M/s. Vijaynirman Co. P. Ltd, Hyd, Hyderabad V. ACIT, Circle-3(3), Hyderabad

ITA 1448/HYD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66448 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 11-08-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V SRINIVAS
• Assessee Lawyers: A V RAGHURAM
• Keywords: Depreciation; Additional depreciation; Retrospective amendment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO.1448/HYD/2011- ASSTT. YEAR: 2008-09 AND ITA NO.116/HYD/2011- ASST. YEAR 2007-08 M/S. VIJAY NIRMAN & CO., PVT. LTD., HYDERABAD. .... APPELLANT PAN:AAACV6001 E VS. ACIT, CIR-3(3),, RESPONDENT HYDERABAD. APPELLANT BY : SHRI A.V. RAGHU RAM RESPONDENT BY : SRI V. SRINIVAS DATE OF HEARING : 17-09-2012 DATE OF PRONOUNCEMENT : 16-11 -2012 ORDER PER SAKTIJIT DEY, J.M.: THESE TWO APPEALS FILED BY THE ASSESSEE ARE DIRECTE D AGAINST SEPARATE ORDERS OF CIT (A)-IV, HYDERABAD AND THEY P ERTAIN TO THE ASSESSMENT YEARS 2008-09 AND 2007-08. SINCE COMMON ISSUES ARE INVOLVED IN THESE TWO APPEALS, THESE ARE TAKEN UP T OGETHER AND DISPOSED OF BY THIS COMBINED ORDER FOR THE SAKE OF CONVENIENCE. 2 ITA NOS. 1448 AND116 OF 2011 M/S.VIJAY NIRMAN & CO. PVT. LTD., HYD. 2. SINCE FACTS ARE SIMILAR AND IDENTICAL IN THESE TWO APPEALS, FOR THE SAKE OF BREVITY, WE DEAL WITH THE FACTS AS MENTIONED IN ITA NO. 116/HYD/2011.THOUGH THE ASSESSEE HAS RAISED AS MANY AS FIVE COMMON GROU NDS IN THIS APPEAL, GROUNDS NO.1 AND 5 BEING GENERAL IN NATURE, NEEDS N O ADJUDICATION. 3. IN GROUND NOS. 2 AND 3, THE ASSESSEE HAS CHALLE NGED THE DISALLOWANCE MADE U/S 40(A)(IA) FOR NON DEDUCTION OF TAX AT SOUR CE ON INTEREST ON MOBILISATION ADVANCE. 4. BRIEFLY THE FACTS ARE THE ASSESSEE IS ENGAGED IN THE BUSINESS OF EXECUTING CIVIL CONTRACT WORKS. IN THE IMPUGNED ASSESSMENT Y EAR, IT FILED A RETURN DECLARING A TOTAL INCOME OF RS.2,76,70,458/-. IN C OURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE NOTICED THAT DURING THE R ELEVANT FINANCIAL YEAR, THE ASSESSEE HAS CLAIMED THE FOLLOWING EXPENDITURE WITH OUT DEDUCTING TAX AT SOURCE:- DESCRIPTION AMOUNT (RS.) INTEREST ON MOBILISATION ADVANCE TO SOME 7,77,132 ENTERPRISE FINANCE CHARGES TO SREI INFRASTRUCTURE 6,51,336 LAND RENT PAID TO ROYAL LEGEND 3,00,000 ------------ TOTAL 17,28,465 -------------- THE AO THEREFORE DISALLOWED THE AMOUNT AND ADDED IT BACK TO THE TOTAL INCOME BY INVOKING THE PROVISIONS CONTAINED U/S 40(A)(IA) OF THE ACT. THE ASSESSEE CHALLENGED THE ADDITION BY FILING AN APPEAL BEFORE THE CIT (A). 