M/s. Sri Balaji Sago & Starch Products, Namakkal V. ITO, Salem

CO 20/CHNY/2011

• Counselvise Citation: [2012] 122 COUNSELVISE.COM (IT) 6950 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 1 month(s) 11 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 08-03-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 08-03-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 27-01-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M NARAYANAN
• Assessee Lawyers: K E B RENGARAJAN JUNIOR
• Keywords: Depreciation; Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER ITA NO. 2081/(MDS)/2010 ASSESSMENT YEAR : 2007-08 AND C.O.NO. 20/MDS/2011 THE INCOME-TAX OFFICER, WARD-II(2), NO.3, GANDHI ROAD, SALEM-7. VS. M/S. SRI BALAJI SAGO AND STARCH PRODUCTS, ODUVANAKURIC HI PO, RASIPURAM TK., NAMAKKAL 637 406. PAN AAWFS 2619 D (APPELLANT) (RESPONDENT/CROSS OBJECTOR) APPELLANT BY : SHRI KEB RENGARAJAN, JUNIOR STANDING COUNSEL RESPONDENT BY : SHRI M.NARAYA NAN DATE OF HEARING : 8 TH MARCH, 2012 DATE OF PRONOUNCEMENT : 8 TH MARCH, 2012 O R D E R PER DR.O.K.NARAYANAN, VICE-PRESIDENT: THE APPEAL IS FILED BY THE REVENUE. THE CROSS OBJ ECTION IS FILED BY THE ASSESSEE. THE RELEVANT ASSESSMENT YE AR IS 2007-08. ITA 2081/10 & CO 20/11 :- 2 -: THE APPEAL AND THE CROSS OBJECTION ARE DIRECTED AG AINST THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX(APPEALS) AT SALEM ON 20.09.2010 AND ARISE OUT OF THE ASSESSMENT COMPLETE D UNDER SEC.143(3) OF THE INCOME-TAX ACT, 1961. 2. THE ASSESSEE HAD INSTALLED A WINDMILL IN MARUT HUR VILLAGE OF THARAPURAM TALUK IN THE LATER HALF OF THE PREVIOUS YEAR 2005-06. THE FIRST ASSESSMENT YEAR FOR CLAIMING DEPRECIATION ON WINDMILL WAS ASSESSMENT YEAR 2006-07. THE ASSESSEE CLAIMED DEPR ECIATION ON WRITTEN DOWN VALUE (WDV) BASIS. THE RATE APPLIED W AS 15% AND THE QUANTUM DEDUCTION CLAIMED WAS HALF OF THE AMOUNT, A S THE ASSET WAS PUT TO USE FOR A PERIOD OF LESS THAN 180 DAYS. FOLLOWING THE EARLIER COURSE OF ACTION FOR THE ASSESSMENT YEAR 20 06-07, THE ASSESSEE CLAIMED THE DEPRECIATION FOR THE IMPUGNED ASSESSMENT YEAR AS WELL ON WDV BASIS. THE RATE ADOPTED IN COM PUTING THE INCOME REFLECTED IN THE RETURN WAS 15%. BUT LATER, THE ASSESSEE FOUND THAT THE RATE OF 15% CLAIMED BY THE ASSESSEE WAS NOT THE CORRECT RATE PRESCRIBED IN THE RULES. THE ASSESSEE , THEREFORE, FILED A LETTER BEFORE THE ASSESSING AUTHORITY TO RECTIFY TH E RATE OF DEPRECIATION AND APPLY THE PRESCRIBED RATE OF 80%. THE ASSESSIN G OFFICER REJECTED THE SUBSEQUENT CLAIM MADE BY THE ASSESSEE IN THE COURSE ITA 2081/10 & CO 20/11 :- 3 -: OF ASSESSMENT ON THE GROUND THAT THE ASSESSEE HAD N OT IN FACT, EXERCISED ITS OPTION TO CLAIM DEPRECIATION EITHER O N WDV METHOD OR ON STRAIGHT-LINE METHOD AND SO ALSO HAS NOT APPLIED THE CORRECT RATE OF DEPRECIATION PROVIDED IN THE RULES. THE PRAYER FOR RECTIFICATION IN ADOPTING THE CORRECT RATE OF DEPRECIATION WAS NOT A CTED UPON BY THE ASSESSING AUTHORITY. 