Thendiyakavo Koyakutty Hassan , CHENNAI V. ITO Corporate Ward 4(1) , CHENNAI

ITA 1570/CHNY/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 2959 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 8 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-03-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 19-06-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: LAKSHMI CA MR N V BALAJI
• Keywords: Depreciation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: CHENNAI , ! . , ! ' BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NOS.1569 & 1570/CHNY/2017 /ASSESSMENT YEARS: 2008-09 & 2012-13 SHRI THENDIYAKAVO KOYAKUTTY HASSAN, NO.18/3A, MENAMBEDU ROAD, PADI, MANNUPET, CHENNAI-600 050. [PAN: AALPH 1433 M] VS. THE INCOME TAX OFFICER, CORPORATE WARD-4(1), 121, M.G.ROAD, NUNGAMBAKKAM, CHENNAI-600 034. ( ) /APPELLANT) ( *+) /RESPONDENT) ) , / APPELLANT BY : MISS.LAKSHMI, CA FOR MR.N.V.BALAJI, ADV. *+) , /RESPONDENT BY : MR.SRIDHAR DORA, JCIT , /DATE OF HEARING : 06.03.2019 , /DATE OF PRONOUNCEMENT : 06.03.2019 / O R D E R PER GEORGE MATHAN, JUDICIAL MEMBER : THESE ARE TWO APPEALS FILED BY THE ASSESSEE AGAINS T THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-8, CHENNAI, IN ITA NO.232/2015- 16 DATED 13.03.2017 FOR THE AY 2008-09 & ITA NO.163 /2015-16 DATED 13.03.2017 FOR THE AY 2012-13. 2. SHRI SRIDHAR DORA, JCIT, REPRESENTED ON BEHALF O F THE REVENUE AND MISS. LAKSHMI, CA FOR SHRI N.V.BALAJI, ADV., REPRES ENTED ON BEHALF OF THE ASSESSEE. ITA NOS.1569 & 1570 /CHNY/2017 :- 2 -: 3. THE APPEALS FILED BY ASSESSEE ARE DELAYED BY 28 DAYS. IT WAS A SUBMISSION THAT THE DELAY WAS ON ACCOUNT OF CHANGE OF THE AUDITOR AND THE NEW AUDITOR TAKING TIME TO COLLECT ALL THE PAPERS R EQUIRED AND TO UNDERSTAND THE FACTS OF THE ASSESSEES CASE. THE AS SESSEE HAS FILED NECESSARY AFFIDAVIT FOR CONDONATION OF DELAY. THE REVENUE HAS NOT RAISED ANY SERIOUS OBJECTION IN RESPECT OF THE CONDONATION OF DELAY. CONSIDERING THE FACTS OF THE CASE AND THE AFFIDAVIT FILED BY TH E ASSESSEE HAVING NOT BEEN SHOWN TO BE FALSE, THE DELAY OF 28 DAYS IN FIL ING OF THE APPEALS ARE CONDONED AND THE APPEALS DISPOSED OFF ON MERITS. 4. IT WAS SUBMITTED BY THE LD.AR THAT THE COMMON IS SUE IN BOTH THE APPEALS WERE AGAINST THE ACTION OF THE LD.CIT(A) IN NOT GRANTING THE ASSESSEE THE BENEFIT OF DEPRECIATION AT HIGHER RATE OF 30% ON THE CRAWLER CRANES USED BY THE ASSESSEE ON THE GROUND THAT THE SAME WAS NOT REGISTERED WITH RTO. IT WAS SUBMITTED BY THE LD.AR THAT THE ISSUE WAS SQUARELY COVERED BY THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF M/S.SANCO TRANS LTD., REPORTED IN 61 ITD 317, WHEREIN, THE COORDINATE BENCH OF THIS TRIBUNAL HAS HELD THAT THE CRAWLER CRANES ARE ENTITLED TO HIGHER RATE OF DEPRECIATION. 