UPS is an integral part of computer so depreciation should be charged accordingly

Last updated: 27 September 2012

Court :
INCOME TAX APPELLATE TRIBUNAL

Brief :
The facts concerning the only issue in dispute are that the assessee company is engaged in the business of pneumatic conveying systems. The company is located at Ambarnath, beyond Kalyan wherein there is frequent power failures making it impossible to carry on accounts, designs and other technical works dependent on computers. According to the assessee company use of UPS along with the computer was a necessity so as to obtain technical information uninterruptedly. UPS is like inverter so as to protect from sudden power failures by providing immediate power backup. Assessee claimed that the UPS has to be treated as an integral part of the computer and hence depreciation provided to the computer to be extended to the UPS also. The AO as well as the CIT(A) rejected the contention of the assessee. Hence assessee company is in appeal before us.

Citation :
Macawber Engineering System (I) Pvt. Ltd., 130-131 Hindustan Room No. 451, Kohinoor Complex, LBS Marg, M.K. Road, Mumbai 400020 Appellant Vs. ACIT, Circle 8-1 Aayakar Bhavan Vikhroli (W), Mumbai 400083 PAN - AAACM 4275 G Respondent