3. THE RULE PROVIDES AN OPTION TO THE ASSESSEE TO CLAIM DEPRECIATION ON WINDMILL EITHER ON WDV METHOD OR ON STRAIGHT-LINE METHOD . 4. IN FIRST APPEAL, THE COMMISSIONER OF INCOME-T AX(APPEALS) OBSERVED THAT THE RELEVANT RULE DOES NOT SPECIFY TH AT THE OPTION HAS TO BE EXERCISED BY THE ASSESSEE BY FILING A SEPARAT E FORMAT BEFORE THE ASSESSING AUTHORITY. THE OPTION HAS TO BE EXER CISED BEFORE DUE DATE OF FILING OF THE RETURN. THE COMMISSIONER OF INCOME- TAX(APPEALS) FOUND THAT THE ASSESSEE HAD FILED ITS RETURN OF INCOME BEFORE DUE DATE IN WHICH THE INCOME WAS COMPUTED ON THE BASIS OF CLAIMING DEPRECIATION ON WDV METHOD. THE RATE APPL IED BY THE ASSESSEE ALONE WAS INCORRECT. INSTEAD OF 80%, THE ASSESSEE HAD CLAIMED 15%. APART FROM THIS MISTAKE IN THE RATE O F DEPRECIATION, ITA 2081/10 & CO 20/11 :- 4 -: THERE IS NO CASE AGAINST THE ASSESSEE THAT IT HAS N OT EXERCISED THE OPTION OF CHOOSING BETWEEN WDV METHOD AND STRAIGHT- LINE METHOD. REGARDING THE CORRECT RATE OF DEPRECIATION, THE COM MISSIONER OF INCOME-TAX(APPEALS) HELD THAT AS THE PRAYER WAS ONL Y TO APPLY THE CORRECT RATE OF DEPRECIATION, THE SAME HAS TO BE AC CEPTED. ACCORDINGLY, THE COMMISSIONER OF INCOME-TAX(APPEALS ) ADJUDICATED THE MATTER IN FAVOUR OF THE ASSESSEE BY GIVING A DI RECTION TO THE ASSESSING OFFICER TO GRANT THE ASSESSEE DEPRECIATIO N AT THE RATE OF 80% ON WDV METHOD. 5. THE REVENUE IS AGGRIEVED, AND, THEREFORE, THE SE COND APPEAL BEFORE US. 6. THE RELEVANT GROUNDS RAISED BY THE REVENUE ARE E XTRACTED BELOW : 2. THE CIT(A) HAS FAILED TO APPRECIATE THE FACT T HAT NEITHER FOR THE CURRENT ASSESSMENT YEAR 2007-08, NOR FOR T HE EARLIER ASSESSMENT YEAR 2006-07 IN WHICH THE WINDMI LL IN QUESTION HAD BEEN INSTALLED, THE ASSESSEE HAD EXERC ISED THE OPTION, IN SOME WAY OR OTHER, TO INDICATE THAT THEY WANTED THE BENEFIT OF WDV RATE OF DEPRECIATION AND NOT UNDER THE STRAIGHT LINE METHOD. ITA 2081/10 & CO 20/11 :- 5 -: 3. THE CIT(A) HAS ERRED IN STATING IN PAGE NO.11, PARA 8 OF HIS ORDER THAT THE APPELLANT HAS CLAIMED WRONG RATE OF DEPRECIATION AND IN THE RETURN FILED FOR THE A.Y. 2 007-08 RECTIFIED THE MISTAKE OF RATE OF DEPRECIATION. I T IS NOT CORRECT THAT THE ASSESSEE RECTIFIED THE MISTAKE OF RATE OF DEPRECIATION IN THE RETURN. THE CORRECT FACT IS TH AT DURING THE ASSESSMENT PROCEEDINGS ASSESSEE FILED MERELY A LETTER RECTIFYING THE SAID MISTAKE. 