Sri. Arun Kumar M.B, Bangalore V. ITO-Ward-8(3), Bangalore

ITA 1417/BANG/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5660 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 10-08-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SWAPNA DAS
• Assessee Lawyers: G N BHAT
• Keywords: Depreciation; Opportunity of being heard; Reason to believe
• Section: 147; 148; 2; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-A BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER ITA NO S . 1417 TO 1419 / BANG/201 6 ASSESSMENT YEAR S : 20 1 1 - 1 2, 2012 - 13 & 2009 - 10 SHRI ARUN KUMAR M.B., NO. 123, 1 ST FLOOR, 2 ND PHASE, MAHALAKSHMIPUR, BANGALORE 560 086. PAN: AIHPK 5751D VS. THE INCOME TAX OFFICER, WARD 8(3), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI G.N. BHAT, CA RESPONDENT BY : SMT. SWAPNA DAS, JCIT (DR) DATE OF HEARING : 16 .01.2018 DATE OF PRONOUNCEMENT : 19 .0 1 .201 8 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER ALL THESE THREE APPEALS ARE ASSESSEES APPEALS WHIC H ARE DIRECTED AGAINST THREE SEPARATE ORDERS OF LD. CIT(A) 6, BANGALORE ALL DATED 25.03.2016 FOR ASSESSMENT YEARS 2009-10, 2011-12 & 2012-13. 2. ALL THESE THREE APPEALS WERE EARLIER DISPOSED OF BY THE TRIBUNAL BY WAY OF A COMBINED TRIBUNAL ORDER DATED 23.02.2017 AND ALL TH ESE THREE APPEALS OF THE ASSESSEE WERE DISMISSED. SUBSEQUENTLY, THE ASSESSE E FILED THREE MPS BEING MP NOS. 155, 156 &157/BANG/2017 WHICH WERE DISPOSED OF BY THE TRIBUNAL AS PER ITS COMBINED ORDER DATED 09.08.2017 AND AS PER THIS COMBINED TRIBUNAL ORDER IN THESE THREE MPS, THE TRIBUNAL ORDER IN ITA NO. 1419/BANG/2016 WAS RECALLED FOR THE LIMITED PURPOSE OF DECIDING GROUND NOS. 1 AND 4 RAISED IN THIS APPEAL. HENCE, IN THE PRESENT PROCEEDINGS, I AM SU PPOSED TO DECIDE GROUND NOS. 1 AND 4 IN ITA NO. 1419/BANG/2016 BUT THE REGI STRY HAS FIXED ALL THE THREE APPEALS I.E. ITA NOS. 1417 TO 1419/BANG/2016. SINC E THE TRIBUNAL ORDER IN RESPECT OF ITA NOS. 1417 & 1418/BANG/2016 HAS NOT B EEN RECALLED IN THE MP ITA NOS. 1417 TO 1419/BANG/2016 PAGE 2 OF 5 ORDER, THESE TWO APPEALS STAND DISMISSED BY THE EAR LIER TRIBUNAL ORDER DATED 23.02.2017 AND REGISTRY IS DIRECTED TO CONSIGN THES E TWO APPEALS TO RECORDS AND I PROCEED TO DECIDE TWO GROUNDS IN ITA NO. 1419/BAN G/2017. THESE TWO GROUNDS READ AS UNDER. 