Boulevard Servicess Pvt. Ltd., Kolkata V. ACIT, Circle-2(1), Kolkata, Kolkata

ITA 1742/KOL/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 3328 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 31-08-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: G MALLIKARJUNA; SAURABH KUMARADDL CITSR
• Assessee Lawyers: A K TIBREWAL
• Keywords: Business income; Depreciation; Additional evidence; Question of law; Tax effect; Revised return
• Section: 43B; 143(3); 14A; 80IB

Judgement Text

ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 1 IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH C KOL KATA [BEFORE HONBLE SHRI S.S.GODARA, JM & DR.A.L.SAIN I, AM ] ITA NO.1741/KOL/2016 ASSESSMENT YEARS : 2008-09 M/S BOULEVARD SERVICES PVT. LTD. -VERSUS- A. C.I.T., CIRCLE-2(1), KOLKATA KOLKATA (PAN: AABCB0666P) (APPELLANT) (RESPONDENT) ITA NO.1577/KOL/2017 ASSESSMENT YEAR : 2008-09 A.C.I.T., CIRCLE-2(1), -VERSUS- M/S BOULEVARD SERVICES PVT.LTD .KOLKATA KOLKATA (PAN: AABCB0666P) (APPELLANT) (RESPONDENT) ITA NOS.2070/KOL/2016 ASSESSMENT YEAR : 2008-09 A.C.I.T., CIRCLE-2(1), -VERSUS- M/S BOULEVARD SERVICES PVT.LTD KOLKATA KOLKATA (PAN: AABCB0666P) (APPELLANT) (RESPONDENT) ITA NOS.1742&1743/KOL/2016 ASSESSMENT YEARS: 2009-10 & 2010-11 M/S BOULEVARD SERVICES PVT. LTD. -VERSUS- A. C.I.T., CIRCLE-2(1), KOLKATA KOLKATA (PAN: AABCB0666P) (APPELLANT) (RESPONDENT) ITA NOS.1752& 1753/KOL/2016 ASSESSMENT YEAR : 2009-10 & 2010-11 A.C.I.T., CIRCLE-2(1), -VERSUS- M/S BOULEVARD SERVICES PVT.LTD KOLKATA KOLKATA (PAN: AABCB0666P) (APPELLANT) (RESPONDENT) ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 2 FOR THE DEPARTMENT: SHRI G.MALLIKARJUNA, DR & SHRI SAURABH KUMAR,ADDL.CIT,SR.DR FOR THE ASSESSEE: SHRI A.K.TIBREWAL, FCA DATE OF HEARING : 12.07.2018. DATE OF PRONOUNCEMENT : 24.08.2018. ORDER PER S.S.GODARA, JM: THE INSTANT BATCH IS OF SEVEN CASES. WE START WITH FIRST A.Y.2008-09. THE ASSESSEE AND REVENUE HAVE FILED THEIR CROSS APPEAL S ITA 1741/KOL/2016 AND ITA NO.1577/KOL/2017 AGAINST THE CIT(A)-11, KOLKATAS O RDER DATED 02.08.2016 PASSED IN APPEAL NO.ITA NO.517/CIT(A)-11/CIR.-8/R&T/14-15/KOL INVOLVING PROCEEDINGS U/S 143(3) OF THE INCOME TAX ACT, 1961 (THE ACT) . TH E REVENUES LATTER APPEAL ITA NO.1577/KOL/2017 ARISES FROM THE VERY CIT(A)S ORDE R DATED 02.08.2016 IN APPEAL NO. ITA NO.517/CIT(A)-11/CIR.