As per the General Clauses Act, 1897, if a particular word is not defined in the Central statute then meaning given to such expression under General Clauses Act, However, if it falls within the definition of Mobile Phone then lower rate of depreciation is allowable.īut the problem arises that the term computer has not been defined in the Income Tax Act. If iPad Falls in The Definition of Computer, then High Rate of Depreciation is allowable. In the present case ITAT was to adjudicate whether the iPad falls in the definition of computer or mobile phone. iPad is basically a small/ tablet computer and depreciation applicable to a computer is to be allowed for an iPad/tablet. The facts of the case are that the assessee had purchased an apple iPad during the year. Depreciation on apple I Pad was rightly claimed by treating it as computer. Assessee argued that CIT-A has erred in upholding the action of the Assessing Officer in restricting the deprecation on apple I Pad at general rate of 15% (further restricted to 7.5% on the basis of date of purchase). Aggrieved with this Assessee approached CIT (Commissioner of Income tax) – Appeals but CIT-A also restricted the depreciation on Apple Ipad at general rate of 15% (further restricted to 7.5% on the basis of date of purchase).Īssessee approached Amrtisar – ITA against the order of CIT-A. Department rejected the claim and allowed depreciation on “IPAD” considering them Plant & Machinery at 15%. 234 & 316/Asr/2017), In this case, Assessee claim depreciation on “IPAD” at the rate of 60% by treating is as computer. Assistant Commissioner of Income Tax -Amrtisar ITAT (ITA No. ITAT ruled, “By very nature of mobile phone, this cannot be fixed to a particular place.” ITAT allowed depreciation without Place of Installation. Mobile in itself means “ able to move or be moved freely or easily.” As per Cambridge Dictionary Mobile means, “ moving or walking around freely.” The World Book Encyclopaedia also says, “ The Cellular (Mobile) Telephone is a movable telephone unit.” But, what to say about Income Tax Department who rejected Depreciation claim on Mobile Phones as place of Installation was not given.Īggrieved with the Revisionary Order, Assessee approached Mumbai-IAT which settled the case in favour of assessee. Vide para 18 of the Revision Order of the CIT was of the opinion that the assessee has not provided “the place of installation of assets”, which in this case was of mobile phone was not given and therefore the claim of depreciation was not allowable. In this case CIT (Commissioner of Income tax), disallowed depreciation on mobiles, as the assessee has not provided “the place of installation” of Mobile Phones. In this case, M/s Rangbahar an assessee, has challenged the validity of the proceedings initiated by the Commissioner of Income tax under section 263 in setting aside the order of the assessing officer under section 143(3). Commissioner of Income Tax – Mumbai- ITAT (ITA No. Here are some Case Laws under which some issues related to Mobile like its Location, Classification & rate of depreciation etc are discuss: So, let’s continue our discuss on this and know the view of our Income tax department and various authorities, on this issue. Even Income tax defined the term Business Expenditure also.īusiness are allowed to claim depreciation on fixed assets used for business purpose only, at a specific rate as provided by Income Tax Department, Now the question arise Does Mobile Comes Under the Category of Fixed Assets, and If Yes Then at What Rate? Only those expenditure which incurred on Business termed as Business Expenditure. Government and Income Tax Department allows us to reduced business expenditure from gross earning. In some sectors like communication and marketing. It is also using in various business as an essential tool. Nowadays usage of mobile increasing rapidly, does not matter about which industry we are talking, either educational field, entertainment source, or enhancing our business by providing an excellent source of networking. Mobile is emerging not only as an advance technology communicating device and entertaining source but also playing a vital role in the era of industrial revolution.
As we all are well acquainted with the wide usage of mobile.
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