JUDGEMENT
S.Grover, -
(1.)THE contention in this Revenue's appeal concerning assessment year 1981-82 is as follows:-
On the facts and in the circumstances of the case the learned AAC has erred in directing to find out the extent of unabsorbed depreciation allocated to the partners for the assessment year 1980-81 which could not be set off in the assessments of the partners and directing that the same should be carried forward and set off in assessment of the assessee firm for this year.
(2.)The respondent-assessee, a registered firm, constituted of two partners, namely, Shri Sardari Lal and Smt. Saroj Rani, purchased truck No. JKP-9971 for Rs. 1,89,288 as shown in the balance-sheet ending 31-3-1980. Apparently, the assessee did not claim depreciation on it and the relevant part pertaining to the details to be given under Section 32 of the Act in the return was left unfilled.
The ITO, however, computed depreciation on the said truck at the prescribed rate and allowed the same to the extent of Rs. 56,990 and after setting off the net profit as per profit and loss account to the extent of Rs. 3,480 allocated the unabsorbed depreciation of Rs. 53,508 amongst two partners.
(3.)FOR the assessment year under appeal, the vehicle having had been sold for Rs. 1,80,000, the ITO added profit of Rs. 57,690 under Section 41(2) of the Act to the declared income though no profit had been shown by the assessee on the ground that no depreciation had, been claimed in the earlier year.
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