-8/R&T/14-15/KOL INVOL VING THE SAME NATURE OF ASSESSMENT PROCEEDINGS. NEXT ASSESSMENT YEAR 2009-1 0 INVOLVES ASSESSEES AND REVENUES CROSS APPEALS ARISING AGAINST THE CIT(A)- 11, KOLKATAS ORDER DATED 30.06.2016 PASSED IN APPEAL NO.518/CIT(A)-11/14-15/ CIR.8/R&T/KOL INVOLVING REGULAR ASSESSMENT PROCEEDINGS. THE NEXT ASSESSMENT YEAR IS A.Y.2010-11 CONTAINS ASSESSEES AND REVENUES CROSS APPEALS ITA NO.1743/ KOL/2016 AND 1753/KOL/2016 DIRECTED AGAINST THE VERY SAME CIT(A)-11, KOLKATAS ORDER DATED 30.06.2016 PASSED IN 519/CIT(A)-11/14-15/CIR.8/R&T/KOL INVOLVING SIMILAR REGULAR ASSESSMENT PROCEEDINGS. HEARD BOTH THE PARTIES. CASE FILES PERUSED. WE PROCEED ASSESSMENT YEAR WISE FOR THE SAKE OF CON VENIENCE AND BREVITY. A.Y.2008-09 :- 2. WE COME TO ASSESSEES APPEAL ITA NO.1741/KOL/201 6. ITS FIRST SUBSTANTIVE GROUND PLEADS THAT THE CIT(A) HAS ERRED IN LAW AS W ELL AS ON FACTS IN DISALLOWING LEASE ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 3 TAX OF RS.8,76,283/- U/S 43B OF THE ACT. THE LD. CO UNSEL STATES VERY FAIRLY THAT THE TAX PAYER DOES NOT WISH TO PRESS ITS INSTANT FIRST SUBS TANTIVE GROUND. THE SAME IS THEREFORE DECLINED AS NOT PRESSED. 3. THE ASSESSEES SECOND SUBSTANTIVE GROUND CHALLEN GES CORRECTNESS OF BOTH THE LOWER AUTHORITIES ASSESSING ITS INTEREST INCOME OF RS.36,03,129/- DERIVED FROM ITS ASSOCIATE COMPANIES TO BE ASSESSABLE AS INCOME FROM OTHER SOURCES THAN AS BUSINESS INCOME; IN THE COURSE OF ASSESSMENT AND THE LOWER A PPELLATE PROCEEDINGS. PAGE-5 PARA- 3.7 REVEALS THAT THE CIT(A) AFFIRMS THE ASSESSMENT FINDINGS TO THIS EFFECT THAT THE IMPUGNED INTEREST INCOME TAXABLE AS INCOME FROM OTH ER SOURCES. LEARNED COUNSEL VEHEMENTLY CONTENDS DURING THE COURSE OF HEARING TH AT THE ASSESSEE HAD ADVANCED MONIES IN QUESTION TO ITS GROUP SISTER CONCERNS DUR ING THE COURSE OF REGULAR BUSINESS ONLY CULMINATING IN THE INTEREST INCOME UNDER ISSUE WHICH IS TO BE TAXED UNDER THE HEAD BUSINESS INCOME ONLY. HE QUOTES HONBLE APEX C OURTS DECISION IN C.A.74/2007 DATED 16.09.2015 CIT VS DALMIA PROMOTERS & DEVELOPE RS (P)LTD. WE FIND NO FORCE IN THE TAX PAYERS INSTANT SUBSTANTIVE GRIEVANCE. IT EM ERGES FIRST OF ALL THAT THERE IS NO MATERIAL ON RECORD INDICATING SUCH INTEREST TO BE A SSESSEES BUSINESS ACTIVITY AS PER ITS OBJECT CLAUSES. THERE IS NO EVIDENCE BEFORE US AS T O WHETHER THE TRANSACTION IN QUESTION HAD MADE IN TRADING HEAD OR NOT. WE MAKE IT CLEAR T HAT THE HONBLE GUJARAT HIGH COURT IN (2006) 283 ITR 402 NIRMA INDUSTRIES VS DCIT HOLD S THAT INTEREST ON TRADING TRANSACTION FORMS VERY MUCH PART OF REVENUE ACTIVIT Y. NO SUCH FACTS HOWEVER ARE FORTHCOMING FROM THE INSTANT CASE FILE. ASSESSEES RELIANCE ON HONBLE APEX COURTS DECISION HEREINABOVE IS ALSO WITHOUT ANY MERIT. THE SAID APPEAL BEFORE THEIR LORDSHIPS AROSE FROM HONBLE DELHI HIGH COURTS DECISION IN C IT VS DALMIA PROMOTERS DEVELOPERS PVT. LTD. [2006] 281 ITR 346 (DELHI) WHE REIN THE CONCERNED ASSESSEE HAD VERY MUCH DEMONSTRATED IN PARA-5 THAT THE INTEREST INCOME IN ISSUE WAS AN INTEGRAL PART OF ITS BUSINESS ACTIVITY SINCE HAVING DIRECT LINK W ITH REAL ESTATE BUSINESS REPRESENTING MARGIN MONEY AND CHANGE OF LAND USE. WE MAKE IT CLE AR THAT THERE ARE NO SUCH FACTS EMANATING FROM THE CASE RECORDS. WE THEREFORE UPHOL D BOTH THE LOWER AUTHORITIES ACTION TREATING THE ASSESSEES INTEREST INCOME AS I NCOME FROM OTHER SOURCES. WE ALSO ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 4 DIRECT THE ASSESSING OFFICER TO APPLY NETTING FORM ULA IN ASSESSMENT OF THE IMPUGNED INTEREST INCOME AS PER LAW AFTER AFFORDING ADEQUATE OPPORTUNITY OF HEARING TO THE TAX PAYER. 4. THE ASSESSEES NEXT SUBSTANTIVE GRIEVANCE AS PLE ADED IN ITS 3 RD TO 5 TH SUBSTANTIVE GROUND IS THAT THE CIT(A) HAS ERRED IN DISMISSING I TS ADDITIONAL GROUND RAISED WITH REGARD TO SUO MOTO DISALLOWANCE OF INTEREST AND FEE OF RS.6,40,58,418/- MADE INADVERTENTLY WHILE FILING THE RETURN FOR THE IMPUG NED ASSESSMENT YEAR MAINLY ON THE GROUND THAT NO SUCH ISSUE AROSE FROM THE ASSESSMENT ORDER DATED 31.12.2010. BOTH THE LEARNED REPRESENTATIVES ARE IN UNISON DURING THE CO URSE OF HEARING THAT THE CIT(A) HAS FOLLOWED HIS DETAILED DISCUSSION IN LATTER TWO ASSE SSMENT YEARS FINDINGS. WE ARE THEN TAKEN TO THE LOWER APPELLATE ORDER IN THE SAID LATT ER TWO ASSESSMENT YEARS. THE SAID FINDINGS ALSO REJECT THE ASSESSEES PLEA AGAINST ID ENTICAL SUO MOTO ACTION COMPUTING DISALLOWANCE/INTEREST OF RS.85794,105/- IN A.Y.2009 -10 AND RS.98926318 IN A.Y.2010-11 REGARDING INTEREST ON LOANS FOR THE PUR POSE OF ITS BUSINESS. THE REVENUES VEHEMENT CONTENTION BEFORE US IS THAT SUC H AN ADDITIONAL GROUND CANNOT BE ALLOWED TO BE RAISED IN LOWER APPELLATE PROCEEDINGS SINCE THERE IS NO DISALLOWANCE IN ASSESSMENT ORDER TO THIS EFFECT. WE FIND NO MERIT I N THE INSTANT ARGUMENTS RAISED AT REVENUES BEHEST. WE FIRST OF ALL MAKE IT CLEAR THA T THE TAX PAYERS CLAIM IS THAT THE AMOUNT IN QUESTION HAD BEEN WRONGLY CAPITALISED AS COST OF INVESTMENT OF UNQUOTED SHARES AS PER ACCOUNTING STANDARD (AS-16). IT IS AN ADMITTED FACT THAT THE SAME HAS NOT BEEN ENTERTAINED AT ALL BY THE CIT(A) SO AS TO CULM INATE INTO ANY DETAILED DISCUSSION ON MERITS. THE QUESTION AS TO WHETHER AN ASSESSEE C AN RAISE SUCH ADDITIONAL