same since the additional depreciation under section 32(1)(iia) was allowable only in the first year of purchase. The Dispute Resolution Panel held that the claim of additional depreciation on assets installed during the period October 1, 2008, was allowable and directed allowance of additional depreciation claimed by the assessee under section 32(1)(iia) of the Act. The Tribunal allowed the claim based on its own decision in the assessee''s own case for the assessment year 2008-09. The Tribunal also relied on the decision of the co-ordinate Benches of the Tribunal in the case of Cosmo Films Ltd. wherein it is held that the additional depreciation allowed under section 32(1)(iia) is a one-time benefit to encourage industrialisation and the relevant provisions has been construed reasonably and purposive. Being aggrieved by the order passed by the Tribunal, the appellants herein have presented this appeal.

We have heard the learned counsel for the appellants.

During the course of submission, the learned counsel appearing for appellants submitted that the subject matter involved in this case is directly covered by the judgment passed by the Division Bench of this court dated November 24, 2015, in I.T.A. No. 268 of 2014 (CIT v. Rittal India Pvt. Ltd. (No. 1) , [2016] 380 ITR 423 (Kam)). Therefore, he submitted that following the said judgment and for the reasons stated therein, this appeal may also be disposed of.

The above submission made by learned counsel appearing for appellants is placed on record. Following the judgment of the Division Bench of this court dated November 24, 2015, in I.T.A. No. 268 of 2014 CIT v. Rittal India Pvt. Ltd. (No. 1) , [2016] 380 ITR 423 (Kam)) and for the reasons stated therein, we do not find that any interference is called for in the order of the Tribunal or that any question of law arises in this appeal for consideration by this court. Accordingly, the appeal filed by the appellant is dismissed.