1. THE A.O. WAS NOT CORRECT IN INITIATING THE PROCE EDINGS U/S 147 READ WITHSECTION 148 OF THE ACT, AS THERE WAS NO REASON TO BELIEVE RECORDED FOR INITIATION OF REOPENING PROCEEDINGS AND ALSO MA NDATORY APPROVAL FROM JCIT OR SUCH OTHER HIGHER AUTHORITY AND HENCE THE SAME IS BAD IN LAW. 4. THE CIT (APPEALS) WAS NOT CORRECT IN CONSIDERING THE FULL DEPRECIATION CLAIMED TO THE EXTENT OF RS.2,46,414/- , THOUGH THE APPELLANT HAS SUBMITTED THE BILLS FOR ADDITIONS TO FIXED ASSET AND DISALLOWED RS. 1,01,845/- AS EXCESS CLAIM OF DEPREC IATION AS WAS DONE BY A.O. 3. IN COURSE OF HEARING, THE LD. AR OF ASSESSEE SUB MITTED THAT GROUND NO. 1 IS NOT PRESSED AND ACCORDINGLY GROUND NO. 1 IN ITA NO. 141 9/BANG/2016 IS DISMISSED AS NOT PRESSED. 4. REGARDING GROUND NO. 4, HE SUBMITTED THAT THE AS SESSEE CLAIMED DEPRECIATION OF RS. 2,46,414/- DETAILS OF WHICH ARE AVAILABLE ON PAGE NO. 49 OF THE PAPER BOOK CONTAINING THE DEPRECIATION SCHEDULE FOR THE P RESENT YEAR. HE POINTED OUT THAT AS PER THIS DEPRECIATION SCHEDULE, THERE WAS O PENING WDV AS ON 01/04/2008 OF RS. 7,74,859/- INCLUDING COMPUTER OF RS. 1,32,000/-, FURNITURE & FIXTURE OF RS. 6,21,184/- AND MOTOR CYCLE OF RS. 21 ,675/-. THEREAFTER, HE POINTED OUT THAT DURING THE PRESENT YEAR, THERE WAS ADDITION IN COMPUTER OF RS. 1,05,995/- BEFORE 30.09.2008 AND RS. 62,830/- AFTER 30.09.2008 AND THERE WAS ADDITION OF RS. 5,500/- IN FURNITURE & FIXTURE AFTE R 30.09.2008. THEREAFTER HE POINTED OUT THAT AS PER THE ASSESSMENT ORDER, THE A O ALLOWED DEPRECIATION ON THE OPENING WDV OF RS. 7,74,859/- AS DEPRECIATION A LLOWED BY HER IS RS. 1,44,569/- AND SHE DISALLOWED THE DEPRECIATION CLAI MED TO THE EXTENT OF RS. 1,01,845/- IN RESPECT OF THE ADDITIONS MADE BY THE ASSESSEE IN THE PRESENT YEAR ON THIS BASIS THAT THE ACTUAL DEPRECIATION AS PER C OMPUTATION FURNISHED IN THE ASSESSMENT ORDER IS ONLY RS. 1,44,569/-. HE FURTHE R SUBMITTED THAT WHEN THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE CIT(A) , IT IS HELD BY CIT(A) IN PARA NO. 10 OF HIS ORDER THAT AS PER THE SCHEDULE TO FOR M 3CD, THERE IS NO ADDITION ITA NOS. 1417 TO 1419/BANG/2016 PAGE 3 OF 5 TO FIXED ASSETS IN THE PRESENT YEAR. HE SUBMITTED THAT THE RELEVANT FORM 3CD IS AVAILABLE ON PAGES 8 TO 48 OF THE PAPER BOOK AND TH E RELEVANT PAGE IS 47 OF THE PAPER BOOK AND IN THE SAME, THE AUDITOR HAS STATED THAT THERE IS NO ADDITION TO THE FIXED ASSET IN THE PRESENT YEAR BUT HE DRAWN MY ATTENTION TO PAGE NO. 44 OF PAPER BOOK CONTAINING THE DETAILS OF VARIOUS ITEMS OF BALANCE SHEET AND P&L ACCOUNT AND POINTED OUT THAT AS PER THE SAME, IN SL . NO. 14, IT IS STATED THAT THE DEPRECIATION AS PER BOOKS OF ACCOUNT IS RS. 2,46,41 4/- IN THE PRESENT YEAR AND RS. 2,70,846/- IN THE PRECEDING YEAR. HE SUBMITTED THAT ONLY BECAUSE OF A TYPING MISTAKE IN FORM NO. 3CD, THE