DCIT Vs NTT Global Data Centres Cloud Infrastructure India Pvt. Ltd. (ITAT Mumbai)
ITAT Mumbai held that alternative claim of assessee (lessee) to allow depreciation on Finance Lease Rental Payment is allowable since lessor is allowed deduction of the same under section 37(1) of the Income Tax Act.
Facts- The assessee is engaged in the business of providing remote infrastructure management, remote helpdesk, remote network monitoring services and other services for foreign customers. The present appeal has been preferred by the revenue. Notably, the only issue raised by the Revenue pertains to the deletion of disallowance on account of Finance Lease Rental Payment.
Conclusion- Held that the coordinate bench of the Tribunal in the assessee’s own case in NTT Global Data Centres and Cloud Infrastructure India Private Limited v/s NeAC, in ITA No. 2784/Mum./2023, for the assessment year 2015-16, vide order dated 07/02/2024, inter-alia, after considering the decision of the Hon’ble Karnataka High Court, wherein the claim of deduction of depreciation in case of lessor, i.e. Cisco Systems (India) Private Ltd, was allowed, accepted the main plea of the assessee and allowed the claim of deduction of Finance Lease Rental Payment under section 37(1) of the Act.
Held that since, considering the decision of the Hon’ble Karnataka High Court in lessor’s case, the claim of deduction of Finance Lease Rental Payment under section 37(1) of the Act has been allowed to the assessee by the coordinate bench for the year under consideration, the present appeal by the Revenue challenging the findings of the learned CIT(A) in allowing depreciation in the hands of the assessee has become infructuous and, therefore, is dismissed accordingly.