GROUND FOR THE FIRST TIME DURING THE COURSE OF LOWER APPELLATE PROCEEDINGS OR NOT HAS ALREADY BEEN ADJUDICATED BY HONBLE GUJARAT HIGH COURT IN CIT VS MITESH IMPEX 270 CTR 66 AS FOLLOWS : 5. HAVING HEARD LEARNED COUNSEL FOR THE PARTIES AN D HAVING PERUSED DOCUMENTS ON RECORD, WE DO NOT SEE ANY ERROR IN THE VIEW OF T HE TRIBUNAL. THE QUESTION OF DISALLOWANCE UNDER SECTION 14A OF THE ACT HAS BEEN EXAMINED ON THE BASIS OF MATERIALS ON RECORD. THE TRIBUNAL FOUND THAT THE AS SESSEES INTEREST FREE FUNDS ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 5 FAR EXCEEDED ITS INTEREST FREE INVESTMENTS. THE TRI BUNAL RELIED ON THE DECISIONS OF THIS COURT IN CASE OF THIS VERY ASSESSEE CONCERNING SIMI LAR ISSUES IN THE LATER ASSESSMENT YEARS, AGAINST WHICH WE ARE INFORMED TH AT THE SPECIAL LEAVE PETITION HAS BEEN DISMISSED. 6. REGARDING A CLAIM CONTRARY TO THE DISCLOSURES IN THE RETURN, THE TRIBUNAL RELIED ON THE DECISION OF SUPREME COURT IN THE CASE OF THE NATIONAL THERMAL POWER (SUPRA) TO OBSERVE THAT THE PURPOSE THAT THE PURPOSE OF ASSESSMENT IS TO TAX REAL INCOME. THIS COURT TAKING NOTE OF THE DECI SIONS OF SUPREME COURT IN CASE OF GOETZE INDIA LIMITED V. CIT, REPORTED IN 284 ITR 323 AND NATIONAL THERMAL POWER (SUPRA) A IN CASE OF MITESH IMPEX HAD OBSERVE D AS UNDER: 38. IT THUS BECOMES CLEAR THAT THE DECISION OF THE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. COMMISSIONER OF INCOME-TAX (SUPRA) IS CONFINED TO THE POWERS OF THE ASSESSING OFFICER AND ACCEPTING A CLA IM WITHOUT REVISED RETURN. THIS IS WHAT SUPREME COURT OBSERVED IN THE SAID JUDGMEN T WHILE DISTINGUISHING THE IN THE CASE OF NATIONAL THERMAL POWER CO. LTD. VS. COM MISSIONER OF INCOME-TAXAX (SUPRA) AND THAT IS HOW VARIOUS HIGH COURTS HAVE V IEWED THE DICTUM OF THE DECISIONS IN THE CASE OF GOETZE (INDIA) LTD. VS. C OMMISSIONER OF INCOME-TAX (SUPRA). WHEN IT COMES TO THE POWER OF APPELLATE CO MMISSIONER OR HE TRIBUNAL, THE COURTS HAVE RECOGNISED THEIR JURISDICTION TO E NTERTAIN A NEW GROUND OR A LEGAL CONTENTION. A GROUND WOULD HAVE A REFERENCE T O AN ARGUMENT TOUCHING A QUESTION OF FACT OR A QUESTION OF OR MIXED QUESTION OF LAW OR FACTS. A LEGAL CONTENTION WOULD ORDINARILY BE A PURE QUESTION OF L AW WITHOUT RAISING ANY DISPUTE ABOUT THE FACTS. NOT ONLY SUCH ADDITIONAL GROUND OR CONTENTION, THE COURTS HAVE ALSO, AS NOTED ABOVE, RECOGNIZED THE PO WERS OF THE APPELLATE COMMISSIONER AND THE TRIBUNAL TO ENTERTAIN A NEW CL AIM FOR THE FIRST TIME THOUGH NOT MADE BEFORE THE ASSESSING OFFICER. INCOME TAX P ROCEEDINGS ARE NOT STRICTLY SPEAKING ADVERSARIAL IN NATURE AND THE INTENTION OF THE REVENUE WOULD BE TO TAX REAL INCOME. 