DCIT, Circle-6(1), Hyderabad V. M/s. Manchukonda Prakasham & Co., Hyderabad

ITA 110/HYD/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7621 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 28-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHAN REDDY
• Assessee Lawyers: CHAITANYA KUMAR
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI P.M.JAGTAP, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO.110/HYD/14 (ASSESSMENT YEAR 2009 - 10) DY. COMMISSIONER OF INCOME - TAX CIRCLE 6(1), HYDERABAD V/S. M/S. MANCHUKONDA PRAKASAM & CO., HYDERABAD (PAN - AADFM 0073 G) (APPELLANT) (RESPONDENT) APPELLANT BY : S HRI MOHAN REDDY, DR RESPONDENT BY : SHRI CHAITANYA KUMAR DATE OF HEARING 14 .0 8 .2014 DATE OF PRONOUNCEMENT 20.08.2014 O R D E R PER P.M.JAGTAP, ACCOUNTANT MEMBER: THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME - TAX(APPEALS) IV, HYDERABAD DATED 29.11.2013 AND THE SOLITARY ISSUE ARISING OUT OF THE SAME RELATES TO THE CLAIM OF THE ASSESSEE FOR DEPRECIATION AT HIGHER RATE OF 30% ON T R UCKS, WHICH HAS BEEN ALLOWED BY THE LEARNED CIT(A). 2. THE ASSESSEE IN THE PRESENT CASE IS A PARTNERSHIP FIRM, WHICH IS ENGAGED IN THE BUSINESS OF MANUFACTURE OF P RE - S TRESSED CONCRETE CEMENT POLES AND EXECUTING CONTRACT WORKS . RETURN OF INCOME FOR THE Y E AR UNDER CONS IDERATION WAS FILED B Y IT ON 30.9.2009 DECLARIN G TOTAL INCOME OF RS.11,46,02,240 . I N THE S A I D RETURN, DEPRECIATION AT HIGHER RATE OF 30% WAS CLAIMED BY THE ASSESSEE ON TRUCKS. DURIN G THE COU R SE OF ASSESSMENT PROCEE D INGS, THIS CLAIM O F TH E ASSESSEE WAS E X A MIN E D BY THE ASSESSING OFFICER A ND ON SUCH EXAMINATION, HE FOUN D TH A T THE TRUCKS WERE BEIN G USED I TA NO. 110 /H YD/201 4 M/S. MANCHUKONDA PRAKASAM & CO., HYDERABAD 2 BY THE ASSESSEE FOR TRANSP O RTATION OF POLES MANUFACTURED BY IT FROM THE FACTORY TO VARIOUS CU S TOMERS. ACCOR D ING TO TH E ASSESSING OFFICER, THE TRUCKS, THUS, WER E USED BY THE ASSESSEE IN ITS BUSINESS AND IT WAS NOT A CA S E OF USE O F TRUCKS IN BU S IN E SS OF RUNNING THEM ON HIRE. HE, TH E R E FORE, R E STRICTED THE CLAIM OF TH E ASSESSEE FOR DEP R ECI A TION ON TRUCKS TO 15%. 3. ON APPEAL, TH E LEARNED CIT(A) ALLOWED THE CLAIM OF THE ASSESSEE FOR DEPRECIATION ON TRUCKS AT HIGHER RATE OF 30%, BY FOLLOWING THE DECISION O F TH E T RIBUNAL IN ASSESSEES OWN CA S E FOR ASSESSMENT YEAR 2007 - 08 REND E RED ON SIMILAR ISSUE VIDE ITS ORDER DATED 20.6.2012 PASSED IN ITA N O . 1073/HYD/2010. 4. AGG R IEVED BY THE O R DER OF TH E LEARNED CIT(A), REVENUE HAS PREFERRED THIS AP P EAL. 5 . WE HAVE HEARD THE ARGUMENTS OF BOTH SIDES AND ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS OB S E R VED THAT A SIMILAR CLAIM MADE BY THE ASSESSE E FOR DEPRECIATION AT HIGHER RATE ON TRUCKS WAS ALLOWED BY THE TRIBUNAL IN ASSESSMENT YEAR 2007 - 08 VIDE ITS ORDER DATED 20.6.2012, CITED SUPRA, FOR THE FOLLO WI N G REASON S GIVEN IN PARAGRAPH 18 THEREOF - 18. WE HAVE HEARD RIVAL CONTENTIONS ON THE ISSUE. THE WORD HIRE HAS NOT BEEN DEFINED IN THE ACT. THE DICTIONARY MEANING OF HIRE MEANS COMPENSATION FOR THE USE OF THING OR FOR LABOUR OR SERVICES. FROM THE AFORESAID MEANING OF WORD HIRE, IT IS QUITE CLE AR THAT EVEN IN CASE OF GOODS HAVING TRANSPORTED FROM ONE PLACE TO ANOTHER FOR CONSIDERATION, IT HAS TO BE HELD THAT THE VEHICLE HAS BEEN GIVEN ON HIRE FOR TRANSPORTING GOODS OF THE CUSTOMER. SINCE IN THE PRESENT CASE, IT HAS BEEN FOUND ON RECORD THAT THE TRUCKS WERE EXCLUSIVELY USED FOR TRANSPORTATION OF GOODS OF THE CUSTOMERS ON RECEIPT OF TRANSPORTATION CHARGES, IT CAN BE SAID THAT THE TRUCKS HAVE BEEN GIVEN ON HIRE TO THE CUSTOMERS AND AS SUCH IS ELIGIBLE FOR DEPRECIATION AT THE I TA NO. 110 /H YD/201 4 M/S. MANCHUKONDA PRAKASAM & CO., HYDERABAD 3 RATE OF 30%. IN VIEW OF THE ABOVE, THIS GROUND OF THE ASSESSEE IS ALLOWED. THE ABOVE DECISION RENDERED IN ASSESSMENT YEAR 20 0 7 - 08 HAS BEEN SUBSEQUENTLY FOLLOWED BY THE TRIBUN A L IN ASSESSMENT YEAR 2008 - 09, TO DECIDE SIMIL AR ISSUE IN FAVOUR OF THE ASSESSEE VIDE O R DER DATED 3.8.2 012, PASSED IN ITA NO.1812/HYD / 2011. AS THE ISSUE INVOLVED IN THE Y EA R UN D ER CONSIDERATION AS WELL AS THE FACTS RELEVANT THERETO ARE SIMILAR TO THAT OF ASSESSMENT YEAR 2007 - 08 AND 2008 - 09, WE RESPECTFULLY FOLLOW THE DECISIONS OF THE TRIBUNAL FOR THOSE YE ARS NOTED ABOVE , AND UPHOLD THE IMPUGNED ORDER OF THE CIT(A), ALLO W IN G THE CLAIM OF THE ASSESSEE FOR DEPRECIATION ON TRUCKS AT HIGHER RATE OF 30% . 6 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 20 TH AUGUST, 2014 SD/ - SD/ - ( SAKTIJIT DEY ) ( P.M.JAGTAP ) JUDICIAL MEMBER ACCOUNTANT MEMBER DT/ - 20 TH AUGUST, 2014 COPY FORWARDED TO: 1. M/S. MANCHUKONDA PRAKASAM & CO., 6 - 3 - 347/12/A/12/3, DWARAKAPURI COLONY, PANJAGUTTA, HYDERABAD 2 . DY. COMMISSIONER OF INCOME - TAX , CIRCLE 6(1), HYDERABAD 3. 4. COMMISSIONER OF INCOME - TAX(APPEALS) IV, HYDERABAD COMMISSIONER OF INCOME - TAX III, HYDERABAD 5 . DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S