DCIT, New Delhi V. M/s. Bhushan Steel Ltd., New Delhi

ITA 1487/DEL/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3760 (ITAT-DELHI)
• Duration Of Justice: 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-06-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 07-06-2010
• Assessment Year: 2007-2008
• Appeal Filed On: 06-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAYANT MISHRA
• Keywords: Depreciation

Judgement Text

ITA NO. 1487/DEL/2010 A.Y. 2007-08 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A NEW DELHI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A. NO.1487/DEL/2010 A.Y. : 2007-08 DCIT, CIRCLE-2(1), VS. M/S BHUSHAN STEEL LTD. ROOM NO. 398D, (FORMERLY BHUSHAN STEEL C.R. BUILDING, & STRIPS LTD), F-BLOCK, NEW DELHI 1 ST FLOOR, INTERNATIONAL TRADE TOWER, NEHRU PLACE, NEW DELHI 110 019 (PAN: AAACB 1247M) [APPELLANT] (RESPONDENT) DEPARTMENT BY : SHRI JAYANT MISHRA, C.I.T. (D.R.) ASSESSEE BY : SHRI ASHWANI KUMAR, CA PER SHAMIM YAHYA: AM THE REVENUE IS IN APPEAL BEFORE US AGAINST THE OR DER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DATED 04.1.201 0 PERTAINING TO ASSESSMENT YEAR 2007-08. 2. THE GROUNDS RAISED READ AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE LD. C.I.T.(A) ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS. 79 ,57,45,015/- MADE ON ACCOUNT OF SALES TAX SUBSIDY WHICH WAS CLAIMED AS C APITAL RECEIPTS BY THE ASSESSEE, BUT RIGHTLY TREATED AS REVENUE RECEIPTS BY THE ASSESSING OFFICER. ITA NO. 1487/DEL/2010 A.Y. 2007-08 2 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. C.I.T.(A) ERRED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF DE PRECIATION OF RS. 11,06,029/- MADE ON ACCOUNT OF BUILDING NOT REG ISTERED IN THE NAME OF ASSESSEE. 3. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE R ECORDS. LD. AUTHORISED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT THES E ISSUES STAND COVERED IN FAVOUR OF THE ASSESSEE BY THIS TRIBUNAL DECISION IN ASSESSEES OWN CASE FOR A.Y. 2006-07 IN ITA NO. 1075/DEL/2009 VIDE ORDER DATED 1 3.11.2009. IN THE SAID ORDER THE TRIBUNAL HAD DECIDED THESE ISSUES AS UNDER:- GROUND NO. 1:- 2.1 THE ASSESSEE IS RUNNING A PLANT LOCATED AT SA HIBABAD DISTRICT GHAZIABAD, UP, A NOTIFIED BACKWARD AREA, CONSEQUENT LY ENTITLED TO EXEMPTION UNDER THE PROVISIONS OF THE UP SALES TAX ACT. THE QUANTUM AND PERIOD OF THE SUBSIDY DEPENDANT ON THE POINT OF TIME AT WHICH THE PLANT COMMENCED PRODUCTION AND IS DETERMINABLE AS A PERCENTAGE OF THE FIXED CAPITAL INVESTMENT. IN THE COMPUTATION O F INCOME FILED ALONG WITH THE RETURN OF INCOME, THE AMOUNT OF SUB SIDY AVAILED BY THE COMPANY DURING THE YEAR UNDER CONSIDERATION HA S BEEN TREATED AS CAPITAL SUBSIDY AND CONSEQUENTLY REDUCED FROM T HE TAXABLE INCOME. THE STAND OF THE ASSESSEE BEFORE THE ASSESS ING OFFICER WAS THAT ON SIMILAR FACTS, ASSESSEES CLAIM FOR A.Y. 1 994-95 TO 2001-02, HAS BEEN ALLOWED BY THE ITAT. THE ASSESSING OFFICER , HOWEVER, DISALLOWED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT THE DEPARTMENT HAD NOT ACCEPTED THE CLAIM OF THE ASSESS EE AND THE MATTER WAS SUBJUDICE BEFORE THE HIGH COURT. IN APPE AL, THE C.I.T.(A) ITA NO. 1487/DEL/2010 A.Y. 2007-08 3 ALLOWED THE CLAIM OF THE ASSESSEE BY PLACING RELIAN CE ON EARLIER ORDERS OF THE ITAT IN ASSESSEES OWN CASE AS ALSO THE ORDE RS OF C.I.T.(A) IN ASSESSEES OWN CASE FOR A.Y. 2002-03 TO 2005-06. A GGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 2.2 AFTER HAVING BOTH SIDES WE FIND THAT THE ISSUE STANDS ALREADY CONCLUDED AGAINST THE DEPARTMENT BY THE AFORESAID O RDERS OF THE TRIBUNAL IN ASSESSEES OWN CASE. WE ALSO FIND THAT THE ISSUE IS ALSO COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F SPECIAL BENCH OF THE ITAT IN THE CASE OF DCIT VS. RELIANCE INDUSTRIE S LTD. (2004) 88 ITD 273. THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) ON THE ISSUE IN QUESTION BEING IN CONFORMITY WITH EARLIER ORDERS OF THE TRIBUNAL, WE UPHOLD THE SAME. GROUND NO. 2:- 3.1 THE ASSESSEE CLAIMED DEPRECIATION ON ASSETS, W HICH WERE NOT REGISTERED IN THE ASSESSEES NAME. THERE IS NO DI SPUTE AS TO THE FACT THAT THOSE ASSETS WERE USED IN THE COURSE OF ASSESS EES BUSINESS AND THE C.I.T.(A) FOUND THAT THE ITAT IN THE ASSESSEES OWN CASE FOR ALL THE EARLIER YEARS I.E. 1994-95 TO 2005-06 HAS DECIDED T HE ISSUE IN FAVOUR OF THE ASSESSEE BY FOLLOWING THE DECISION OF THE H ONBLE SUPREME COURT IN THE CASE OF PODDAR CEMENT LTD. 226 ITR 625 AND MYSORE MINERALS LTD. 239 ITR 775. 3.2 AFTER HEARING BOTH THE SIDES WE FIND THAT THE C .IT.(A) HAS NOT COMMITTED ANY ERROR IN FOLLOWING THE DECISIONS OF T HE ITAT IN ITA NO. 1487/DEL/2010 A.Y. 2007-08 4 ASSESSEES OWN CASE WHICH THEMSELVES ARE BASED UPO N THE BINDING PRECEDENT OF THE APEX COURT, AS CITED SUPRA. WE DEC LINE TO INTERFERE. 4. LD. DEPARTMENTAL REPRESENTATIVE AGREED WITH THE PROPOSITION THAT THE ISSUES ARE COVERED BY THE ITAT ORDER IN FAVOUR OF THE ASSESSEE. HOWEVER, HE SUBMITTED THAT DEPARTMENT IS IN APPEAL BEFORE THE HONBLE DELHI HIGH COURT IN THIS REGARD. 5. FOLLOWING THE AFORESAID PRECEDENT, WE AFFIRM THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ON THESE ISSUE S AND DECIDE THE ISSUES IN FAVOUR OF THE ASSESSEE. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07/06/2010 UP ON CONCLUSION OF HEARING. SD/- SD/- [I.P. BANSAL] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE 07/06/2010 SRB COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES