ITO (E)I(1), MUMBAI V. COSMOPOLITAN EDUCATION SOCIETY, MUMBAI

ITA 1154/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 84377 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 28-05-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 08-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PREMANAND J
• Assessee Lawyers: V G GINDE
• Keywords: Depreciation
• Section: 154

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C , BENCH MUMBAI , BEFORE SHRI H. L. KARWA , PRESIDENT & SHRI R.C.SHARMA , A M ( / ITA NO. 1154 /MUM/201 3 ) ( ASSESSMENT YEAR :200 8 - 200 9 ) ITO (E) I (1), MUMBAI VS. COSMOPOLITAN EDUCATION SOCIETY, D.N.NAGAR, LINK ROAD, ANDHERI (W), MUMBAI - 53 PAN/GIR NO. : A A ATC 1726 F ( APPELLANT ) .. ( RESPONDENT ) /REVENUE BY : SHRI PREMANAND J /ASSESSEE BY : SHRI V.G.GINDE DATE OF HEARING : 9 TH DEC EMBER 201 4 DATE OF PRONOUNCEMENT : 9 TH DEC EMBER 201 4 O R D E R PER R.C.SHARMA ( A .M.) : TH IS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A), DATED 27 - 11 - 2012 FOR ASSESSMENT YEAR 2008 - 09, IN THE MATTER OF ORDER PASSED U/S.154 OF THE IT ACT. 2 . THE ONLY GRIEVANCE OF THE REVENUE RELATES TO THE CIT(A)S ACTION IN DIRECTING THE AO TO ALLOW THE CLAIM OF DEPRECIATION AMOUNTING TO RS. 33,24,658/ - U/S.154 OF THE I.T.ACT. 3 . RIVAL CONTENTION HAVE BEEN HEARD AND RECORD PERUSED. FACTS IN BRIEF ARE THAT IN THE RETURN OF INCOME, ASSE SSEE DID NOT CLAIM D EPRECIATION. SUBSEQUENTLY ASSESSEE MOVED AN APPLICATION U/S.154 REQUESTING THE AO TO GRANT DEDUCTION ON ACCOUNT OF DEPRECIATION IN ITA NO. 1154 /201 3 2 RESPECT OF BUILDING. THE AO HELD THAT PROVISIONS OF SECTION 154 CAN BE INVOKED ONLY WHEN MISTAKE IS APPARENT FROM RECORD, SIN CE CLAIM OF DEPRECIATION WAS NOT MAKE IN THE RETURN OF INCOME, THEREFORE, MISTAKE DOES NOT BECOME APPARENT, THEREFORE, FALLS BEYOND THE SCOPE OF SECTION 154. 4 . AGAINST THE ABOVE ORDER OF AO U/S.154, THE ASSESSEE APPROACHED TO THE CIT(A) AND THE CIT(A) DIR ECTED THE AO TO ALLOW THE CLAIM OF DEPRECIATION. THE CIT(A) FURTHER DIRECTED THE AO TO ALLOW THE SAME AS ALLOWABLE UNDER LAW . AFTER HAVING THE FOLLOWING OBSERVATIONS : - 3.3 I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE APPELLANT, THE ASSESSMENT OR DER AND FACTS OF THE CASE. I FIND THAT APPELLANT DID NOT CLAIM THE DEPRECIATION OF RS.33,24,658/ - ON CERTAIN ASSETS LIKE BUILDING ETC. WITH THE RETURN OF INCOME FILED ON 18.09.08. THE AO ASSESSED THE INCOME U/S.143(3) DTD.22.12.2010. SUBSEQUENTLY, THE APPE LLANT PREFERRED AN APPLICATION U/S.154 ON 19.02.2011.I FIND THAT THE DEPRECIATION WAS CLAIMED IN THE RECTIFICATION PROCEEDING BEFORE THE AO. HOWEVER, THE AO REJECTED THE APPLICATION FOR RECTIFICATION HOLDING THAT THE SAME WAS NOT A MISTAKE APPARENT FROM RE CORD. I FIND THAT THE APPELLANT SOCIETY IS ELIGIBLE FOR DEPRECIATION WHICH IS NOW MANDATORY AS PER THE ACT AFTER THE AMENDMENT TO SECTION 32. MOREOVER THIS BEING MANDATORY THE APPELLANT WAS WELL WITHIN ITS RIGHT TO CLAIM IN THE RECTIFICATION PROCEEDINGS ES PECIALLY WHEN THIS MISTAKE WAS NOT NOTICED BY THE AO IN THE ORDER PASSED U/S.143(3) OF THE ACT. THIS GROUND OF APPEAL IS THEREFORE, ALLOWED. THE AO IS DIRECTED TO ALLOW THE SAME AS ALLOWABLE UNDER LAW. 5 . WE HAVE CONSIDERED RIVAL CONTENTIONS, CAREFULLY G ONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND FROM RECORD THAT THE CIT(A) HAS DIRECTED THE AO TO ALLOW THE CLAIM OF DEPRECIATION U/S.32 ON THE PLEA THAT AS PER THE AMENDED PROVISIONS OF SECTION 32, THE ASSESSEE SOCIETY IS ELIGIBLE FOR DEPR ECIAT ION WHICH IS NOW MANDATORY AFTER AMENDMENT OF PROVISIONS OF SECTION 32. SINCE ALLOWING THE CLAIM OF DEPRECIATION IS MANDATORY, ASSESSEE WAS FOUND TO BE WELL WITHIN ITS ITA NO. 1154 /201 3 3 RIGHT TO CLAIM IN THE RECTIFICATION PROCEEDINGS. ACCORDINGLY, THE CIT(A) HAS DIRECTED TH E AO TO ALLOW THE SAME SUBJECT TO SPECIFIC DIRECTION THAT THE AO IS TO ALLOW THE CLAIM OF DEPRECIATION AS ALLOWABLE UNDER LAW . WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) FOR DIRECTING THE AO TO ALLOW THE CLAIM OF DEPRECIATION INSOFAR AS HE HAS SPECIFICALLY DIRECTED THE AO TO ALLOW CLAIM OF DEPRECIATION AS PER LAW. ACCORDINGLY, THE AO IS AT LIBERTY TO VERIFY THE CORRECTNESS OF ASSESSEES CLAIM AS PER LAW. DIRECTION OF CIT(A) IS MODIFIED ACCORDINGLY. WITH THIS OBSERVATION, WE DO NOT FIND ANY INFIR MITY IN THE ORDER OF CIT(A). 6 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 9 TH DEC. 201 4 . 9 TH DEC. ,2014 SD/ - SD/ - ( ) ( H.L.KARWA ) ( ) ( R.C.SHARMA ) / PRESIDENT / ACCOUNTANT MEMBER MUMBAI ; DATED 09/12 /2014 /PKM , PS COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( ASSTT. REGISTRAR) / ITAT, MUMBAI \ 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A), MUMBAI. 4. / CIT 5. / DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//