39. THIS IS PRIMARILY ON THE PREMISE THAT IF A CLAI M THOUGH AVAILABLE IN LAW IS NOT. MADE EITHER INADVERTENTLY OR ON ACCOUNT OF ERRONEO US BELIEF OF COMPLEX LEGAL POSITION, SUCH CLAIM CANNOT BE SHUT OUT FOR ALL TIM ES TO COME, MERELY BECAUSE IT IS RAISED FOR THE FIRST TIME BEFORE THE APPELLATE AUTH ORITY WITHOUT RESORTING TO REVISING THE RETURN BEFORE THE ASSESSING OFFICER. 40. THEREFORE, ANY GROUND, LEGAL CONTENTION OR EVEN A CLAIM WOULD BE PERMISSIBLE TO BE RAISED FOR THE FIRST TIME BEFORE THE APPELLAT E AUTHORITY OR THE TRIBUNAL WHEN FACTS NECESSARY TO EXAMINE SUCH GROUND, CONTENTION OR CLAIM ARE ALREADY ON RECORD. IN SUCH A CASE THE SITUATION WOULD BE AKIN TO ALLOWING A PURE QUESTION OF LAW TO BE RAISED AT ANY STAGE OF THE PROCEEDINGS. T HIS IS PRECISELY WHAT HAS ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 6 HAPPENED IN THE PRESENT CASE. THE APPELLATE COMMISS IONER AND THE TRIBUNAL DID NOT NEED TO NOR DID THEY TRAVEL BEYOND THE MATERIAL S ALREADY ON RECORD, IN ORDER TO EXAMINE THE CLAIMS OF THE ASSESSES FOR DEDUCTION S UNDER SECTION 80IB OF THE ACT. 5. WE RELY ON THE ABOVE DETAILED DISCUSSION TO CONC LUDE THAT THE CIT(A) AS WELL AS THIS TRIBUNAL MAY ENTERTAIN SUCH AN ADDITIONAL GROU ND RAISING BOTH QUESTIONS OF LAW OR FACT OR MIXED QUESTION OF BOTH FOR THE FIRST TIME A S PER HONBLE APEX COURTS DECISION IN NATIONAL THERMAL POWER CO. (SUPRA). WE REITERATE TH AT INCOME TAX PROCEEDINGS ARE NOT STRICTLY ADVERSARIAL IN NATURE WHEREIN THE REVENUE S AIM IS TAX THE REAL INCOME THAN THAT BASED ON OMISSIONS AND COMMISSIONS. WE AGAIN Q UOTE HONBLE GUJARAT HIGH COURTS DECISION THAT IF A CLAIM IS AVAILABLE FOR A N ASSESSEE TO BE RAISED UNDER THE LAW; IS NOT MADE EITHER INADVERTENTLY OR ON ACCOUNT OF E RRONEOUS PLEA, THE SAME CANNOT BE ALLOWED TO BE SHUT DOWN FOR ALL TIMES MERELY BECAUS E IT IS RAISED FOR THE FIRST TIME BEFORE AN APPELLATE AUTHORITY AND THAT TOO, WITHOUT FILING A REVISED RETURN BEFORE THE ASSESSING OFFICER. WE ALSO KEEP IN MIND THE HONBLE APEX COURTS DECISION IN 283 ITR 329 MAKING IT CLEAR THAT POWERS OF APPELLATE AUTHOR ITIES UNDER THE ACT FOR ADMITTING SUCH ADDITIONAL GROUNDS ARE NOT IMPINGED UPON BY TH E SAME IN ABSENCE OF A REVISED RETURN FILED BEFORE THE ASSESSING OFFICER. WE ACCOR DINGLY ACCEPT ASSESSEES INSTANT THREE SUBSTANTIVE GROUNDS IN PRINCIPLE AND REMIT TH E ISSUE BACK TO THE ASSESSING OFFICER FOR AFRESH ADJUDICATION AS PER LAW WITHOUT COMMENTING ANYTHING ON MERITS OF THE ISSUE. THIS MAIN APPEAL ITA NO.1741/KOL/2016 IS PARTLY ACCEPTED FOR STATISTICAL PURPOSES. 6. THE REVENUES APPEAL ITA NO.1577/KOL/2017 HAS R AISED TWO SUBSTANTIVE GROUNDS. THE FORMER ONE PLEADS THAT THE CIT(A) HAS ERRED IN LAW AS WELL AS ON FACTS IN DELETING DISALLOWANCE OF BROKERAGE EXPENSES OF RS.1 2,05,562/- AFTER ADMITTING FRESH ADDITIONAL EVIDENCE IN VIOLATION OF RULE 46A OF THE INCOME TAX RULES. THE CIT(A)FINDINGS UNDER CHALLENGE QUA THE INSTANT SUB STANTIVE GROUND READ AS UNDER :- ASSESSEE HAD CLAIMED EXPENSES OF RS.L,30.169/- ON ACCOUNT OF BROKERAGE PAYMENT TO SHRI RAJESH KUMAR BAID AND ANOTHER AMOUN T OF RS.10.75,393/- AS ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 7 BROKERAGE PAYMENT TO CITY INFO PROPERTY SERVICES (P ) LTD. ASSESSING OFFICER HAS HELD THAT THESE PAYMENTS WERE MADE FOR LEASING OUT OF. SPACE AT BIPL OMEGA BUILDING. AS BUILDING IS NOT OWNED BY THE ASSESSEE, THE BROKERAGE AMOUNT OF RS.L2,05,S62/- HAS BEEN DISALLOWED, AS NOT CONNECTE D WITH BUSINESS. APPELLANT HAS EXPLAINED THAT BROKERAGE CLAIMED BY ASSESSEE IS ONLY IN RESPECT OF FURNITURE AND FIXTURES LET OUT BY APPELLANT HAS PRODUCED COPI ES OF CONFIRMATION DATED 19/07/2016 FROM SRI RAJESH KUMAR BAID AND CONFIRMAT ION DT. NIL FROM GTYINFO PROPERTY SERVICES PVT. LTD. IN VIEW OF THE ABOVE, A DDITION OF RS.12,05,562/- IS DELETED. 7. IT EMERGES FROM A PERUSAL OF THE ABOVE EXTRACTED FINDINGS THAT THE CIT(A) HAS NOWHERE ADMITTED ANY ADDITIONAL EVIDENCE AS CLAIMED AT THE REVENUES BEHEST. HE HAS ACCEPTED ASSESSEES CLAIM WHOSE DETAILS ARE AVAILAB LE ALREADY ON RECORD THAT BROKERAGE IN QUESTION IS ONLY IN RESPECT OF FURNITURE AND FIX TURES LET OUT MUCH EARLIER AS SUPPORTED BY CONFIRMATION FROM THE PAYEES CONCERNED. WE FIND NO MERIT IN REVENUES INSTANT FORMER SUBSTANTIVE GROUND THEREFORE. 8. THE REVENUES LATTER SUBSTANTIVE GROUND SEEKS TO RESTORE THE ASSESSING OFFICERS ACTION DISALLOWING DEPRECIATION OF RS.3,7 6,80,957/- AS DELETED DURING THE COURSE OF THE LOWER APPELLATE PROCEEDINGS WITH THE FOLLOWING DETAILED DISCUSSION :- GROUND OF APPEAL NOS.7(A) & (B)- ASSESSING OFFICER-HAS DISALLOWED RS.3,76,80,957/- O UT OF DEPRECIATION OF SOME LET OUT FURNITURE AND FITTINGS HOLDING THAT ADDITIO N TO 'THE RESPECTIVE BLOCK OF FIXED ASSETS WAS MADE ON THE LAST DAY OF THE FINANCIAL YE AR. IT IS FURTHER HELD THAT ASSESSEE FAILED TO FURNISH ANY EVIDENCE REGARDING P UTTING THESE ASSETS TO USE IN THE CURRENT FINANCIAL YEAR. IN APPEAL