5. IN COURSE OF HEARING BEFORE THE CIT (A), THE ASS ESSEE CONTENDED THAT THE TDS PROVISIONS ARE NOT ATTRACTED SINCE THE ASSESSEE HAS ACTUALLY NOT MADE ANY PAYMENTS TOWARDS INTEREST ON MOBILISATION ADVANCE B Y THE CONCERNED DEPARTMENTS WHILE DISBURSING THE AMOUNT TO THE ASSE SSEE HAVE THEMSELVES RETAINED THE AMOUNT TOWARDS INTEREST. THEREFORE, S UCH PAYMENT OF INTEREST WAS NOT UNDER CONTROL OF THE ASSESSEE. SIMILARLY, IN C ASE OF PAYMENT TO THE FINANCE 3 ITA NOS. 1448 AND116 OF 2011 M/S.VIJAY NIRMAN & CO. PVT. LTD., HYD. COMPANIES IN THE FORM OF EMIS AS THE INTEREST COMPO NENT INVOLVED THEREIN WAS NOT KNOWN TO THE ASSESSEE, NO DEDUCTION OF TAX AT S OURCE COULD BE MADE. SO FAR AS THE LAND RENT IS CONCERNED, THE ASSESSEE CONTEND ED THAT IT WAS RECOVERED FROM THE PAYMENT MADE TO THE ASSESSEE AND THEREFOR E IT WAS NOT UNDER THE ASSESSEES CONTROL FOR MAKING ANY TDS. THE ASSESSEE RELYING UPON THE DECISIONS OF ITAT IN THE CASES OF (I) GOODWIN FINANCE HOLDIN GS PVT. LTD (ITA NO.923/HYD/2009 DATED 8-10-2009 (II) LILURAM & SONS (ITA NO.703/HYD/2009 DATED 14-5-2010 AND (III) TECUMSEH PRODUCTS PVT. LT D (13 SOT 489) CONTENDED THAT SINCE THE ASSESSEE WAS NOT IN CONTROL OF THE P AYMENT AND IT ONLY RECEIVED NET AMOUNT AFTER DEDUCTION OF THE AMOUNTS CLAIMED A S EXPENDITURE, THERE IS NO LIABILITY ON THE ASSESSEE TO DEDUCT TAX AND THEREFO RE SECTION 40(A)((IA) OF THE ACT COULD NOT BE APPLIED. 6. THE CIT (A) AFTER CONSIDERING THE CONTENTIONS OF THE ASSESSEE AND EXAMINING THE DECISIONS RELIED UPON BY THE ASSESSEE WAS OF THE VIEW THAT THE ASSESSEES CASE STANDS ON A DIFFERENT FOOTING SINCE IT CANNOT BE SAID THAT IT WAS NOT POSSIBLE FOR THE ASSESSEE TO HAVE CONTROL OVER THE PAYMENTS CONCERNED. THE CIT (A) HELD THAT ONLY BECAUSE OF THE TERMS OF THE A GREEMENT THE CONCERNED PARTIES WERE ALLOWED TO RETAIN INTEREST, FINANCE CH ARGES AND LAND RENT WITHOUT GIVING THE ASSESSEE AN OPPORTUNITY TO MAKE THE PAYM ENT. THE CIT (A) RELYING UPON A DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. IDEA CELLULAR LIMITED (189 TAXMAN 118) OR (325 ITR 148) HELD THAT SINCE RETENTION OF THE PAYMENT MADE TOWARDS INTEREST, FINANCE CHARGES, REN T BY THE CONCERNED PARTIES WAS BY VIRTUE OF CONSCIOUS ARRANGEMENT OF TERMS AND CONDITIONS IN THE AGREEMENT BETWEEN THE ASSESSEE AND THE CONCERNED PA RTIES, IT CANNOT BE SAID THAT THE ASSESSEE HAD NO CONTROL OVER THE PAYMENT A ND AS A RESULT OF WHICH IT COULD NOT DEDUCT TAX. ON THE AFORESAID CONCLUSION, THE CIT (A) SUSTAINED THE ADDITION OF RS.17,28,465/-. 