4. THE INCOME-TAX ACT, 1961 OR THE INCOME-TAX RULE S, 1962 DO NOT LAY DOWN ANY PRESCRIBED FORMAT FOR EXER CISING THE OPTION IN QUESTION, NOR IS THERE ANY STIPULATIO N THAT THEY HAVE TO BE FILED IN ANY PARTICULAR MANNER. HOWEVER THE LAW CLEARLY SAYS THAT SUCH OPTION SHOULD BE FILED WITHI N THE DUE DATE FOR FILING THE RETURN OF INCOME CONTEMPLATED U /S.139(1). THE LAW ATTACHES SANCTITY TO THE OPTION BEING EXERC ISED WITHIN THE DUE DATE FOR FILING THE RETURN OF INCOME AND NOT AT ANY POINT OF TIME. CERTAIN BENEFITS CONTEMPLATED B Y THE STATUE ARE LINKED TO THE RETURN OF INCOME BEING FIL ED WITHIN THE DUE DATE LAID DOWN IN SECTION 139(1) [LIKE THE TAX HOLIDAY BENEFITS CONTEMPLATED BY SECTION 80-I, 80-I A ETC.] OR THE OPTION BEING EXERCISED BEFORE THE DUE DATE LAI D DOWN IN SECTION 139(1), LIKE THE BENEFIT CURRENTLY AGITA TED UPON. IN THIS CASE THE REVISED CLAIM OF THE ASSESSEE WA S MADE FOR THE FIRST TIME ON 13-11-2009, WHICH IS WELL AFT ER THE DUE DATE. ITA 2081/10 & CO 20/11 :- 6 -: 5. THE ASSESSING OFFICER HAD CLEARLY OPINED THAT T HE RATIO OF THE DECISION OF THE HONBLE APEX COURT IN THE CA SE OF SHELLY PRODUCTS 261 ITR 367 IS NOT APPLICABLE TO TH E FACTS OF THE ASSESSEES CASE (IN PAGE 6 OF THE ASSESSMENT ORDER). THIS WAS NOT ACCEPTED BY THE CIT(APPEALS). THE FACTS IN THE CASE OF SHELLY PRODUCTS (SUPRA) WERE T OTALLY DIFFERENT AND A PARAGRAPH IN THE JUDGMENT CANNOT BE QUOTED IN ISOLATION, TO EMPHASIZE A POINT IN ANOTHE R CASE WHOSE FACTS ARE TOTALLY DIFFERENT. IN THE CASE OF CIT VS. SUN ENGINEERING WORKS LTD. 198 ITR 297(SC) HAS FROWNED UPON SUCH AN APPROACH, STATING CLEARLY THAT A JUDGM ENT IS BEING RENDERED ON THE FACTS AND CIRCUMSTANCES, AS APPLICABLE TO THE SAID CASE. A PARA OR SENTENCE IN A JUDGMENT IS NOT BE QUOTED IN SUPPORT OF A CONCLUSIO N. REFERENCE MAY BE MADE TO PARA 25 OF THE SAID JUDGME NT, WHEREIN THEIR LORDSHIPS HAVE REFERRED TO THEIR EARL IER DECISION REPORTED IN AIR 1971 (SC) 530. 6. THE FOLLOWING ASPECTS DESERVE ATTENTION : (I) THE REVISED CLAIM WAS MADE THROUGH A MERE LETT ER AND NOT REVISED RETURN; (II) AS ASSESSE CANNOT MAKE A REVISED CLAIM FOR THE EARLIER ASSESSMENT YEAR IN THE CURRENT YEAR; (III) THIS LETTER WAS FILED WELL AFTER THE DUE DAT E FOR FILING THE RETURN. ITA 2081/10 & CO 20/11 :- 7 -: 7. THE COMMISSIONER OF INCOME-TAX(APPEALS) OUGHT T O HAVE CONSIDERED THAT THE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT 284 ITR 323, ON THE ISS UE WHETHER THE APPELLANT COULD MAKE A CLAIM FOR DEDUC TION OTHER THAN BY FILING A REVISED RETURN?. IT HAS BE EN HELD THAT THERE WAS NO PROVISION UNDER THE INCOME-TAX ACT TO MAKE AMENDMENT IN THE RETURN OF INCOME BY MODIFYING AN APPLICATION AT THE ASSESSMENT STAGE WITHOUT REVISIN G THE RETURN. IN THIS CASE THE ASSESSEE HAS NOT MADE AN Y CLAIM BY WAY OF REVISED RETURN. 7. THE GROUNDS IN THE CROSS OBJECTION FILED BY THE ASSESSEE IN FACT, DO SUPPORT THE ORDER OF THE COMMISSIONER OF I NCOME- TAX(APPEALS) AND THE ULTIMATE PRAYER WAS ONLY TO DI SMISS THE APPEAL PREFERRED BY THE REVENUE. 8. SHRI KEB RENGARAJAN, THE LEARNED STANDING COUNSE L APPEARING FOR THE REVENUE CONTENDED THAT EVEN IF NO FORMAT IS PRESCRIBED FOR EXERCISING THE OPTION OF CHOOSING TH E METHOD OF DEPRECIATION AVAILABLE ON THE WINDMILL, IT IS INCUM BENT UPON THE ASSESSEE TO DEMONSTRATE THAT THE ASSESSEE HAS OPTED FOR A PARTICULAR METHOD WHICH SHOULD BE COMMUNICATED BEFO RE DUE DATE OF FILING OF THE RETURN. IN THE PRESENT CASE, AS THE ASSESSEE HAD CLAIMED DEPRECIATION FOR THE EARLIER ASSESSMENT YEA R ON STRAIGHT-LINE ITA 2081/10 & CO 20/11 :- 8 -: METHOD, THE SAME METHOD AND RATE WERE FOLLOWED FOR THE SUBSEQUENT IMPUGNED ASSESSMENT YEAR AND IN SUCH CIR CUMSTANCES, IT IS VERY EVIDENT THAT THE ASSESSEE HAS OPTED FOR STRAIGHT-LINE METHOD. THEREFORE, THE ASSESSING AUTHORITY IS JUST IFIED IN FOLLOWING THE STRAIGHT-LINE METHOD, OPTED FOR BY THE ASSESSEE IN A CONSISTENT MANNER, AS THE LAW PROVIDES THAT ONCE A METHOD IS C HOSEN, THE SAME HAS TO BE FOLLOWED FOR ALL THE ASSESSMENT YEAR S TO COME. 9. THE LEARNED STANDING COUNSEL FURTHER ARGUED, IN THE ALTERNATIVE, THAT A CLAIM OF DEDUCTION CANNOT BE MA DE BY THE ASSESSEE IN THE COURSE OF ASSESSMENT BY FILING A LE TTER. THE PROVIDED COURSE OF ACTION IS TO FILE A REVISED RETU RN OF INCOME AS HELD BY THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. V. CIT (284 ITR 323). 10. THE LEARNED STANDING COUNSEL FURTHER CONTEND ED THAT BOTH ON MERIT ON THE QUESTION OF OPTING THE METHOD OF DE PRECIATION AND ALSO ON THE QUESTION OF JURISDICTION ON CONSIDERING A CLAIM IN THE COURSE OF ASSESSMENT IN THE ABSENCE OF A REVISED RE TURN, THE ASSESSEE HAS NO CASE AND THE COMMISSIONER OF INCOME - TAX(APPEALS) HAS GROSSLY ERRED IN SETTING ASIDE THE ORDER OF THE ITA 2081/10 & CO 20/11 :- 9 -: ASSESSING AUTHORITY ON THIS POINT AND IN ALLOWING T HE APPEAL FILED BY THE ASSESSEE. 