Deputy Commissioner of Income tax, Jalgaon V. M/s.Nilon's Enterprises, Pune

ITA 1395/PUN/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 1007 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-09-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 01-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRI
• Keywords: Depreciation; Additional depreciation; Revised return
• Section: 143(3); 143(2)

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO.1395/PUN/2017 / ASSESSMENT YEAR : 2012-13 THE DY. COMMISSIONER OF INCOME TAX, CIRCLE 2, JALGAON. . / APPELLANT. V/S M/S. NILONS ENTERPRISES, S.NO.131/1A/5, SUNDER BAN COMPLEX, BALEWADI PHATA, BANER, PUNE. PAN : AABCN8601N. . / RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK. REVENUE BY : SHRI PANKAJ GARG. / ORDER PER ANIL CHATURVEDI, AM : 1. THIS APPEAL FILED BY THE REVENUE IS EMANATING OUT OF THE O RDER OF COMMISSIONER OF INCOME TAX (A) 2, NASHIK DATED 08.03.2017 FOR THE ASSESSMENT YEAR 2012-3. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON R ECORD ARE AS UNDER :- ASSESSEE IS A COMPANY STATED TO BE ENGAGED IN THE BUS INESS OF MANUFACTURING OF PICKLES, PAPPADS, JAMS ETC. ASSESSEE ELEC TRONICALLY FILED ITS RETURN OF INCOME FOR A.Y. 2012-13 DECLARING LOSS OF / DATE OF HEARING : 25.07.2019 / DATE OF PRONOUNCEMENT: 06.09.2019 2 RS.2,57,24,066/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ASSESSMENT WAS FRAMED U/S 143(3) OF THE ACT VIDE ORDER D ATED 16.03.2015 AND THE TOTAL LOSS WAS DETERMINED AT RS.2,19,00 ,036/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATT ER BEFORE LD.CIT(A), WHO VIDE ORDER DT.08.03.2017 (IN APPEAL NO.NSK/CIT (A)- 2/786/14-15) ALLOWED THE APPEAL OF THE ASSESSEE. AGGRIEV ED BY THE ORDER OF LD.CIT(A), REVENUE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS : 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD CIT(A) ERRED IN ALLOWING THE CLAIM OF ADDITIONAL DE PRECIATION OF RS.80,94,015/- ON THE DRUMS WHICH WAS NOT CLAIMED I N THE ORIGINAL RETURN OF INCOME AND CLAIMED DURING THE COURSE OF S CRUTINY PROCEEDINGS. 2. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LD CIT(A) ERRED IN NOT APPRECIATING THE FACT THAT TH E ASSESSEE HAD TIME TO FILE A REVISED RETURN OF INCOME BEFORE THE ISSUANCE OF NOTICE U/S 143(2) OF THE INCOME TAX ACT, 1961 AND DID NOT DO S O. THE LD.CIT(A) ALSO ERRED IN NOT FOLLOWING THE DECISION OF HON'BLE SUPREME COURT IN GOETZE (INDIA) LTD VS CIT 284 ITR 323. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE ORDER OF THE LD.CIT(A) BE CANCELLED ON THE ABOVE ISSUE AN D THAT OF THE AO BE RESTORED. 4. THE APPELLANT CRAVES TO ADD, ALTER, MODIFY, DELE TE AMEND ANY OF THE GROUNDS WITH PRIOR PERMISSION OF THE HONBLE PR.CIT , AS PER THE CIRCUMSTANCES OF THE CASE. 5. THE APPELLANT PRAYS TO FILE ANY OF THE ADDITIONA L EVIDENCE APPROPRIATE TO THE GROUNDS TAKEN IN APPEAL WITH PRIOR PERMISSIO N OF THE HONBLE PR.CIT, AS PER THE CIRCUMSTANCES OF THE CASE. 3. ALL THE GROUNDS BEING INTER-CONNECTED ARE CONSIDERED TOGETHE R. 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS BEFORE A O ASSESSEE SUBMITTED THAT IN THE PRECEDING YEAR IT HAD CLAIMED ONLY 50% OF THE ALLOWABLE ADDITIONAL DEPRECIATION I.E., AT RS.80,94,015/- AS THE NEW MACHINERY WAS USED FOR LESS THAN 180 DAYS IN THE YEAR U NDER CONSIDERATION. IT WAS SUBMITTED THAT THOUGH ASSESSEE W AS ENTITLED TO 3 CLAIM BALANCE ADDITIONAL DEPRECIATION IN THE YEAR UNDER CON SIDERATION BUT DUE TO OVERSIGHT, THE ADDITIONAL DEPRECIATION COULD NO T BE CLAIMED IN THE RETURN OF INCOME. IT WAS THEREFORE URGED BEFORE THE AO THAT THE BALANCE ADDITIONAL DEPRECIATION OF 50% BE ALLOWED. AO NOTED THAT SINCE ASSESSEE HAD NOT CLAIMED THE BALANCE ADDITIONAL DEPRECIATIO N IN THE RETURN OF INCOME NOR HAD MADE ANY CLAIM BY FILING REVISED R ETURN OF INCOME, THE CLAIM OF ASSESSEE FOR ADDITIONAL DEPRECIATION WAS NOT ALLOWABLE AND ACCORDINGLY DENIED THE CLAIM OF ADDITIONAL DEPRE CIATION. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATT ER BEFORE LD.CIT(A), WHO BY FOLLOWING THE DECISION OF ITAT, DELHI IN THE CASE OF DCIT VS. COSMO FILMS LTD., REPORTED IN (2012) 139 ITD 0628 AND THE DECISIONS IN THE CASE OF CIT VS, RAMCO INTERNATIONAL (2011) 332 ITR 306, CIT VS. METALMAN AUTO (P) LTD., (2011) 336 ITR 434, CIT VS. JAI PARABOLIC SPRINGS LTD., (2008) 6 DTR 233 AND THE CBDT CIR CULAR NO.14 DATED 11.04.1955 HELD THAT ASSESSEE WAS ELIGIBLE FOR CLAIM O F ADDITIONAL DEPRECIATION. HE ACCORDINGLY DIRECTED THE AO TO ALLOW TH E CLAIM OF ADDITIONAL DEPRECIATION. AGGRIEVED BY THE ORDER OF LD.CIT(A), REVENUE IS NOW IN APPEAL BEFORE US. 5. BEFORE US, LD. D.R. SUPPORTED THE ORDER OF AO. LD.A.R. ON THE OTHER HAND, REITERATED THE SUBMISSIONS MADE BEFORE AO AN D LD.CIT(A) AND SUPPORTED THE ORDER OF LD.CIT(A). 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT GROUND IS WITH RESPECT TO THE ALLOWABILITY OF CLAIM OF ADDITIONAL DEPRECIATION OF RS.80,94,015/-. I T IS AN UNDISPUTED FACT THAT IN THE PRECEDING ASSESSMENT YEA R ASSESSEE HAD CLAIMED ADDITIONAL DEPRECIATION ONLY TO THE EXTENT OF 50% A S MACHINERY WAS USED LESS THAN 180 DAYS. THOUGH, THE ASSESSEE WAS ELIGIBLE TO 4 CLAIM THE BALANCE ADDITIONAL DEPRECIATION IN THE YEAR UNDER CONSIDERATION, IT IS ASSESSEES CONTENTION THAT IT FORGOT TO CLAIM THE ADDITIONAL DEPRECIATION IN THE RETURN OF INCOME. IT IS CONT ENDED THAT CLAIM WAS MADE BEFORE THE AO BUT THE AO REJECTED THE CLAIM INVIEW OF THE FACT THAT ASSESSEE HAD NOT CLAIMED THE ADDITIONAL DEP RECIATION IN THE RETURN OF INCOME NOR HAD FILED THE REVISED RETURN OF IN COME. WE FIND THAT LD.CIT(A) AFTER CONSIDERING THE VARIOUS DECISIONS CITED IN THE ORDER AND THE CBDT CIRCULAR HELD THAT ASSESSEE IS ELIGIBLE FOR THE CLAIM OF ADDITIONAL DEPRECIATION. WE FURTHER FIND THAT HONBLE BOMBA Y HIGH COURT IN THE CASE OF PCIT VS. GODREJ INDUSTRIES LTD. IN ITA NO.511/2016 ORDER DATED 24.11.2018 AFTER CONSIDERING THE DECISIONS OF HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. RITT AL INDIA PVT. LTD., (2016) 380 ITR 423 HELD THAT ASSESSEE CAN CLAIM 5 0% DEPRECIATION IN SUBSEQUENT YEAR IN A CASE WHERE PLANT AN D MACHINERY BEING ACQUIRED AND PUT TO USE IS FOR LESS THAN 180 DAYS IN THE PREVIOUS YEAR. BEFORE US, REVENUE HAS NEITHER PLACED ANY CONTR ARY BINDING DECISION IN ITS SUPPORT NOR HAS POINTED OUT ANY FALLACY IN T HE FINDINGS OF LD.CIT(A). IN SUCH A SITUATION, WE FIND NO REASON TO INTERFER E WITH THE ORDER OF LD.CIT(A). THUS, THE GROUNDS OF REVENUE ARE DISMISSED. 7. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSED. ORDER PRONOUNCED ON 6 TH DAY OF SEPTEMBER, 2019. SD/- SD/- ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) ! / JUDICIAL MEMBER '! / ACCOUNTANT MEMBER PUNE; DATED : 6 TH SEPTEMBER, 2019. YAMINI 5 #$%&'('% / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5 6. CIT(A)-2, NASHIK. PR. CIT-2, NASHIK. '#$ %%&',) &', / DR, ITAT, B PUNE; $*+,/ GUARD FILE. / BY ORDER // TRUE COPY // -./%0&1 / SR. PRIVATE SECRETARY ) &', / ITAT, PUNE.