4.1 IN REPLY, THE LD.DR DID NOT RAISE ANY SERIOUS O BJECTION ON THE SAID ISSUE. 4.2 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. ITA NOS.1569 & 1570 /CHNY/2017 :- 3 -: 4.3 AS IT IS NOTICED THAT THE ISSUE IS SQUARELY COV ERED BY THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE O F M/S.SANCO TRANS LTD. (REFERRED TO SUPRA), THE AO IS DIRECTED TO GRANT TH E ASSESSEE THE BENEFIT OF DEPRECIATION AT HIGHER RATE OF 30% IN RESPECT OF CR AWLER CRANES. CONSEQUENTLY, THE APPEAL FILED BY THE ASSESSEE IN I TA NO.1569/CHNY/2017 STANDS ALLOWED AND GROUND NOS.2.1 TO 2.4 OF THE ASS ESSEES APPEAL IN ITA NO.1570/CHNY/2017 STANDS ALLOWED. 5. IN REGARD TO GROUND NOS.3.1 TO 3.4 OF THE ASSESS EES APPEAL IN ITA NO.1570/CHNY/2017 FOR THE AY 2012-13, IT WAS SUBMIT TED BY THE LD.AR THAT THE ISSUE WAS AGAINST THE ACTION OF THE LD.CIT (A) IN UPHOLDING THE DISALLOWANCE MADE BY INVOKING THE PROVISIONS OF SEC .43B OF THE ACT IN RESPECT OF SERVICE TAX NOT PAID. IT WAS SUBMITTED BY THE LD.AR THAT THE SERVICE TAX WAS NOT LIABLE TO BE PAID AND WAS NOT H IT BY THE PROVISIONS OF SEC.43B OF THE ACT. 5.1 IN REPLY, THE LD.DR VEHEMENTLY SUPPORTED THE OR DER OF THE AO AND THE LD.CIT(A). 5.3 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. 5.4 A PERUSAL OF THE ORDER OF THE LD.CIT(A) CLEARLY SHOWS THAT THE ASSESSEE HAS SUBMITTED THE SERVICE TAX WHICH IS PAY ABLE TO THE GOVERNMENT ON RECEIPT OF THE SAME FROM CUSTOMERS. A S THE SERVICE TAX ITA NOS.1569 & 1570 /CHNY/2017 :- 4 -: AMOUNT HAD NOT BEEN RECEIVED FROM THE CUSTOMERS, TH E SAME WAS NOT PAID BY THE ASSESSEE. ADMITTEDLY, THIS IS NOT PERMISSIB LE IN SO FAR AS THE SERVICE TAX IS SHOWN AS PAYABLE IN THE BALANCE SHEE T OF THE ASSESSEE AND CONSEQUENTLY, THE SAME, IF IT NEEDS TO BE CLAIMED A S EXPENDITURE SHOULD BE PAID BEFORE THE DUE DATE OF THE FILING OF THE RE TURN. IN THE PRESENT CASE, AS THE SAME HAS NOT BEEN PAID, WE ARE OF THE VIEW THAT THE AO AND THE LD.CIT(A) WAS RIGHT IN LAW IN HOLDING THAT THE SAME WAS HIT BY THE PROVISIONS OF SEC.43B OF THE ACT. CONSEQUENTLY, GRO UND NOS.3.1 TO 3.4 OF THE ASSESSEES APPEAL IN ITA NO.1570/CHNY/2017 STAN DS DISMISSED. 6. IN REGARD TO GROUND NOS.4.1 & 4.2 OF THE ASSESSE ES APPEAL IN ITA NO.1570/CHNY/2017, IT WAS SUBMITTED BY THE LD.AR TH AT THE ISSUE WAS AGAINST THE ACTION OF THE LD.CIT(A) IN UPHOLDING TH E DISALLOWANCE BY INVOKING THE PROVISIONS OF SEC.40(A)(IA) ON THE PAY MENT OF INTEREST MADE TO M/S.BAJAJ FINANCE LTD. IT WAS A PRAYER THAT THE ISSUE MAY BE RESTORED TO THE FILE OF THE AO FOR RE-ADJUDICATION AS THE AS SESSEE WOULD BE IN A POSITION TO SHOW THAT THE AMOUNT HAS BEEN OFFERED A S INCOME BY THE SAID FINANCIER. 