This is appeal filed by assessee and is directed against order dt. 27th March, 2003 passed by CIT(A) in matter of assessment under s. 143(3) of IT Act, 1961, for asst. yr. 2001-02. short grievance raised in this appeal, though crouched in lengthy and somewhat argumentative grounds of appeal, is against CIT(A) s declining depreciation in respect of machinery of Rs. 11,28,400 (and related capitalized expenses aggregating to Rs. 1,21,000) claimed to have been installed and put to use by assessee in relevant previous year. assessee appeared in person and made his efforts to explain aforesaid grievance and relevant facts of case. However, since assistance offered by assessee was inadequate and as assessee expressed his inability, on account of difficult financial position that he is said to be traversing through, to hire legal counsel to present his case, we requested Shri Prakash Jotwani, learned advocate who was present in Court room when this hearing was in progress, to assist us as amicus curiae. Shri Jotwani not only readily accepted our request but also ably assisted us. material facts of case are as follows. assessee is engaged in t h e business of manufacturing of packing boxes, such as leaflets and inner cartons, for certain pharmaceutical companies. In course of scrutiny assessment proceedings, AO made enquiries about purchases of second hand machinery by assessee. machinery was said to have been purchased from M/s City Art Printers, Delhi. However, letter under s. 133(6) issued by AO to said City Art Printers came back unserved. When assessee was confronted with this fact, assessee filed copies of bill, bank draft and evidences of octroi payment at time of transporting this machine in Mumbai. octroi receipt, however, showed value of machinery at Rs. 7,95,600. It was submitted by assessee that City Art Printers has since closed down business, and that is reason printing machine was sold to assessee, and are no longer in business at given address. AO thus concluded that value of machinery is to be taken at Rs. 7,95,600, as against Rs. 11,28,400 claimed by assessee. AO further noted that assessee has claimed capitalization of commission on purchases (Rs. 36,000), machinery installation (Rs. 24,000), transportation charges (Rs. 12,000), and octroi charges (Rs. 49,000). AO examined these expenses as well. AO was not satisfied with evidences of payment so far as commission on purchases and machinery installation was concerned. After making elaborate discussions about related facts, AO disallowed same. transportation charges were allowed to assessee as fact of machine having been brought to Mumbai was free from doubt. However, as regards octroi payment, AO only accepted claim of Rs. 35,802, on basis of actual payment, and not entire amount of Rs. 49,000 as claimed by assessee. value of machinery was thus recalculated by AO at Rs. 8,43,402 as against claim of Rs. 12,49,000. Even on this value, depreciation was disallowed by observing that "it is not clear from submissions of assessee that whether machinery is put to actual use or not". Aggrieved, assessee carried matter in appeal before CIT(A) but without any success. assessee is not satisfied and is in further appeal before us. We have heard learned amicus curiae as also learned Departmental Representative. We have also carefully perused material on record, including paper book filed by amicus curiae, and duly considered factual matrix of case as well as applicable legal position. We find that, as evident from copies of bank drafts through which payment for machinery was made, assessee paid for printing machinery on 26th Feb., 2001 and machine was sold to assessee vide invoice raised on immediately following day i.e. 27th Feb., 2001. As octroi receipt, copy of which is placed in paper book, shows, printing machine actually reached Mumbai on 2nd March, 2001. We have also taken look at photograph of machine, as filed by assessee, which shows that machine is in nature of standalone printing machine which does not really need much of preparatory installation work such as raised platforms etc. We have also noted that details of job work filed by assessee show that such job work charges were not paid in month of March, 2001. Bearing in mind all these facts, as also entirety of case, we see no reasons to reject assessee s claim for depreciation on printing machinery. authorities below, in our considered view, erred in rejecting claim of depreciation. We, therefore, uphold grievance of assessee and direct AO to allow proper depreciation on printing machinery purchased by assessee. However, as we do so, we must also address ourselves to question as to on what value of machinery is admissible. We have taken note of fact that as against assessee s claim of purchase price of Rs. 11,28,400, value of machinery is to be taken at Rs. 7,95,600 on basis of valuation for octroi. We are unable to approve this stand of authorities below. Simply because assessee pays octroi on basis of valuation of Rs. 7,95,600, value of purchases cannot be tinkered with. It could be case of underpayment of octroi charges or of taking different valuation for that purpose, but that fact, by itself, cannot be reason enough for AO to disallow purchases. Let us assume for minute that fair value was indeed Rs. 7,95,600, but even that assumption will not be of any consequence so far as computation of depreciation is concerned, which is on purchase price and not fair market value. To that extent, we reverse stand of AO and direct him to adopt basic value of machinery at Rs. 11,28,400. As regards disallowance out of capitalized expenses, and due to non-availability of relevant information readily, learned counsel for assessee could not make any specific submissions before us, save and except for submitting that whether or not recipient of payment has shown same in his books of accounts cannot govern allowability of expenses in hands of person making payment. We have noted that so far as installation charges are concerned, it was precisely this reason, as also some minor discrepancies in bills etc. for which disallowance was made. We, therefore, deem it fit and proper to delete disallowance of Rs. 24,000 on account of installation charges. remaining disallowance is confirmed for want of details. AO shall, in light of our above observations, recompute depreciable value of machinery, and grant depreciation thereon. assessee gets relief accordingly. appeal is allowed in terms indicated above. *** SAUMIL R. KADAKIA v. DEPUTY COMMISSIONER OF INCOME TAX