ACIT, Hyderabad V. Navayuga Engineering Co Ltd., Visakhapatnam

ITA 1053/HYD/2009

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 6332 (ITAT-HYDERABAD)
• Duration Of Justice: 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-10-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 25-05-2010
• Assessment Year: 2007-2008
• Appeal Filed On: 19-10-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V SRINIVAS
• Assessee Lawyers: V RAGHAVENDRA RAO
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI N.R.S.GANESAN AND SHRI AKBER BASHA ITA NO.1050/HYD/09 : A SSESSMENT YEAR 2003-04 ITA NO.1051/HYD/09 : A SSESSMENT YEAR 2004-05 ITA NO.1052/HYD/09 : A SSESSMENT YEAR 2005-06 ITA NO.1053/HYD/09 : A SSESSMENT YEAR 2006-07 ASST. COMMISSIONER OF INCOME- TAX CENTRAL CIRCLE I, HYDERABAD. V/S M/S. NAVAYUGA ENGINEERING CO. LTD., VISAKHAPATNAM ( PAN- AAACN 7396 R ) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI V.SRINIVAS RESPONDENT BY : SHRI V.RAGHAVENDRA RAO O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THESE FOUR APPEALS OF THE REVENUE ARE DIRECTED AGAIN ST THE ORDERS PASSED BY THE CIT(A) I, HYDERABAD DATED 14.8.200 9 FOR THE ASSESSMENT YEARS 2003-04 TO 2006-07. AS COMMON ISSUES ARE INVOLVED, WE HAVE HEARD THESE APPEALS TOGETHER AND WE PROCEED TO DISPOSE OF THE SAME BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE FIRST COMMON ISSUE THAT ARISES FOR CONSIDERATION I N THESE APPEALS IS REGARDING DEPRECIATION CLAIMED BY THE A SSESSEE ON A BRIDGE CONSTRUCTED BY IT UNDER BOT SCHEME APPROVED BY T HE GOVERNMENT OF ANDHRA PRADESH. ITA NO.1050-1053/HYD/09 M/S. NAVAYUGA ENGINEERING CO. LTD., VI SAKHAPATNAM 2 3. WE HAVE HEARD SHRI SRINIVAS, THE LEARNED DEPAR TMENTAL REPRESENTATIVE AND SHRI V.RAGHAENDRA RAO, THE LEARN ED COUNSEL FOR THE ASSESSEE. THE ASSESSING OFFICER HAS DENIED THE ASSESSEE'S CLA IM FOR DEPRECIATION ON THE BRIDGE CONSTRUCTED BY IT UNDER BOT SCHEME APPROVED BY THE GOVERNMENT OF ANDHRA PRADESH, ON THE GROUND THAT THE ASSESSEE IS NOT THE OWNER OF THE BRIDGE. ON APPEAL, THE CIT(A) AFTER ANALYZING THE AGREEMENT ENTERED INTO BY THE A SSESSEE WITH THE GOVERNMENT OF ANDHRA PRADESH AND FOLLOWING THE DECISI ON OF THE HYDERABAD BENCH OF THE TRIBUNAL DATED 5.6.2009 IN THE CASE OF NYSE INFRASTRUCTURE P. LTD. V/S. DCIT FOR ASSESSMENT YEAR 200 5-06 IN ITA NO.301 HYD/2009, HELD THAT THE ASSESSEE IS ENTITLED TO DE PRECIATION ON THE BRIDGE CONSTRUCTED BY IT UNDER BOT SCHEME, AND ACCORD INGLY DIRECTED THE ASSESSING OFFICER TO ALLOW THE SAME FOR ALL THESE YEARS. 4. ON CAREFUL CONSIDERATION, WE FIND THAT THE ISSUE O F ALLOWABILITY OF DEPRECIATION ON THE BRIDGE CONSTRUCTED BY THE ASSESSEE UNDER BOT SCHEME IS COVERED IN FAVOUR OF THE ASSESSEE BY T HE DECISION OF THIS TRIBUNAL IN THE CASE OF NYSE INFRASTRUCTURE P. L TD. (SUPRA). THIS POSITION IS NOT CONTROVERTED BY THE LEARNED DEPARTMEN TAL REPRESENTATIVE BEFORE US. IT HAS BEEN HELD BY THIS TRIBUNAL, VIDE ITS ORDER DATED 5.6.2009 THAT THE ASSESSEE IS THE OWNER OF THE ASSET CONSTRUCTED UNDER THE BOT SCHEME IN THAT CASE AND ACCORDINGL Y ENTITLED FOR DEPRECIATION THEREON. SINCE THE IMPUGNE D ORDERS OF THE CIT(A) ARE IN CONSONANCE WITH THE DECISION OF THE TRIBUN AL IN THAT CASE, IN THE ABSENCE OF ANY DECISION TO THE CONTRARY BROUGHT TO OUR NOTICE BY THE REVENUE, WE FIND NO INFIRMITY IN THE IMPUGNED O RDER OF THE CIT(A). WE ACCORDINGLY UPHOLD THE ORDERS OF THE CIT(A) ON THIS ASPECT AND REJECT THE GROUNDS OF THE REVENUE IN THESE APPEALS ON T HIS ISSUE. ITA NO.1050-1053/HYD/09 M/S. NAVAYUGA ENGINEERING CO. LTD., VI SAKHAPATNAM 3 5. THE NEXT COMMON ISSUE THAT ARISES FOR CONSIDERATION O NLY IN THE APPEALS FOR ASSESSMENT YEAR 2004-05 TO 2007-08 IS REGARDING DISALLOWANCE MADE BY THE ASSESSING OFFICER UNDER S.43B OF THE ACT WITH REGARD TO EMPLOYEES' CONTRIBUTION TO PROVIDENT F UND, WHICH HAS BEEN DELETED BY THE CIT(A). 