The ITO, Ward-2(2), Surat V. Smt. Deepti Pankaj Chugh, Surat

ITA 141/AHD/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0497 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 15-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K PANDEY
• Keywords: Depreciation; Additional depreciation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD , .. , '# ' $ BEFORE SHRI MUKUL KR.SHRAWAT, JUDICIAL MEMBER AND SHRI T.R.MEENA, ACCOUNTANT MEMBER ./ I.T.A. NO.141/AHD/2013 ( % & '& / ASSESSMENT YEAR : 2008-09) INCOME TAX OFFICER WARD-2(2) SURAT % / VS. SMT.DEEPTI PANKAJ CHUGH 4007, ASHOKA TOWER MARKET RING ROAD SURAT 395 001 ./ ./ PAN/GIR NO. : AEBPC 8378 J ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI A.K. PANDEY, SR.D.R. / RESPONDENT BY : -NONE- / DATE OF HEARING : 12/03/2013 !'# / DATE OF PRONOUNCEMENT : 15/3/13 $% / O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THIS IS AN APPEAL FILED BY THE REVENUE ARISING FRO M THE ORDER OF LD.CIT(A)-II, SURAT DATED 31/10/2013 PASSED FOR A. Y. 2008-09 AND THE ONLY GROUND IS GROUND NO.1; REPRODUCED BELOW:- [1] ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE LD.CIT(A)-I, SURAT HAS ERRED IN DELETING THE ADDITI ON OF RS.9,71,758/- MADE ON ACCOUNT OF ADDITIONAL DEPRECI ATION CLAIMED ON EMBROIDERY MACHINE AS THE FACT THAT THE EMBROIDE RY WORK DOES NOT GIVE ANY PRODUCT WHICH IS DISTINCT IN QUALITY A ND SHAPE FROM THAT OF THE INPUT RAW MATERIAL WAS NOT APPRECIATED. ITA NO.141/AHD/ 2013 ITO VS. SMT.DEEPTI PANKAJ CHUGH ASST.YEAR - 2008-09 - 2 - 2. THE ISSUE WHICH EMERGES FROM THE CORRESPONDING A SSESSMENT ORDER PASSED U/S.143(3) OF THE IT ACT DATED 31/12/2010 WH ETHER THE ASSESSEE IS ENTITLED FOR HIGH RATE OF DEPRECIATION ON THE EMBRO IDERY MACHINERY. THE LD.CIT(A) HAS ALLOWED THE CLAIM OF DEPRECIATION FOL LOWING THE ORDERS OF THE TRIBUNAL AS FOLLOWS:- 3.1. IN THIS CASE, ASSESSEE IS ENGAGED IN THE BUSI NESS OF EMBROIDERY WORK ON SYNTHETIC FABRICS ON JOB BASIS I N HIS PROPRIETARY CONCERNS NAMELY M/S.SWASTIK ENTERPRISES & M/S.VAISHNAV EMBROIDERY. DURING THE YEAR UNDER CON SIDERATION, ASSESSEE HAS CLAIMED 20% ADDITIONAL DEPRECIATION AM OUNTING TO RS.9,71,758/- U/S.32(1)(IIA) OF THE ACT ON NEW MACH INERY INSTALLED BY HER CLAIMING HERSELF INVOLVED IN THE BUSINESS OF MANUFACTURE OF PRODUCTION OF ARTICLE OR THING. AS PER AO, ACTIVIT IES PERFORMED BY ASSESSEE IS BASICALLY JOB WORK OF EMBROIDERY ON FIN ISHED CLOTHS OBTAINED FROM HER CLIENTS WHICH ARE NEITHER MANUFAC TURED NOR PROCESSED BY HER. HENCE, ASSESSEE CANNOT BE CONSID ERED AS MANUFACTURER OR PRODUCER INSTEAD SHE CAN BE BETTER TREATED AS JOB WORKER. CONSEQUENTLY, THE ADDITIONAL DEPRECIATION OF RS.9,71,758/- CLAIMED BY ASSESSEE WAS DISALLOWED BY HIM. 3.2. DURING THE APPELLATE PROCEEDINGS, APPELLANT SU BMITTED THAT THE ISSUE OF ADDITIONAL DEPRECIATION ON EMBROIDERY WORK HAS ALREADY BEEN DECIDED IN FAVOUR OF ASSESSEE BY HONB LE SUPREME COURT IN THE CASE OF S.S.M.BROTHERS (P) LTD. AND OT HERS VS CIT (243 ITR 418) AND JURISDICTIONAL ITAT IN THE CASE O F ITO VS. HARIPRIYA PROCESSORS (P) LTD. IN VIEW OF THE FACT THAT THE ISSUE HAS ALREADY BEEN DECIDED BY APEX COURT AS WELL AS JURIS DICTIONAL ITAT, APPELLANT REQUESTED TO DELETE THE ADDITION MA DE BY AO ON THE SIMILAR FACTS. 