Dy. CIT, Circle 1(1), Pune V. Baramati Agro Ltd., Pune

ITA 1379/PUN/2013

• Counselvise Citation: 137924514 RSA 2013
• Duration Of Justice: 1 year(s) 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 01-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B C MALAKAR
• Assessee Lawyers: P S SHINGTE
• Keywords: Depreciation
• Section: 32

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NOS.1379 & 1380/PN/2013 (A.YS: 2010-11 & 2009-10) DY.CIT, CIRCLE 1(1), PUNE APPELLANT VS. BARAMATI AGRO LTD., PIMPALI BARAMATI, PUNE 411001 PAN: AAACB7067M RESPONDENT APPELLANT BY : SHRI B.C. MA LAKAR RESPONDENT BY : SHRI P.S. SHINGTE DATE OF HEARING: 05.08.2014 DATE OF ORDER : 14.08.2014 ORDER PER SHAILENDRA KUMAR YADAV, J.M: BOTH THE APPEALS HAVE BEEN FILED BY THE REVENUE AG AINST THE COMMON ORDER OF COMMISSIONER OF INCOME TAX (APPEAL) -I, PUNE, DATED 30.04.2013 FOR A.YS. 2009-10 AND 2010-11 ON T HE FOLLOWING COMMON GROUNDS. 1. THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) IS CONTRARY TO LAW AND TO THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) GROSSLY ERRED IN ALLOWING THE ASSESSEE'S CLAIM OF D EPRECIATION ON THE POULTRY SHEDS AT THE RATE OF 15% BY TREATING THE SAME AS PLANT & MACHINERY. 3. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) GROSSLY ERRED IN NOT CONFIRMING THE STAND TAKEN BY THE ASSESSING OFFICER THAT AS POULTRY SHEDS ARE IN THE NATURE OF BUILDINGS, DEPRECIATION IS ADMISSIBLE AT THE RATE O F 10%. 2 ITA NOS.1379 & 1380 OF 13 BARAMATI AGRO LTD 4. FOR THESE AND SUCH OTHER GROUNDS AS MAY BE URGED AT THE TIME OF HEARING, THE ORDER OF THE LEARNED CIT(APPEA LS) MAY BE VACATED AND THAT OF THE ASSESSING OFFICER BE RES TORED. 5. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND A NY OF THE ABOVE GROUNDS OF APPEAL DURING THE COURSE OF TH E APPELLATE PROCEEDINGS BEFORE THE HON'BLE TRIBUNAL. 2. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF POUL TRY FARMING. THE ONLY ISSUE BEFORE US IS WITH REGARD TO THE DISA LLOWANCE OF DEPRECIATION @ 15% ON POULTRY SHEDS AT THE RATE APP LICABLE FOR PLANT AND MACHINERY. THE STAND OF THE ASSESSEE HAS BEEN THAT SINCE THE POULTRY SHEDS WERE SPECIFICALLY CONSTRUCT ED AND DESIGNED FOR THE PURPOSES OF BREEDING POULTRY, DEPR ECIATION SHOULD BE ALLOWED AT THE RATES PRESCRIBED FOR PLANT AND MACHINERY. HOWEVER, ON EXAMINATION OF SECTION 32 O F THE INCOME TAX ACT, 1961 READ WITH RULE 5 AND APPENDIX I OF TH E INCOME TAX RULES, 1962, THE ASSESSING OFFICER WAS OF THE VIEW THAT THE STRUCTURE IN WHICH THE BUSINESS OF POULTRY AND HATC HERY WAS CARRIED ON BY THE ASSESSEE AMOUNTED TO BUILDING ONL Y AND COULD NOT BE CLASSIFIED AS PLANT AND MACHINERY. ACCORDIN GLY, HE ALLOWED DEPRECIATION @ 10% APPLICABLE TO BUILDING F ROM THE OPENING WRITTEN DOWN VALUE AND DISALLOWED THE EXCES S CLAIM OF THE ASSESSEE OF RS.12,10,349/-. 