11. SHRI M. NARAYANAN, THE LEARNED AUTHORIZED RE PRESENTATIVE APPEARING FOR THE ASSESSEE, ON THE OTHER HAND, EXPL AINED THAT THE WINDMILL WAS COMMISSIONED IN THE SECOND HALF OF THE PREVIOUS YEAR, RELEVANT TO THE ASSESSMENT YEAR 2006-07 AND THUS, T HE ASSESSMENT YEAR 2006-07 WAS THE FIRST YEAR IN WHICH THE ASSESS EE HAD CLAIMED DEPRECIATION ON WINDMILL. THEREFORE, THE QUANTUM O F DEPRECIATION, WHETHER UNDER STRAIGHT-LINE METHOD OR UNDER WDV MET HOD, WILL BE THE SAME FOR THE ASSESSMENT YEAR 2006-07, AS IT WAS THE FIRST ASSESSMENT YEAR IN RESPECT OF DEPRECIATION. THE M ISTAKE COMMITTED FOR THE ASSESSMENT YEAR 2006-07 WAS ONLY IN RESPECT OF ADOPTING THE RATE OF DEPRECIATION. THE ASSESSEE HA D CLAIMED DEPRECIATION AT 15% INSTEAD OF 80%. THERE IS NO OT HER INDICATION TO HOLD THAT THE ASSESSEE HAD OPTED FOR STRAIGHT-LINE METHOD. 12. THE LEARNED AUTHORIZED REPRESENTATIVE FURTHER EXPLAINED THAT THE TEST OF OPTING FOR A PARTICULAR METHOD IS CLEAR LY DISCERNIBLE FROM THE IMPUGNED ASSESSMENT YEAR 2007-08 WHICH IS THE SECOND YEAR OF ASSESSMENT AS FAR AS THE QUESTION OF DEPREC IATION ON ITA 2081/10 & CO 20/11 :- 10 -: WINDMILL IS CONCERNED. IT IS CATEGORICALLY FOUND THAT THE ASSESSEE HAD CLAIMED DEPRECIATION ON WDV BROUGHT DOWN FROM T HE EARLIER ASSESSMENT YEAR. THUS, IF THE CLAIM MADE FOR BOTH THE ASSESSMENT YEARS PUT TOGETHER, IT IS CLEAR THAT THE ASSESSEE H AS OPTED FOR DEPRECIATION ON WDV METHOD. 13. REGARDING THE CORRECT RATE OF DEPRECIATION, THE LEARNED AUTHORIZED REPRESENTATIVE SUBMITTED THAT THE ASSESS EE HAS NOT MADE ANY CLAIM FOR ANY FRESH DEDUCTION IN THE COURSE OF ASSESSMENT PROCEEDINGS. THE ASSESSEE HAS ALREADY MADE ITS CLA IM FOR THE STATUTORY ALLOWANCE OF DEPRECIATION, BUT, THE ASSES SEE APPLIED INCORRECT RATE. BY POINTING OUT THE CORRECT RATE O F DEPRECIATION, THE ASSESSEE WAS IN FACT, REQUESTING THE ASSESSING OFFI CER TO RECTIFY A MISTAKE APPARENT ON RECORD AND THE ASSESSEE WAS NOT PRAYING FOR ANY DEDUCTION FOR THE FIRST TIME. 14. HE, THEREFORE, SUBMITTED THAT THE COMMISSION ER OF INCOME- TAX(APPEALS) IS RIGHT IN GIVING DIRECTION TO THE AS SESSING OFFICER TO GRANT DEPRECIATION ON WDV AT THE APPROPRIATE RATE O F 80%. 15. HE HAS ALSO RELIED ON THE DECISION OF THE HO NBLE PUNJAB & HARYANA HIGH COURT RENDERED IN THE CASE OF CIT V. R AMCO ITA 2081/10 & CO 20/11 :- 11 -: INTERNATIONAL (332 ITR 306); THE DECISION OF THE HO NBLE GUJARAT HIGH COURT IN THE CASE OF CHOKSHI METAL REFINERY V. CIT (107 ITR 63) AND THE DECISION OF THE ITAT, CHENNAI BENCH D IN THE CASE OF K.K.S.K. LEATHER PROCESSORS (P) LTD. V. ITO (126 ITD 215). 16. WE HEARD BOTH SIDES AND CONSIDERED THE MATTER I N DETAIL. 17. THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS EXAMINED IN DETAIL THE SEQUENCES OF FURNISHING OF REPORTS AN D PARTICULARS BY THE ASSESSEE ALONG WITH THE RETURN OF INCOME TO COME TO A FACTUAL FINDING THAT THE ASSESSEE HAD IN FACT, OPTED FOR CHOOSING T HE CLAIM OF DEPRECIATION ON WDV METHOD. THE IMPUGNED ASSESSMEN T YEAR BEING THE SECOND ASSESSMENT YEAR FOR CLAIMING DEPRE CIATION ON THE WINDMILL, THE VALUE ON WHICH THE ASSESSEE HAD CLAIM ED DEPRECIATION IS AN APPARENT TESTIMONY TO SHOW THAT WHAT IS THE C OURSE OF ACTION OPTED FOR BY THE ASSESSEE. IN THE IMMEDIATELY PREC EDING ASSESSMENT YEAR, THE CLAIM OF DEPRECIATION WAS FOR THE FIRST YEAR, THE DEPRECIATION WAS CLAIMED ON THE ORIGINAL COST E VEN THOUGH AT A WRONG RATE. IN THE IMPUGNED ASSESSMENT YEAR, THE DEPRECIATION WAS CLAIMED AGAIN AT WRONG RATE BUT ON WDV METHOD. THEREFORE, IT IS VERY CLEAR THAT THE ASSESSEE HAS EXERCISED ITS O PTION FOR CHOOSING THE METHOD OF PROVIDING FOR DEPRECIATION AS PRESCRI BED IN THE STATUTE. ITA 2081/10 & CO 20/11 :- 12 -: WE AGREE WITH THE FACTUAL FINDING OF THE COMMISSION ER OF INCOME- TAX(APPEALS) ON THIS POINT. 18. REGARDING THE QUESTION, WHETHER A CLAIM MADE BY THE ASSESSEE IN THE COURSE OF ASSESSMENT PROCEEDINGS BY WAY OF OTHER THAN FILING A REVISED RETURN, WE HAVE TO STATE THAT EXACTLY SIMILAR ISSUE WAS CONSIDERED BY THE PUNJAB & HARYANA HIGH C OURT IN THE CASE OF CIT V. RAMCO INTERNATIONAL (332 ITR 306). IN THAT CASE, THE ASSESSEE HAD CLAIMED DEDUCTION UNDER SEC.80IB. THO UGH THE ASSESSEE HAD FURNISHED FORM 10CCB AND OTHER REQUISI TE DOCUMENTS, THE ASSESSING OFFICER MADE THE ASSESSMEN T WITHOUT REFERRING TO THOSE DOCUMENTS. IN FIRST APPEAL, THE COMMISSIONER OF INCOME-TAX(APPEALS) ALLOWED THE CLAIM OF THE ASSESS EE WHICH WAS THE SECOND APPEAL BEFORE THE TRIBUNAL. WHEN THE MA TTER WAS AGAIN TAKEN BEFORE THE HONBLE HIGH COURT, THEIR LORD-SHI PS HELD THAT AS PER FORM 10CCB FILED BY THE ASSESSEE IN THE ASSESSM ENT PROCEEDINGS, THE CLAIM OF DEDUCTION MADE BY THE ASS ESSEE WAS ADMISSIBLE. THE COURT HELD THAT THE ASSESSEE WAS N OT MAKING ANY FRESH CLAIM AND HAD DULY FURNISHED AND SUBMITTED T HE FORM FOR CLAIMING DEDUCTION UNDER SEC.80IB AND IN SUCH CIRCU MSTANCES, THERE WAS NO REQUIREMENT OF FILING ANY REVISED RETURN. I N THE PRESENT CASE ITA 2081/10 & CO 20/11 :- 13 -: ALSO, THE ASSESSEE HAS MADE A CLAIM FOR DEPRECIATIO N ON WDV METHOD BUT THE RATE CHOSEN WAS NOT A CORRECT ONE. THE ASSESSEE ASKED FOR ADOPTING THE CORRECT RATE WHICH IS IN FAC T, WAS ONLY A PRAYER TO RECTIFY A MISTAKE APPARENT ON RECORD. THE ASSES SEE