ACIT, CHENNAI V. M/s. Shriram Chits Tamilnadu Pvt. Ltd., CHENNAI

ITA 1740/CHNY/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64605 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 17-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAJI P JACOB IRS
• Assessee Lawyers: ANSHUMAN M OHANTY
• Keywords: Depreciation; Capital expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI V. DURGA RAO, JUDICIAL MEMBER I.T.A. NO. 1740/MDS/2012 ASSESSMENT YEAR : 2009-10 THE ASSISTANT COMMISSIONER OF INCOME-TAX, COMPANY CIRCLE-VI(2), CHENNAI 34. VS. M/S. SHRIRAM CHITS TAMILNADU PVT. LTD., NO.149, GREAMS ROAD, CHENNAI 600 006. PAN AABCS0167N (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SHAJI P. JACOB, IRS, ADDL. CIT RESPONDENT BY : SHRI ANSHUMAN M OHANTY, ADVOCATE DATE OF HEARING : 4 TH DECEMBER, 2012 DATE OF PRONOUNCEMENT : 4 TH DECEMBER, 2012 O R D E R PER DR.O.K.NARAYANAN, VICE-PRESIDENT THIS APPEAL FILED BY THE REVENUE RELATES TO THE ASSESSMENT YEAR 2009-2010. IT IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-V, AT CHENN AI DATED 2 ITA 1740/2012 21.6.2012 AND ARISES OUT OF THE ASSESSMENT COMPLETE D UNDER SEC.143(3) OF THE INCOME-TAX ACT, 1961. 2. THE MAIN ISSUE RAISED BY THE REVENUE IN THE PRES ENT APPEAL IS THAT THE COMMISSIONER OF INCOME-TAX(APPEA LS) HAS ERRED IN DELETING THE DISALLOWANCE MADE BY THE ASSE SSING AUTHORITY AGAINST THE ROYALTY PAID BY THE ASSESSEE AND IN WITHDRAWING DEPRECIATION ALLOWED ON ROYALTY. IT IS THE CASE OF THE REVENUE THAT IN THE LIGHT OF THE AMENDED PROVISIONS OF SEC.32, DEPRECIATION IS ALLOWABLE ON INTANGIBLE ASSETS TREA TING ROYALTY AS A CAPITAL EXPENDITURE, WHICH IN TURN, DOES NOT PERM IT THE EXPENDITURE TO BE TREATED AS REVENUE IN NATURE. 3. WE FIND THAT THE COMMISSIONER OF INCOME-TAX(APPE ALS) HAS ACCEPTED THE CONTENTION OF THE ASSESSEE IN THE LIGHT OF THE DECISION OF THE TRIBUNAL PASSED IN ASSESSEES OWN C ASE FOR THE EARLIER ASSESSMENT YEAR 2008-09 THROUGH ITS ORDER D ATED 30.03.2012 IN ITA NO. 1297/MDS/2011. AS THE JURISD ICTIONAL TRIBUNAL HAS TAKEN A VIEW ON THE ISSUE, IT IS INCUM BENT UPON THE COMMISSIONER OF INCOME-TAX(APPEALS) TO FOLLOW THE S AME, UNLESS THE SAID DECISION IS REVERSED BY ANY OTHER COURT OF LAW. IN THE 3 ITA 1740/2012 PRESENT CASE, AT THE TIME OF DECIDING THE FIRST APP EAL, THE ORDER OF THE TRIBUNAL WAS IN FORCE. IT REMAINS SO EVEN NOW. THEREFORE, IN THESE CIRCUMSTANCES, WE CANNOT SAY THAT THERE IS AN Y INFIRMITY IN THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS ). ACCORDINGLY, THIS APPEAL FILED BY THE REVENUE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON TUESDAY, THE 4 TH OF DECEMBER, 2012 AT CHENNAI. SD/- SD/- (V.DURGA RAO) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED, THE 4 TH DECEMBER, 2012. MPO* COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GF.