7. THE LEARNED AR SUBMITTED BEFORE US THAT SINCE TH E ASSESSEE WAS PAID ONLY THE NET AMOUNTS, IT HAD NO OCCASION TO DEDUCT TAXES ON THE AMOUNTS RETAINED BY THE CLIENTS. IN THIS CONTEXT, THE LEAR NED AR RELIED UPON THE SAME DECISION OF THE ITAT, HYDERABAD BENCH WHICH WERE CIT ED BEFORE THE CIT (A). THE LEARNED AR ALTERNATIVELY ARGUED THAT EVEN ASSUMING T HAT THE PAYMENTS WERE MADE BY THE ASSESSEE WITHOUT DEDUCTING TAXES BUT SI NCE IT WAS PAID DURING THE 4 ITA NOS. 1448 AND116 OF 2011 M/S.VIJAY NIRMAN & CO. PVT. LTD., HYD. RELEVANT FINANCIAL YEAR AND NOTHING REMAINED PAYABL E THEREFORE NO DISALLOWANCE COULD BE MADE U/S 40(A)(IA) IN VIEW OF THE ORDER PA SSED BY THE VIZAG SPECIAL BENCH IN THE CASE OF MERLYN SHIPPING LIMITED VS. A DDL. CIT(136 ITD 23). 8. THE LEARNED DR, ON THE OTHER HAND, STRONGLY SUPP ORTED THE ORDERS OF THE LOWER AUTHORITIES. 9. WE HAVE HEARD RIVAL SUBMISSIONS OF THE PARTIES A ND PERUSED THE MATERIAL ON RECORD. WE HAVE ALSO APPLIED OUR MIND TO THE DE CISIONS CITED BEFORE US. IT IS THE CONTENTION OF THE ASSESSEE BEFORE THE LOWER AUT HORITIES THAT SINCE THE ASSESSEE HAD NO CONTROL OVER THE PAYMENTS TOWARDS I NTEREST ON MOBILISATION ADVANCE, FINANCE CHARGES AND LAND RENT AS THE CONC ERNED PARTIES RETAINED THE AMOUNT FROM THE PAYMENTS MADE BY THEM TO THE ASSESS EE, THEREFORE NO TAX COULD BE DEDUCTED AT SOURCE. HOWEVER, THIS ARGUMEN T OF THE ASSESSEE IS NOT ACCEPTABLE IN VIEW OF THE DECISIONS OF THE HONBLE DELHI HIGH COURT IN CIT VS. IDEAL CELLULAR LTD. (SUPRA). THE HONBLE DELHI HI GH COURT IN THE AFORESAID CASE RELIED UPON A DECISION OF THE ITAT, COCHIN BENCH IN CASE OF VODAFONE ESSAR CELLULAR LIMITED (2009) (317 ITR (AT) 234 WHEREIN T HE COCHIN BENCH OF THE TRIBUNAL HELD IN THE FOLLOWING MANNER:- THE NEXT QUESTION IS WHETHER THE COMMISSION/BROKERA GE ALLOWED BY THE ASSESSEE-COMPANY AT THE STAGE OF RAISING THE INVOIC E IS EQUIVALENT TO PAYING OF COMMISSION/BROKERAGE TO THE DISTRIBUTORS. THE ASSESSEE HAS ALWAYS RAISED A CONTENTION, THAT TOO IN THE LIGHT O F THE JUDICIAL PRONOUNCEMENTS INCLUDING THAT OF M.S. HAMMED (2001) 249 ITR 186(KER) THAT THE ASSESSEE-COMPANY HAD NO OCCASION TO DEDUCT TAX AT SOURCE AS THE ASSESSEE COMPANY WAS NOT MAKING ANY P AYMENT TO THE DISTRIBUTORS OR CREDITING THE ACCOUNT OF THE DISTRI BUTORS FOR ANY SERVICES RENDERED TO IT. BUT THAT OCCASION WAS REMOVED BY7 T HE ASSESSEE ITSELF BY CONSCIOUS WORDINGS OF THE TERMS OF THE AGREEMENT. THE ASSESSEE- COMPANY CAN COLLECT THE NET SALE PROCEEDS ALONG WIT H TDS ELEMENT FROM THE DISTRIBUTORS WHILE DISTRIBUTING THE PREPAID PRO DUCTS TO THE DISTRIBUTORS. 5 ITA NOS. 1448 AND116 OF 2011 M/S.VIJAY NIRMAN & CO. PVT. LTD., HYD. THE HONBLE DELHI HIGH COURT APPROVED THE AFORESAID VIEW OF THE COCHIN BENCH IN THE CASE OF IDEA CELLULAR LIMITED (SUPRA). IN THE AFORESAID VIEW OF THE MATTER, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CI T (A) IN SUSTAINING THE ADDITION OF RS.17,28,465/-. HOWEVER, SO FAR AS THE ALTER NATE PLEA OF THE ASSESSEE, THE LEARNED AR TO THE EFFECT THAT SINCE THE PAYMENTS WE RE MADE DURING THE RELEVANT PREVIOUS