Assessee company engaged in business of selling vacation ownership and providing holiday facilities. Scrutiny assessment u/s. 143(3) completed vide Order dated 28.12.2011. Case reopened u/s. 147 of the Act on the issue that assessee claimed depreciation @15% on electrical installations instead of 10% and claimed depreciation @25% on non-compete fees by treating the same as intangible asset. Assessee challenged that reassessment was initiated on the basis of ‘change of opinion’ and relied upon SC decision in the case of Kelvinator of India. However, CIT(A) dismissed the appeal by relying on the judgment of Jurisdictional Madras HC in the case of Mobis India and Cognizant Technology Solution, whereby Kelvinator has been distinguished. ITAT held reassessment, initiated within 4 years, to be valid as during original assessment, no specific query was raised and no specific find was given. Contention that reassessment was based on change of opinion is rejected.

Assessee claimed depreciation @15% on electrical installations. Tribunal held that  primarily AC, Refrigerator, Generator should be considered as Plant-eligible for depreciation @15%. ITAT, following the judgment of Hon’ble Madras High Court  in the case of Geetha Hotels P. Ltd v. CIT (2002) 254 ITR 649 (Mad)(HC), allowed claim of depreciation @15%. Assessee paid non-compete fees and claimed depreciation @25% by treating the same as intangible asset. AO disallowed depreciation. Disallowance upheld by CIT(A) by holding that non-compete fees not an intangible asset-not eligible for depreciation u/s. 32. ITAT reversed the finding of AO and CIT(A) and allowed claim of depreciation on non-compete fees. Disallowance u/s. 14A r.w.r. 8D-AO disallowed average of investment and included all the investments including investments in subsidiaries, from which, no exempt income (dividend) was earned, but strategic investments, for acquiring control in the subsidiary. Such investments were to be excluded for determining average investments as per Rule 8D. Assessee further contended that investment in mutual funds yielding dividend income exempt u/s. 10(35) was out of own funds and no borrowed funds were utilized. Matter set aside to AO since fund flow statement and other necessary details were required for verification.(AY. 2009-10 to 2015-16)