3. THE MATTER WAS CARRIED BEFORE FIRST APPELLATE AU THORITY, WHEREIN THE VARIOUS CONTENTIONS WERE RAISED ON BEHA LF OF THE ASSESSEE AND HAVING CONSIDERED THE SAME AND FOLLOWI NG THE DECISION OF ITAT IN THE ASSESSEES OWN CASE, THE CI T(A) HAS ALLOWED THE CLAIM OF THE SAME. THE SAME HAS BEEN O PPOSED BEFORE US ON BEHALF OF THE REVENUE, INTER ALIA, SUB MITTED THAT THE CIT(A) ERRED IN ALLOWING THE ASSESSEE'S CLAIM OF DE PRECIATION ON THE POULTRY SHEDS AT THE RATE OF 15% BY TREATING TH E SAME AS PLANT & MACHINERY. ACCORDING TO LEARNED DEPARTMENT AL REPRESENTATIVE, THE POULTRY SHEDS ARE NOTHING BUT B UILDINGS AND 3 ITA NOS.1379 & 1380 OF 13 BARAMATI AGRO LTD THE DEPRECIATION IS ADMISSIBLE AT THE RATE OF 10%. SO, THE ORDER OF CIT(A) BE SET ASIDE AND THAT OF THE ASSESSING OFFIC ER BE RESTORED. ON THE OTHER HAND, THE LEARNED AUTHORIZED REPRESENT ATIVE HAS SUPPORTED THE ORDER OF CIT(A) ON THE ISSUE. 4. AFTER GOING THROUGH THE RIVAL SUBMISSIONS AND MA TERIAL ON RECORD, WE FIND THAT THE ISSUE UNDER APPEAL HAS ALR EADY BEEN DECIDED BY THE TRIBUNAL IN ASSESSEES OWN CASE IN F AVOUR OF THE ASSESSEE FOR A.Y.1992-93 VIDE ITA NO.221/PN/96, WHE REIN IT WAS HELD THAT THE POULTRY SHEDS STRUCTURES ARE NOT USED AS A SPACE FOR SHELTER BUT DESIGNED IN SUCH A MANNER AS TO WORK AS APPARATUS NECESSARY FOR CARRYING ON OF POULTRY FARMING BUSINE SS. POULTRY SHEDS ARE SPECIFICALLY DESIGNED TO WORK AS MEANS OF BUSINESS OF THE ASSESSEE, SO THAT IN THE SHEDS ALL THE NECESSAR Y PROVISIONS FOR VENTILATION, INSULATION, FLOORING, LIGHTING ETC. AR E MADE FOR CARRYING ON ALL THE THREE OPERATIONS SUCH AS BROODI NG, GROWING AND LAYING. POULTRY SHEDS REQUIRES PARTICULAR TYPE OF STRUCTURE WITHOUT WHICH THE BUSINESS OF POULTRY FARMING COULD NOT BE CARRIED OUT. THE ITAT, PUNE HAS RENDERED THE DECIS ION BY FOLLOWING THE DECISION OF ITAT, CHANDIGARH B BENC H IN THE CASE OF SHIVALIK HATCHERIES PVT. LTD. VS DY.CIT VIDE ITA NO.935/CHD/1995. IN VIEW OF ABOVE, THE CIT(A) WAS JUSTIFIED IN ALLOWING THE ASSESSEES CLAIM OF DEPRECIATION @ 15% INSTEAD OF 10% ON THE POULTRY SHEDS BY TREATING THE SAME AS PL ANT & MACHINERY. THIS VIEW IS ALSO FORTIFIED BY THE DECI SION OF ITAT, PUNE IN THE CASE OF VENKATESHWARA FARMS PVT. LTD. THIS REASONED FINDING OF CIT(A) NEEDS NO INTERFERENCE FR OM OUR SIDE. WE UPHOLD THE SAME. 4.1 A SIMILAR ISSUE AROSE IN ITA NO.1380/PN/2013 FO R A.Y. 2009-10. FACTS BEING SIMILAR, SO FOLLOWING THE SAM E REASONING, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING O F CIT(A), WHO WAS JUSTIFIED IN ALLOWING THE ASSESSEES CLAIM OF D EPRECIATION @ 4 ITA NOS.1379 & 1380 OF 13 BARAMATI AGRO LTD 15% INSTEAD OF 10% ON THE POULTRY SHEDS BY TREATING THE SAME AS PLANT & MACHINERY. WE UPHOLD THE SAME. 5. IN THE RESULT, BOTH THE APPEALS FILED BY THE REV ENUE ARE DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS THE 14 TH DAY OF AUGUST, 2014. SD/- SD/- (R.K. PANDA) (SHAILENDRA KUMAR YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED: 14 TH AUGUST, 2014 GCVSR COPY TO:- 1) DEPARTMENT 2) ASSESSEE 3) THE CIT(A)-I, PUNE 4) THE CIT-I, PUNE 5) THE DR, A BENCH, I.T.A.T., PUNE. 6) GUARD FILE BY ORDER //TRUE COPY// SENIOR PRIVATE SECRETARY, I.T.A.T., PUNE