6.1 IN REPLY, THE LD.DR SUBMITTED THAT HE HAD NO OB JECTION IF THE ISSUE IS RESTORED TO THE FILE OF THE AO TO GIVE AN OPPORTUNI TY TO THE ASSESSEE TO SHOW THAT THE INTERESTS WERE OFFERED AS INCOME BY T HE FINANCER AND TAXES HAVE BEEN PAID THEREON. 6.2 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. ITA NOS.1569 & 1570 /CHNY/2017 :- 5 -: 6.3 IN VIEW OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF M/S.COCA COLA CO. LTD., THE ISSUES ARE RESTORED TO THE FILE OF THE AO IN RESPECT OF THE DISALLOWANCE MADE U/S.40(A)(IA) IN R ESPECT OF THE INTEREST PAID TO M/S.BAJAJ FINANCE LTD., TO GRANT THE ASSESS EE ADEQUATE OPPORTUNITY TO PROVE THAT THE INTEREST HAS BEEN OFFERED BY M/S. BAJAJ FINANCE LTD., AS INCOME FOR THE RELEVANT AY AND DUE TAXES HAVE BEEN PAID ON THE SAME. CONSEQUENTLY, GROUND NOS.4.1 & 4.2 OF THE ASSESSEE S APPEAL ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES. 7. IN REGARD TO GROUND NOS.5.1 TO 5.4 OF THE ASSESS EES APPEAL IN ITA NO.1570/CHNY/2017, IT WAS SUBMITTED BY THE LD.AR TH AT THE ISSUE WAS AGAINST THE ACTION OF THE LD.CIT(A) IN UPHOLDING TH E DISALLOWANCE MADE BY INVOKING THE PROVISIONS OF SEC.40A[3] OF THE ACT IN RESPECT OF CASH PAYMENT TO THE EXTENT OF RS.56,62,190/-. IT WAS SU BMITTED BY THE LD.AR THAT THE DISALLOWANCE HAS BEEN MADE ON THE BASIS OF CASH BOOK MAINTAINED AT THE HEAD OFFICE OF THE ASSESSEE. IT WAS A SUBMISSION THAT THE VOUCHERS AND PAYMENTS DETAILS MAINTAINED AT THE SITE OFFICE WHERE THE ASSESSEES EQUIPMENTS WERE BEING USED CLEARLY SHOWE D THAT NONE OF THE PAYMENTS EXCEEDED THE PRESCRIBED LIMIT U/S.40A[3]. IT WAS A SUBMISSION THAT THE ASSESSEE MAY BE GRANTED AN OPPORTUNITY TO PRODUCE THE EVIDENCE REPRESENTING THE SITE REGISTER AND THE VOUCHERS BEF ORE THE AO. 7.1 IN REPLY, THE LD.DR DID NOT RAISE ANY OBJECTION IN RESPECT OF GRANTING AN OPPORTUNITY TO THE ASSESSEE TO PRODUCE THE EVIDE NCE BEFORE THE AO. 7.2 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. ITA NOS.1569 & 1570 /CHNY/2017 :- 6 -: 7.3 CONSIDERING THE FACTS IN THE PRESENT CASE, THE ISSUE OF DISALLOWANCE U/S.40A[3] OF THE ACT IS RESTORED TO THE FILE OF TH E AO FOR RE-ADJUDICATION AFTER GRANTING THE ASSESSEE ADEQUATE OPPORTUNITY TO PRODUCE THE EVIDENCE TO SHOW THAT THE PAYMENTS WERE MADE AT SITE AND THE SAME WERE BELOW THE THRESHOLD LIMIT OF SEC.40A[3]. CONSEQUENTLY, G ROUND NOS.5.1 TO 5.4 OF THE ASSESSEES APPEAL ARE PARTLY ALLOWED FOR STATIS TICAL PURPOSES. 8. IN THE RESULT, THE APPEALS FILED BY THE ASSESSE E IN ITA NO.1569/CHNY/2017 IS ALLOWED AND IN ITA NO.1570/CHN Y/2017 IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE 6 TH DAY OF MARCH, 2019, IN CHENNAI. SD/- SD/- ( ) ( S. JAYARAMAN ) ! /ACCOUNTANT MEMBER ( ) (GEORGE MATHAN) ! /JUDICIAL MEMBER /CHENNAI, 3 /DATED: 6 TH MARCH, 2019. TLN , *45 65 /COPY TO: 1. ) /APPELLANT 4. 7 /CIT 2. *+) /RESPONDENT 5. 5 * /DR 3. 7 ( ) /CIT(A) 6. /GF