COMMISSIONER OF INCOME TAX Vs. BHATIA GENERAL HOSPITAL

JUDGEMENT

(1.) This Appeal under Section 260-A of the Income Tax Act, 1961 (the Act), challenges the order dated 20th October, 2014 passed by the Income Tax Appellate Tribunal (the Tribunal). The impugned order dated 20th October, 2014 is in respect of Assessment Year 2007-08.

(2.) Revenue urges only the following re-framed question of law, for our consideration:

(3.) The Respondent is a charitable trust, running a hospital. During the course of assessment proceedings, the Assessing Office noticed that the Respondent had claimed additional depreciation of Rs. 815 lakhs in addition to the normal depreciation of Rs. 2.14 Crores. On an explanation being sought, the Respondent points out that the claim of additional depreciation has been made on the hospital equipments, which had completed its usefulness of 10 years, and this was claimed only for the purpose of writing off the value of the assets i.e. hospital equipments. However, the Assessing Officer held that in case where the asset i.e. hospital equipment has outlived its useful life, then the same should be sold as scrap and in the absence of such evidence, the claim of additional depreciation of Rs. 815 lakhs was disallowed. This resulted in addition of the above amount of Rs. 815 lakhs while determining the income in Assessment Order dated 18th December, 2009.