YEAR, NO DEDUCTION COULD BE MADE U/S 40(A) (IA) OF THE ACT. IN VIEW OF THE SPECIAL BENCH IN THE CASE OF MERLYN SHIPPING LIM ITED (136 ITD 23) WE ACCEPT THE SAME AND REMIT THE MATTER BACK TO THE AO TO VERI FY AND FIND OUT WHETHER THE PAYMENTS WERE MADE DURING THE RELEVANT FINANCIAL YE AR. IF ULTIMATELY IT IS FOUND THAT PAYMENTS WERE MADE DURING THE RELEVANT FINANCI AL YEAR AND NOTHING REMAINED PAYABLE, NO DISALLOWANCE COULD BE MADE U/S 40(A)(IA) OF THE ACT. 10. THE OTHER ISSUE AS RAISED IN GROUND NO.4 RELATE S TO DISALLOWANCE OF CLAIM OF ADDITIONAL DEPRECIATION. DURING THE ASSESSMENT PROCEEDINGS, THE AO NOTICED THAT THE ASSESSEE HAS CLAIMED ADDITIONAL DEPRECIATI ON U/S 32(1)(IIA) OF THE ACT ON PLANT AND MACHINERY TO THE TUNE OF RS.2,01,88,485/- . THE AO BY INTERPRETING THE PROVISIONS CONTAINED IN SECTION 32(1)(IIA) WAS OF THE VIEW THAT THE PRIMARY CONDITION FOR CLAIMING ADDITIONAL DEPRECIATION IS, THE ASSESSEE SHOULD BE ENGAGED IN THE MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING. SINCE THE ASSESSEE WAS ENGAGED IN EXECUTING CIVIL CONSTRUCTION WORKS LIKE FLYOVERS AND BRIDGES, THEREFORE IT CANNOT BE SAID THAT THE ASSESSEE IS ENGAGED IN M ANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING. IN THIS CONTEXT, THE AO RELIED UPON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. N.C. B UDHIRAJA (NC) AND CO. (1993) (204 ITR 412). ON THE AFORESAID ANALYSIS, T HE AO DISALLOWED THE CLAIM OF ADDITIONAL DEPRECIATION AND ADDED IT TO THE TOTAL I NCOME OF THE ASSESSEE. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE CIT (A) . IN COURSE OF HEARING BEFORE THE CIT (A) THE ASSESSEE SUBMITTED THAT THE MACHINE RY PURCHASED DURING THE RELEVANT PREVIOUS YEAR HAD BEEN USED TO MANUFACTURE PRE-CAST CONCRETE BLOCKS AND OTHER ITEMS USED IN LAYING OF BRIDGES ETC., WHI CH IS TRANSPORTED TO THE SITE FOR LAYING. THE ASSESSEE CONTENDED THAT THE RATIO OF T HE DECISION IN THE CASE OF N.C. BUDHIRAJA (SUPRA) WAS RENDERED IN THE CONTEXT AS TO WHETHER THE ACTIVITY OF CONSTRUCTION OF BRIDGES AMOUNTS TO MANUFACTURE OR P RODUCING OF ARTICLE OR THING. HOWEVER, THE ASSESSEE IS NOT JUST A BUILDER OF THE BRIDGES. RATHER IT HAS USED ITS MACHINERY FOR MANUFACTURING PRE-CAST CONCRETE SLABS AND OTHER CONCRETE ITEMS, 6 ITA NOS. 1448 AND116 OF 2011 M/S.VIJAY NIRMAN & CO. PVT. LTD., HYD. WHICH AFTER BEING MANUFACTURED ARE TRANSPORTED TO T HE SITES WHERE FLYOVERS OR BRIDGES ETC., ARE TO BE CONSTRUCTED AND THE MANUFAC TURED MATERIAL IS USED THEREIN SUCH PROCESSES. THE ASSESSEE FURTHER SUBM ITTED THAT THE WORD MANUFACTURE IS NOT DEFINED IN SECTION 32(1)(IIA), MANUFACTURING ACTIVITY HAS BEEN DEFINED IN SECTION 2(29 BA) OF THE ACT HAS TO BE CONSIDERED FOR