ITAT Upholds CIT(A)’s Order Allowing 50% Depreciation on CNC Lathe Used Prior to Detection of Defect

The Income Tax Appellate Tribunal (ITAT) upheld the Commissioner of Income Tax (Appeals) decision allowing 50% depreciation on a CNC lathe machine that was used before defects were discovered. The tribunal emphasized that the machinery was operational for business purposes prior to defect detection, making the assessee eligible for depreciation benefits. This ruling clarifies that subsequent defects don't invalidate legitimate depreciation claims for assets initially used in business operations. The judgment provides important guidance on tax treatment of depreciable assets that later require repairs or replacement.