3.3. I HAVE GONE THROUGH THE FACTS OF THE CASE AND FOUND THAT THE ISSUE INVOLVED IN THE GROUND OF APPEAL IS WHETHER E MBROIDERY WORK CARRIED ON EMBROIDERY MACHINES IS A MANUFACTURING A CTIVITY OR NOT AND, CONSEQUENTLY, ADDITIONAL DEPRECIATION U/S.32(1 )(IIA) IS ALLOWABLE ON THESE MACHINES OR NOT. THIS ISSUE HAS SINCE BEEN DECIDED BY THE ITAT, AHMEDABAD BENCH IN SEVERAL CAS ES, IN FAVOUR ITA NO.141/AHD/ 2013 ITO VS. SMT.DEEPTI PANKAJ CHUGH ASST.YEAR - 2008-09 - 3 - OF THE ASSESSEE, INCLUDING THE DECISION IN THE CASE OF ITO VS. HARIPRIYA PROCESSORS (P) LTD., RELIED UPON BY THE A PPELLANT. I, THEREFORE, RELYING UPON THE DECISION OF THE ITAT, A HMEDABAD, ALLOW THIS GROUND OF APPEAL. 3. NONE APPEARED ON BEHALF OF THE RESPONDENT-ASSESS EE. WE HAVE HEARD THE LD.SR.DR MR.A.K.PANDEY. NOW, WE FIND TH AT THIS ISSUE IS VERY WELL SETTLED IN FAVOUR OF ASSESSEE BY SEVERAL DECIS IONS OF THIS TRIBUNAL AND SOME OF THE CASES ARE LISTED BELOW:- SL.NO(S) DECISION IN THE CASE OF IN ITA NO(S) 1. M/S.HARI FASHIONS VS. ASST.CIT 3105/AHD/2010- A.Y.2007-08 ITAT BENCH A AHMEDABAD, ORDER DATED 27/5/2011 2. ITO VS. HARIPRIYA PROCESSORS PVT.LTD. 1569/AHD/2010- A.Y.2007-08 ITAT BENCH SMC AHMEDABAD, ORDER DATED 08/09/2009 3. ITO VS.M/S.ASWANI INDUSTRIES, SURAT 2103/AHD/2010- A.Y.2007-08 ITAT BENCH D AHMEDABAD, ORDER DATED 29/10/2010 4. M/S.K.K.CREATION VS. ITO 1965/AHD/2010- A.Y.2008-09 ITAT BENCH B AHMEDABAD, ORDER DATED 30/04/2012 4. SINCE THE TRIBUNAL HAS CONSISTENTLY FOLLOWED A VIEW IN FAVOUR OF THE ASSESSEE, WE HAVE NO REASON TO TAKE ANY OTHER VIEW BUT TO FOLLOW THE ITA NO.141/AHD/ 2013 ITO VS. SMT.DEEPTI PANKAJ CHUGH ASST.YEAR - 2008-09 - 4 - VIEW ALREADY TAKEN IN ASSESSEES FAVOUR. CONSEQUE NTLY, FOR THIS CASE AS WELL REVENUES GROUND IS HEREBY DISMISSED. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. SD/- SD/- ( &..'# ) ( ' ' ( ) $ )* $ ( T.R. MEENA ) ( MUKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 15/ 03 /2013 &.., .*../ T.C. NAIR, SR. PS ') * +,- .'-' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. , -. / / CONCERNED CIT 4. / () / THE CIT(A)-II, SURAT 5. 234 **-., -.#, 5'$,$ / DR, ITAT, AHMEDABAD 6. 467 8 / GUARD FILE. ')% / BY ORDER, 2 * //TRUE COPY// // 0 ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION DATED 13.3.13 (DICTATION PAD 2 PAGES ATTACHED) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 14.3.13 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S15.3.13 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 15.3.13 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 9. DATE OF DESPATCH OF THE ORDER