6. WE HAVE HEARD SHRI SRINIVAS, THE LEARNED DEPAR TMENTAL REPRESENTATIVE AND SHRI V.RAGHAENDRA RAO, THE LEARN ED COUNSEL FOR THE ASSESSEE. THE ASSESSING OFFICER HAS DISALLOWED THE EMPLOY EES CONTRIBUTION TO PROVIDENT FUND FOR THE LAST MONTH OF THE PREVIOUS YEAR, VIZ. MARCH, ON THE GROUND THAT THE COMPANY FAILED T O REMIT THE SAME TO THE PF AUTHORITIES ON OR BEFORE 20TH APRIL OF THE SUCCEEDING FINANCIAL YEAR. THE CIT(A), FOLLOWING THE DECISION OF THE HON 'BLE KARANTAKA HIGH COURT IN THE CASE OF SABARI ENTERPRISES(298 ITR 141 ), WHEREIN IT WAS HELD THAT CONTRIBUTIONS MADE BY THE ASSESSEE TO THE PR OVIDENT FUND AND EMPLOYEE STATE INSURANCE WERE ALLOWABLE DEDUCT ION, EVEN THOUGH THEY WERE MADE BEYOND THE STIPULATED PERIOD A S CONTEMPLATED UNDER THE MANDATORY PROVISIONS OF S.36(1)(VA) READ WI TH S.2(24)(X) AND S.43B AS THE AMOUNTS WERE PAID BY THE ASSESSEE ON OR BEFORE THE DUE DATE FOR FURNISHING THE RETURN UNDER S.139(1) OF THE ACT. FOLLOWING THIS DECISION AND ALSO THE DECISION OF THE TRIBUNAL ( HYDE RABAD BENCH 'B ') IN THE CASE OF ELICO LTD. V/S. ITO(ITA NO.90/HYD/ 2004)(13 SOT 390), THE CIT(A) DELETED THE DISALLOWANCE UNDER S.43B MADE BY THE ASSESSING OFFICER FOR THESE YEARS. 7. ON CAREFUL CONSIDERATION, WE FIND THAT THE ISSUE O F ALLOWABILITY OF DEDUCTION IN RESPECT OF EMPLOYEES CONTRI BUTION TO PF, ITA NO.1050-1053/HYD/09 M/S. NAVAYUGA ENGINEERING CO. LTD., VI SAKHAPATNAM 4 NOT REMITTED TO THE PF AUTHORITIES BEFORE THE DATE ST IPULATED UNDER THE RELEVANT STATUTE, BUT BEFORE THE DATE FOR THE FILING OF THE RETURN UNDER S.139(1) OF THE ACT, IS COVERED IN FAVOUR OF THE ASSE SSEE BY THE DECISION OF THIS TRIBUNAL IN THE CASE OF ELICO LTD. V/S. ITO (SUPRA). THIS POSITION IS NOT CONTROVERTED BY THE LEARNED DEPARTMEN TAL REPRESENTATIVE BEFORE US. IT HAS BEEN HELD BY THIS T RIBUNAL IN THAT CASE, AFTER CONSIDERING THE DECISIONS OF THE HON'BLE SUPR EME COURT IN THE CASE OF ALLIED MOTORS P. LTD. (139 CTR 364) AND TH E SPECIAL BENCH DECISION OF ITAT, CHENNAI IN THE CASE OF KWALITY MILK FOOD LTD. (102 TTJ 1) AND ALSO RELYING ON THE DECISION OF THE DIVIS ION BENCH OF ITAT, HYDERABAD IN THE CASE OF RACE CLUB V/S. JCIT (ITA NO. 130 AND 131/HYD/2002), THAT THE PAYMENTS MADE BY THE ASSESSEE TO WARDS PF AND ESI BEFORE THE DUE DATE FOR FILING OF THE RETUR N UNDER S.139(1) HAS TO BE ALLOWED AS DEDUCTION. SINCE THE IMPUGNED ORDERS OF THE CIT(A) ARE IN CONSONANCE WITH THE DECISION OF THE TRIBUNAL IN T HAT CASE, IN THE ABSENCE OF ANY DECISION TO THE CONTRARY BROUGHT TO OUR NOTICE BY THE REVENUE, WE FIND NO INFIRMITY IN THE IMPUGNED ORDER OF THE CIT(A). WE ACCORDINGLY UPHOLD THE ORDERS OF THE CIT(A) ON THIS ASP ECT AND REJECT THE GROUNDS OF THE REVENUE IN THESE APPEALS ON THIS ISSU E. 4. IN THE RESULT, ALL THE FOUR THESE APPEALS OF THE R EVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON 8.10.2010 SD/- SD /- (AKBER BASHA) (N.R.S.GANESAN) ACCOUNTANT MEMBER. JUDICIAL MEMBER. DT/- 8TH OCTOBER, 2010 ITA NO.1050-1053/HYD/09 M/S. NAVAYUGA ENGINEERING CO. LTD., VI SAKHAPATNAM 5 COPY FORWARDED TO: 1. M/S. NAVAYUGA ENGINEERING CO. LTD., 48-9-17, DWARAKA NAGAR, VISAKHAPATNAM 2. ASST. COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE-1, HYDERABAD 3. CIT(A) I HYDERABAD 4. COMMISSIONER OF INCOME-TAX (CENTRAL), HYDERABAD. 5. THE D.R., ITAT, HYDERABAD. B.V.S.