Can AO include roads under the definition of Building for depreciation purposes even though the appellant has rights in the developed Toll Road?

IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI “A” BENCH: NEW DELHI
(THROUGH VIDEO CONFERENCING)

BEFORE SHRI G.S. PANNU, VICE PRESIDENT AND
SHRI KUL BHARAT, JUDICIAL MEMBER

ITA Nos.1592 & 1593/Del/2017
Assessment Years : 2012-13 & 2013-14

BSC C&C Kurali Toll Road Ltd.,
74, Hemkunt Colony,
New Delhi-110048.
PAN-AADCB1505H
APPELLANT 

Vs

DCIT,
Circle-5(1),
New Delhi.
RESPONDENT

Appellant by Sh. Amarjeet Singh, CA.
Respondent by Sh. Satpal Gulati, CIT DR

Date of Hearing 30.03.2021
Date of Pronouncement 18.05.2021

ORDER

PER KUL BHARAT, JM :

 Both appeals filed by the assessee for the assessment years 2012-13 & 2013-14 are directed against the order of learned CIT(A)-35, New Delhi both dated 02.02.2017.

2. Both appeals were taken up together and being disposed of by way of a consolidated order. First we take up ITA No.1592/Del/2017 relating to Assessment Year 2012-13 wherein the assessee has raised following grounds of appeal:-

1. “That on the facts and circumstances of the case and in law, the Learned CIT (Appeals) has erred while confirming the reduction of depreciation on Toll Road developed by the appellant company from 25% to 10% and confirming addition of Rs.70,58,54,074/-  (including addition made as Ground of Appeal No.-2) on the ground that the roads are included in the definition of Building without accepting appellant’s contention that the appellant company has Rights in the developed Toll Road and the appellant is eligible for depreciation @ 25% under the head Intangible Assets.

2. That on the facts and circumstances of the case and in law, the Learned CIT (Appeals) has erred while confirming deduction of Grant of Rs.43.92 Crores received from NHAI out of the total cost of project of Rs.441,27,05,614/- on the ground that the grant given by NHAI is to meet part of the cost of the project and is not a contribution towards the Equity Support.

3. That on the facts and circumstances of the case and in law, the Learned CIT (Appeals) has erred while confirming disallowance of provision made for major maintenance expenses amounting to Rs.3,00,00,000/- on the ground that the said provision is contingent in nature and the assessee has not made any expenditure on that count during the year under consideration and such a maintenance envisaged in the Common Rupee Loan Agreement at best is merely an estimate, indefinite, likely to take place at some future date and the same has not taken place at all. 

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