| Case ID |
e1374eb9-6173-44ce-8aa0-84342e6b15dd |
| Body |
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| Case Number |
I.T.A.T. No. 172 OF 2013 |
| Decision Date |
Feb 13, 2014 |
| Hearing Date |
Feb 13, 2014 |
| Decision |
The appeal was directed against a judgment and order dated June 19, 2013, by which the learned Tribunal held that the depreciation claimed in the accounts by the assessee was an outgoing for the purpose of determination of income in terms of section 11(1) of the Income-tax Act. The Tribunal directed the Assessing Officer to grant the assessee the benefit of depreciation in respect of the investment in fixed assets. The Revenue's appeal raised questions regarding the justification of allowing depreciation to a charitable organization, and whether it constituted double deduction. The court examined precedents and ultimately found that allowing depreciation is consistent with the commercial computation of income for charitable trusts. The appeal was dismissed, affirming the Tribunal's decision in favor of the assessee. |
| Summary |
The case revolves around the interpretation of the Income-tax Act, specifically regarding the applicability of depreciation for charitable organizations. The Calcutta High Court addressed whether a charitable trust could claim depreciation on assets that have already been fully accounted for as applications of income. The judgment emphasized the need for a commercial approach in computing income for charitable entities, thereby allowing for depreciation deductions. The court referred to previous rulings from the Punjab and Haryana and Bombay High Courts to support its conclusion. Ultimately, the court ruled in favor of the assessee, confirming that depreciation should be considered a legitimate deduction in the context of charitable trusts. This decision reinforces the importance of allowing such deductions to maintain the integrity of trust assets over time, ensuring they can continue to fulfill their charitable purposes. Keywords include 'Income-tax Act', 'charitable trust', 'depreciation', and 'commercial computation'. |
| Court |
Calcutta High Court
|
| Entities Involved |
Siliguri Regulated Market Committee
|
| Judges |
Girish Chandra Gupta,
Tapash Mookherjee
|
| Lawyers |
P.K. Bhowmick,
J.P. Khaitan,
Pradip Kumar Roy,
Debasish Kumar Kar,
Joydeep Roy
|
| Petitioners |
Commissioner of INCOME TAX
|
| Respondents |
Siliguri Regulated Market Committee
|
| Citations |
2014 SLD 2374,
(2014) 366 ITR 51
|
| Other Citations |
CIT v. Bheruka Public Welfare Trust [1999] 240 ITR 513/106 Taxman 311 (Cal),
CIT v. Market Committee, Pipli [2011] 330 ITR 16/[2012] 20 taxmann.com 559,
CIT v. Institute of Banking Personal Selection (IBPS) [2003] 264 ITR 110/131 Taxman 386 (Bom),
CIT v. Jayashree Charity Trust [1986] 159 ITR 280 (Cal),
CIT v. Munisuvarat Jain [1994] Tax LR 1084 (Bom),
Escorts Ltd. v. Union of India [1993] 199 ITR 43 (SC)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
11(1),
32
|