ANALYZING WHETHER THE ADDITIONAL DEPRECIATION IS ALLOWABLE ON THE MACHINERY USED TO MANUFACTURE AND ERECT GIRDERS IN THE BRIDGE LAYING PROCESS. THE ASSESSEE CONTENDED THAT SINCE THE MACHINERY IS BEING USED BY THE COMPANY FOR MANUFACTURING OF VARIOUS TYPES OF GIRDERS WHICH WER E ULTIMATELY USED FOR CONSTRUCTION OF THE BRIDGES, IT HAS TO BE HELD THAT THE ASSESSEE IS ENGAGED IN MANUFACTURING OR PRODUCTION OF ARTICLE OR THING SO AS TO CLAIM ADDITIONAL DEPRECIATION. THE CIT (A) AFTER CONSIDERING THE CON TENTIONS RAISED BY THE ASSESSEE HELD THAT THE ASSESSEES BUSINESS IS NOT MANUFACTURING OF CONCRETE GIRDERS ETC. THE ASSESSEE IS ENGAGED IN CIVIL CONS TRUCTION WORKS OF BRIDGES OR FLYOVERS AND THE MANUFACTURING OF GIRDERS PRE-CAST CONCRETE SLABS AND OTHER CONCRETE ITEMS IN THE ENTIRE BUSINESS OPERATION OF CONSTRUCTION OF BRIDGES. THE CIT (A) OBSERVING THAT THE HONBLE APEX COURT IN TH E CASE OF NC BUDHIRAJA (SUPRA) HAS HELD THAT CONSTRUCTION OF BRIDGES DOES NOT INVOLVE ANY MANUFACTURING ACTIVITY, SUSTAINED THE DISALLOWANCE OF CLAIM OF AD DITIONAL DEPRECIATION CLAIMED BY THE ASSESSEE. 11. THE LEARNED AR SUBMITTED BEFORE US THAT DURING T HE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE, FOR THE PURPOSE OF CON STRUCTING FLYOVERS AND BRIDGES HAD PURCHASED MACHINERY BY MAKING HUGE INVESTMENTS AND BY USING SUCH MACHINERY MANUFACTURED GIRDERS AND OTHER CONCRETE I TEMS WHICH WERE TRANSPORTED TO THE SITES, FLYOVERS AND BRIDGES ARE ERECTED THERE. SINCE THE MACHINERIES WERE USED FOR THE PURPOSE OF MANUFACTUR ING THE AFORESAID ITEMS WHICH ARE INTERMEDIARY PRODUCTS IN THE PROCESS OF CONSTRUCTION OF BRIDGES, THE ASSESSEE IS ENTITLED FOR ADDITIONAL DEPRECIATION. THE LEARNED AR SUBMITTED THAT THE RATIO LAID DOWN IN THE JUDGMENT OF HONBLE SUPRE ME COURT IN THE CASE OF NC BUDHIRAJA (SUPRA) IS NOT APPLICABLE TO THE FACTS OF THE ASSESSEES CASE SINCE THE ASSESSEE IS NOT ENGAGED IN MERE CONSTRUCTION OF BRI DGES BUT IT IS ALSO INVOLVED IN MANUFACTURE OF PRE-CAST CONCRETE SLABS. THE LEARN ED AR SUBMITTED THAT BY EXTENSIVELY USING THE MACHINERY, THE ASSESSEE IS EX ECUTING THE PROJECTS AND 7 ITA NOS. 1448 AND116 OF 2011 M/S.VIJAY NIRMAN & CO. PVT. LTD., HYD. USING MACHINERY AS DEMANDED BY ITS BUSINESS. IN THI S CONTEXT, IT WAS SUBMITTED THAT THE OLDEN TIMES BRIDGES, DAMS, ETC., WERE PRE DOMINANTLY MAN MADE, ON ACCOUNT OF TECHNOLOGICAL DEVELOPMENTS, TIME PERIOD AVAILABLE FOR COMPLETION OF PROJECTS, AVAILABILITY OF LABOUR ETC., MOST OF THE BUILDERS ARE RELYING EXTENSIVELY ON MACHINERY FOR EXECUTING HEAVY WORKS LIKE BUILDIN GS, DAMS, FLYOVERS, BRIDGES ETC. THE EXPRESSION CIVIL CONTRACTOR IS THE WORD WHICH IS LOOSELY USED FOR DESCRIBING THE ABOVE ACTIVITY. THE