CLAIM OF THE AS SESSEE CANNOT BE REJECTED. HE ALSO SUBMITTED THAT THE RELEVANT INVOICES IN RES PECT OF PURCHASES OF VARIOUS ITEMS IN THE PRESENT YEAR ARE AVAILABLE ON PAGES 20 TO 29 OF PAPER BOOK AND THEREFORE, THE CLAIM OF THE ASSESSEE SHOULD BE ALLO WED. THE LD. DR OF REVENUE SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. I FIND THAT THE CLAIM OF THE ASSESSEE WAS REJECTED BY THE AUTHORITIES BELOW ON THE BASIS OF FORM 3CD AS PER WHICH THERE IS NO ADDITION TO FIXED ASSET IN THE PRESENT YEAR. BUT AS PER THE P&L ACCOUNT AND BALANCE SHEET DULY AUDITED BY THE SAME AUDITOR, THE AMOUNT OF DEPRECIATION AS PER BOOKS IS RS. 2,46,414/- AND WDV VALUE OF ASSETS AS ON 31.03.2009 IS RS. 7,02,770/- WHICH IS TALLYING WITH THE DEPRECIATION SCHEDULE AVAILABLE ON PAGE NO. 10 OF THE PAPER BOOK. THERE IS NO SUCH COMMENT OF THE AUDITOR THAT THIS P & L ACCOUNT & BALANCE SHEET IS NOT SHOWING THE TRUE & FAIR VIEW OF THE PROFIT/ LOSS AND ASSETS OF THE ASSESSEE . THE RELEVANT INVOICES REGARDING PURCHASE OF VARIOUS ITEMS OF FIXED ASSETS ARE AVAILABLE IN PAPER BOOK. THE PAGE NOS. AND AMOUNTS ARE AS UNDER. SL. NO. PAGE NO. AMOUNT (IN RS.) 1. 20 1,456 2. 21 65,416 3. 22 12,251 4. 23 3,194 5. 24 4,455 6. 25 11,350 ITA NOS. 1417 TO 1419/BANG/2016 PAGE 4 OF 5 7. 26 1,822 8. 27 27,456 9. 28 24,024 10. 29 6,766 TOTAL 1,58,190 6. THE TOTAL OF ADDITION TO FIXED ASSETS IN THE PRE SENT YEAR AS PER DEPRECIATION SCHEDULE ON PAGE 49 OF THE PAPER BOOK IS RS. 194,32 5/-. ALTHOUGH THE AMOUNT IS NOT TALLYING BUT IT CANNOT BE SAID THAT THERE IS NO ADDITION IF THE ASSESSEE CAN ESTABLISH THAT THE CONCERNED ASSET IS ACTUALLY PUT TO USE IN THE PRESENT YEAR. UNDER THESE FACTS, IN MY CONSIDERED OPINION AND IN THE INTEREST OF JUSTICE, THE MATTER SHOULD GO BACK TO THE FILE OF AO FOR FRESH D ECISION AFTER EXAMINING THE COMPLETE FACTS IN THE PRESENT CASE AND IF THE ASSES SEE CAN ESTABLISH THAT VARIOUS ASSETS WERE PURCHASED IN THE PRESENT YEAR A ND THEY WERE PUT TO USE ALSO THEN DEPRECIATION SHOULD BE ALLOWED AS PER LAW . THE AO IS DIRECTED TO PASS NECESSARY ORDER AS PER LAW IN THE LIGHT OF ABO VE DISCUSSION AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO ASSESSEE. G ROUND NO. 4 IS ALLOWED FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE FOR ASSESSMENT YEAR 2009-10 STANDS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- (ARUN KUMAR GARODIA) ACCOUNTANT MEMBER BANGALORE, DATED, THE 19 TH JANUARY, 2018. /MS/ ITA NOS. 1417 TO 1419/BANG/2016 PAGE 5 OF 5 COPY TO: 1. APP ELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.