PROCEEDINGS, ASSE SSEE HAS SUBMITTED THAT THESE ASSETS HAVE BEEN GIVEN ON HIRE SINCE SEPTEMBER, 200 7 AND RENT IS RECEIVED ON THESE FURNITURE AND PLANT & MACHINERY. FURNITURE & OTHER PLANT & MACHINERIES ( A.C.S. ETC.) WERE CONTINUOUSLY BEING PROVIDED AS PE R AGREEMENT WITH THE CLIENTS. DURING THIS PERIOD THEIR ACCOUNTING WAS BEING DONE UNDER THE HEAD 'CAPITAL ';WORK-IN-PROGRESS' AND ON 31.03.2008 COMPLETED ITE MS WERE TRANSFERRED TO THE ASSETS ACCOUNT. ASSESSEE HAS FURNISHED SUPPORTING E VIDENCES, LIKE BILLS ETC. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AND THE SUBMISSIONS OF THE ASSESSEE. AS THE FURNITURE AND PLANT & MACHINERIES WERE ACQUIRED AND FITTED AT CLIENT'S PREMISES, THESE WERE ALREADY PUT TO USE. R ENTAL RECEIPTS OF THE ASSESSEE HAS INCREASED OVER TIME AS NEW FURNITURE AND PLANT & MACHINERIES WERE PUT IN PLACE. SIMPLY BECAUSE THESE ASSETS WERE TRANSFERRED FROM 'WORK-IN-PROGRESS' TO ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 8 'ASSETS' ACCOUNT ON THE LAST DAY OF THE YEAR, WOULD NOT DEPRIVE THE ASSESSEE OF THEIR LAWFUL CLAIM OF DEPRECIATION. HENCE, ADDITION OF RS.3,76,80,957/- IS DELETED. 9. WE HAVE HEARD LEARNED DEPARTMENTAL REPRESENTATIV E VEHEMENTLY CONTENDING THAT THE CIT(A) HAS ERRED IN LAW AS WELL AS ON FACT S IN DELETING THE IMPUGNED DEPRECIATION DISALLOWANCE. HIS CASE IS THAT THE ASS ETS IN ISSUE WERE NOWHERE PUT TO USE IN THE F.Y.2007-08. IT EMERGES THAT THIS ASSESSEE I S A COMPANY ENGAGED IN BUSINESS OF HIRING CHARGES DERIVED FROM LETTING OUT PLANT AND M ACHINERY AS WELL AS FURNITURE AND FIXTURES TO DIFFERENT PARTIES. IT HAS CLEARLY PROVE D TO HAVE GIVEN THESE ASSETS FOR HIRE SINCE SEPTEMBER, 2007 IN LIEU OF CHARGING RENT. THE RELEVANT AGREEMENT TO THIS EFFECT ALREADY STANDS CONSIDERED BY THE CIT(A). THE REVENU ES MAIN GRIEVANCE THAT THE ASSETS HAD NOT BEEN PUT TO USE IN F.Y.2007-08 HAS N O MERIT THEREFORE. ITS LAST PLEA THAT THE ASSESSEE HAS MADE A BOOK ENTRY IS OF NO CONSEQU ENCE AS IT HAS COME ON RECORD THAT THESE ASSETS HAD BEEN MERELY TRANSFERRED FROM WORK IN PROGRESS TO ASSETS ACCOUNT ON THE LAST DAY OF THE YEAR ALSO DOES NOT HELP THE REVENUES CAUSE SINCE GOING AGAINST THE BASIC FACT OF THE VERY ASSETS PUT TO USE IN SEP TEMBER, 2007. THE REVENUES INSTANT LATTER GRIEVANCE AS WELL AS THE MAIN APPEAL ITA NO. 1577/KOL/2017 STANDS DECLINED. 