Ajit K.Sengupta J. - (1.) In this reference under Section 256(1) of the Income-tax Act, 1961, for the assessment years 1980-81 to 1982-83, the following question of law has been referred to this court : "Whether, on the facts and in the circumstances of the case, and having regard to the fact that the assessee carried on its business not at 85/85, Netaji Subhas Road, Calcutta, but at 23, Brabourne Road, Calcutta, the Tribunal was justified in directing the Income-tax Officer to allow depreciation in respect of capital expenditure incurred at 83/85, Netaji Subhas Road, Calcutta, under Section 32(1A) of the Income-tax Act, 1961 ?"
(2.) Shortly stated, the assessee derives income from leasehold property situated at Nos. 83 and 85, Netaji Subhas Road, Calcutta. The assessee renovated those premises and incurred capital expenses for this purpose. The assessee claimed depreciation on its capital expenditure under Section 32(1A) of the Income-tax Act, 1961. The Income-tax Officer refused to allow the claim on the ground that the assessee did not carry on any business from those premises Nos. 83 and 85, Netaji Subhas Road, Calcutta, where the capital expenditure was incurred but carried on business from premises No. 23, Brabourne Road, Calcutta and, therefore, the provisions of Section 32(1A) of the said Act were not applicable.
(3.) Being dissatisfied with the decision of the Income-tax Officer, the assessee preferred appeals before the Commissioner of Income-tax (Appeals). It was held by the Commissioner of Income-tax (Appeals) that the issue had already been decided by the Tribunal for the assessment year 1978-79. Following the said decision of the Tribunal, the appellate authority directed the Income-tax Officer to allow depreciation in accordance with law on the capital expenditure incurred for renovation of the leasehold premises.;