WAS NOT CLAIMING ANY FRESH CLAIM BEFORE THE ASSESSING AUTHO RITY. THEREFORE, THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CA SE OF GOETZE (INDIA) LTD. V. CIT (284 ITR 323) DOES NOT APPLY TO THE PRESENT CASE. 19. THE ABOVE POSITION IS FORTIFIED BY THE ORDER OF THE ITAT, CHENNAI BENCH D RENDERED IN THE CASE OF K.K.S.K. LEATHER PROCESSORS (P.) LTD. (126 ITD 215). THE TRIBUNAL, AFTER EXAMINING THE EXPLANATION 5 TO SUB-SEC.(1) OF SEC.32, HELD TH AT THE PROVISIONS OF SUB-SEC.(1) OF SEC.32 WAS APPLIED WHETHER OR NOT TH E ASSESSEE HAS CLAIMED THE DEDUCTION IN RESPECT OF DEPRECIATION IN COMPUTING HIS TOTAL INCOME. THE TRIBUNAL HELD THAT THE ASSESSING OFFICER IS DUTY BOUND AND UNDER OBLIGATION TO ALLOW THE DEDUCTION O F DEPRECIATION AS PER THE PROVISIONS OF SEC.32(1). WHEN SUCH A STAT UTORY OBLIGATION IS CAST ON THE ASSESSING AUTHORITY, IT IS INCUMBENT ON HIM TO APPLY THE CORRECT RATE OF DEPRECIATION, ESPECIALLY IN THE PRE SENT CASE WHERE THE OPTION EXERCISED BY THE ASSESSEE IS MANIFESTLY CLEA R. ITA 2081/10 & CO 20/11 :- 14 -: 20. IN THE PRESENT CASE, THE ASSESSEE HAS NOT MADE ANY FRESH CLAIM, AS FAR AS DEPRECIATION IS CONCERNED. IT HAS ALREADY MADE A CLAIM FOR STATUTORY ALLOWANCE OF DEPRECIATION, SUBJ ECT TO THE MISTAKE OCCURRED IN CHOOSING THE CORRECT RATE. THE RATIO O F THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (IN DIA) LTD. V. CIT (284 ITR 323) NEEDS TO BE CAREFULLY APPLIED IN THE MATTERS OF STATUTORY ALLOWANCES AVAILABLE TO AN ASSESSEE. THE RE IS A GENETIC DIFFERENCE IN THE CONCEPT OF DEDUCTION BY WAY OF ST ATUTORY ALLOWANCE AND DEDUCTION BY WAY OF OTHER EXPENDITURE. 21. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, W E FIND THAT THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX(APPE ALS) IS SUSTAINABLE IN LAW AND THE APPEAL FILED BY THE REVE NUE IS LIABLE TO BE DISMISSED. 22. SO MUCH SO, THE CROSS OBJECTION FILED BY THE AS SESSEE HAS BECOME INFRUCTUOUS AND LIABLE TO BE DISMISSED IN LIMINE. THERE IS A DELAY OF 5 DAYS IN FILING THE CROSS OBJECTION. FOR THE PURPOSE OF CONSIDERING THE CROSS OBJECTION, THE DELAY IS EXCUS ED AND THE CROSS OBJECTION IS ADMITTED BUT THE SAME IS DISMISSED AS INFRUCTUOUS. ITA 2081/10 & CO 20/11 :- 15 -: 23. IN RESULT, THE APPEAL FILED BY THE REVENUE AS W ELL AS THE CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON THURSDAY, THE 8 TH OF MARCH, 2012 AT CHENNAI. SD/- SD/- (VIKAS AWASTHY) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 8 TH MARCH, 2012. MPO* COPY TO: (1) PETITIONE R (2) RESPONDENT (3) CIT (4) CIT(A) (5) D.R. (6) G.F.