LEARNED AR FURT HER SUBMITTED THAT WHILE MANUAL WORK IS THERE TO SOME EXTENT, THE PREDOMINAN T PART OF BUILDING PRE-CAST CONCRETE SLABS AND OTHER CONCRETE MATERIAL IS ONLY THROUGH MACHINERY AND TO THE EXTENT OF THE WORK CARRIED ON BY THE ASSESSEE WITH THE MACHINERY, IT IS A MANUFACTURING ACTIVITY AND THE ASSESSEE HAS TO BE C ONSIDERED AS ENGAGED IN MANUFACTURING ACTIVITY TO THAT EXTENT. THE LEARNE D AR REFERRING TO THE DEFINITION OF THE WORD BUSINESS AS DEFINED U/S 2(13) OF THE ACT SUBMITTED THOUGH THE ASSESSEE IS CARRYING ON BUSINESS OF A CIVIL CONTRAC TOR IN BROADER SENSE, SO FAR AS BUILDING GIRDERS, PRE-CAST CONCRETE SLABS, ETC., IT IS A MANUFACTURER OF THE SAID ITEMS IT WAS SUBMITTED THAT THE MANUFACTURING OF T HE SAID ITEMS IS AN INTERMEDIARY STAGE IN THE WHOLE PROCESS OF EXECUTIN G THE CIVIL CONTRACT WORK. THE LEARNED AR REFERRING TO THE WORD MANUFACTURE A S DEFINED U/S 2(29BA) OF THE ACT SUBMITTED, THOUGH IT WAS INTRODUCED BY FINA NCE (NO.2) ACT, 2009 WITH RETROSPECTIVE EFFECT FROM 1-4-2009, BUT IT NEVERTHE LESS HAS BEARING ON THE ISSUE ON HAND SINCE THE ASSESSEE IS MANUFACTURING GIRDERS AND PRE-CAST CONCRETE SLABS ETC. THE LEARNED AR SUBMITTED THAT SINCE THE ASSES SEE IS MANUFACTURING GIRDERS, PRE-CAST CONCRETE SLABS ETC., WHICH WERE U LTIMATELY USED FOR CONSTRUCTION OF BRIDGES AND FLYOVERS, THEREFORE IT IS ENTITLED T O CLAIM ADDITIONAL DEPRECIATION AS PER THE PROVISIONS OF SECTION 32(1)(1)(IIA) OF THE ACT. IN SUPPORT OF SUCH CONTENTIONS, THE LEARNED AR RELIED UPON THE FOLLOWIN G JUDGMENTS:- (I) YFC PROJECTS (P) LTD. VS. DCIT 46 DTR 496 (D EL) (II) DCIT VS. NV EXPORTS (P) LTD. (49 SOT 534 (KOL) (III)CIT VS. TEXMO PRECISION CASTINGS (321 ITR 481 (MAD). 12. THE LEARNED DR SUBMITTED THAT THE ASSESSEES BU SINESS IS EXECUTION OF CIVIL CONSTRUCTIONS WORKS AND NOT MANUFACTURE OF PRE-CAST CONCRETE SLABS AND GIRDERS ETC. THE LEARNED DR SUBMITTED THAT SINCE THE ULTIM ATE PRODUCT CONSTRUCTED BY THE ASSESSEE IS A BRIDGE OR A FLYOVER, IT CANNOT BE SAID TO BE IN THE BUSINESS OF 8 ITA NOS. 1448 AND116 OF 2011 M/S.VIJAY NIRMAN & CO. PVT. LTD., HYD. MANUFACTURING OR PRODUCING AN ARTICLE OR THING. IN VIEW OF RATIO LAID DOWN IN THE CASE OF NC BUDHIRAJA (SUPRA) WHICH WAS SUBSEQUENTLY APPROVED BY THE HONBLE SUPREME COURT IN THE CASE OF BUILDERS ASSOCIATION OF INDIA VS. UNION OF INDIA AND OTHERS (209 ITR 877). 13. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. AFTER EXAMINING THE PROVISIONS CONTAINED U/S 32(1)(I IA) OF THE ACT, IT IS CLEAR THAT ADDITIONAL DEPRECIATION IS TO BE ALLOWED IN CASE O F A NEW MACHINERY OR PLANT WHICH HAS BEEN ACQUIRED OR INSTALLED AFTER 31 ST MARCH, 2005 BY AN ASSESSEE ENGAGED IN THE MANUFACTURE OR PRODUCTION OF ANY ART ICLE OR THING. AS IS EVIDENT FROM THE FACTS ON RECORD THE ASSESSEE IS NOT IN THE BUSINESS OF MANUFACTURING OR PRODUCTION OF ANY ARTICLE OR THING BUT IS ENGAGED I N THE BUSINESS OF EXECUTING CIVIL CONSTRUCTION WORKS LIKE BUILDING OF BRIDGES A ND FLYOVERS ETC. THE PRE-CAST CONCRETE SLABS AND GIRDERS STATED TO BE MANUFACTURE D BY THE ASSESSEE ARE NOT SOLD AS IT IS BY THE ASSESSEE, BUT ARE UTILISED IN THE CONSTRUCTION WORK. THE ASSESSEE IS NEITHER ENGAGED IN THE BUSINESS OF MANU FACTURING AND SALE OF THESE CONCRETE SLABS AND GIRDERS NOR ARE THEY SALEABLE CO MMERCIAL COMMODITIES. AS PER THE ASSESSEES OWN VERSION, THESE PRE-CAST SLABS AN D GIRDERS ARE UTILISED IN LAYING OF THE FLYOVERS AND BRIDGES WHICH IS THE ULT IMATE PRODUCT CONSTRUCTED BY THE ASSESSEE AS PER THE TERMS OF THE CONTRACT. SINCE CONSTRUCTION OF FLYOVERS AND BRIDGES CANNOT BE HELD TO BE MANUFACTURE OR PRODUCT ION OF AN ARTICLE OR THING AS PER THE DECISION OF THE HONBLE SUPREME COURT IN CA SE OF N.C. BUDHIRAJA (SUPRA) WHICH WAS AGAIN FOLLOWED BY THE HONBLE SUPREME COU RT IN THE CASE OF BUILDERS ASSOCIATION (SUPRA), THE ASSESSEE CANNOT BE ENTITLED FOR ADDITIONAL DEPRECIATION. THE DECISIONS RELIED UPON BY THE ASSESSEE ARE NOT A PPLICABLE TO THE FACTS OF THE PRESENT CASE. IN CASE OF CIT VS. TEXMO PRECISION C ASTINGS (SUPRA), THE ASSESSEE HAS CLAIMED ADDITIONAL DEPRECIATION ON WIND MILLS. THE TRIBUNAL AFTER FINDING THAT THE ASSESSEE WAS ALSO ENGAGED IN THE BUSINESS OF GE NERATION AND SALE OF POWER EARLIER, ALLOWED ADDITIONAL DEPRECIATION WHICH WAS UPHELD BY THE HONBLE HIGH COURT. THE DECISIONS IN CASES OF YFC PRODUCTS PVT. LTD., VS. DCIT AND DCIT VS. N.V. EXPORTS PVT. LTD. (SUPRA) ARE FACTUALLY DIS TINGUISHABLE FROM THE FACTS INVOLVED IN THE PRESENT APPEAL. IN AFORESAID VIEW OF THE MATTER, RESPECTFULLY FOLLOWING THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASES OF N.C. BUDHIRAJA AND BUILDERS ASSOCIATION (SUPRA), WE UPHOL D THE ORDER OF THE LOWER 9 ITA NOS. 1448 AND116 OF 2011 M/S.VIJAY NIRMAN & CO. PVT. LTD., HYD. AUTHORITIES. THE COMMON GROUND RAISED BY THE ASSESS EE FOR THE YEARS UNDER CONSIDERATION IS DISMISSED. 14. IN THE RESULT, BOTH THE APPEALS FILED BY THE AS SESSEE ARE TREATED AS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 16-11-2012. SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER SD/- (SAKTIJIT DEY) JUDICIAL MEMBER HYDERABAD, DATED THE 16 TH NOVEMBER, 2012. COPY TO:- 1) C/O S/SRI A.V. RAGHU RAM & K. VASANT KUMAR ADVO CATES, 610, 6 TH FLOOR, BABHUKHAN ESTATE, BASHEERBACH, HYDERABAD. 2)ACIT, CIR-3(3), HYDERABAD. 3) THE CIT (A)-IV, HYDERABAD. 4) THE CIT CONCERNED, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDERABA D. JMR*