10. THE REVENUES SECOND APPEAL ITA NO.2070/KOL/201 6 RAISES SOLE SUBSTANTIVE GRIEVANCE CHALLENGING THE CIT(A)S FINDINGS REVERSI NG THE ASSESSING OFFICERS ACTION DISALLOWING INTEREST EXPENDITURE U/ S 36(1)(III) OF THE ACT. ITS VEHEMENT CONTENTION DURING THE COURSE OF HEARING THAT THE ASSESSEE PUTT ING ITS ASSETS TO USE ON THE LAST DAY OF THE FINANCIAL YEAR 2007-08 AS EMANATED IN THE TAX A UDIT REPORT. BOTH THE REPRESENTATIVES ARE AD IDEM THAT WE HAVE ALSO REJEC TED THE VERY PLEA IN THE FOREGOING PARAGRAPHS. THE REVENUES INSTANT GRIEVANCE AS WELL AS THE MAIN APPEAL ITA NO.2070/KOL/2016 FAILS THEREFORE. 11. WE NOW COME TO A.Y.2009-10. THE ASSESSEES APPE AL IS ITA NO.1742/KOL/2016. ITS SOLE SUBSTANTIVE GRIEVANCE PL EADED IN THREE SUBSTANTIVE GROUNDS RAISED IN THE APPEAL IS THAT THE CIT(A) HAS ERRED I N LAW AS WELL AS ON FACTS IN NOT ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 9 ADMITTING ITS ADDITIONAL GROUND WITH REGARD TO SUO MOTO DISALLOWANCE OF INTEREST OF RS.857942105 INADVERTENTLY MADE UNDER MISCONCEPTION OF LAW WHILE FILING RETURN IN THE IMPUGNED ASSESSMENT YEAR. BOTH THE LEARNED REPR ESENTATIVES INFORM US THAT WE HAVE ALREADY ACCEPTED IDENTICAL GRIEVANCE IN A.Y.20 08-09 THEREBY RESTORING THE ISSUE BACK TO THE ASSESSING OFFICER. WE FOLLOW OUR SAID D ETAILED DISCUSSION MUTADIS MUTANDIS TO ADOPT THE VERY COURSE OF ACTION HEREIN AS WELL. THE ASSESSEES GRIEVANCE RAISED IN THE INSTANT APPEAL IS RESTORED BACK TO TH E ASSESSING OFFICER FOR DETAILED ADJUDICATION IN THE CONSEQUENTIAL PROCEEDINGS. THIS APPEAL ITA NO.1742/KOL/2016 IS ACCEPTED FOR STATISTICAL PURPOSES. 12. THE REVENUES APPEAL ITA NO.1752/KOL/2016 SEEKS TO REVIVE SECTION 14 R.W. RULE 8 DISALLOWANCE OF RS.15,00,160/- MADE BY THE A O AND DELETED IN THE LOWER APPELLATE PROCEEDINGS. SUFFICE TO SAY, THE TAX EFF ECT INVOLVED IS LESS THAN RS.20 LAKHS AS PER THE CBDT LATEST CIRCULAR PRESCRIBING THE SAI D MINIMUM THRESHOLD LIMIT. THIS REVENUES APPEAL ITA NO.1752/KOL/2016 IS DISMISSED FOR INVOLVING LOWER THAN THE PRESCRIBED MINIMUM TAX EFFECT. 13. WE ARE NOW LEFT WITH ASSESSEES APPEAL ITA NO.1 743/KOL/2016 RAISING TWO SUBSTANTIVE GROUNDS IN CHALLENGING THE CIT(A) IN NO T ADMITTING THIS ADDITIONAL GROUND CHALLENGING CORRECTNESS OF SUO MOTO INTEREST DISAL LOWANCE OF RS.9,89,26,318/-; IS ACCEPTED FOR STATISTICAL PURPOSES IN VIEW OF OUR FO REGOING DETAILED DISCUSSION IN ITA NO.2070/KOL/2016 IN A.Y.2008-09 DEALING WITH CORRES PONDING ISSUE. THE REVENUES CROSS APPEAL ITA NO.1753/KOL/2016 SEEKING TO REVIVE SECTION 14A R.W. RULE 8D DISALLOWANCE OF RS.30,00,160/- IS DISMISSED FOR INV OLVING LOWER THAN THE PRESCRIBED MINIMUM TAX EFFECT OF RS.20 LAKHS AS PER CBDT CIRCU LAR NO.3/2018 ISSUED ON 11/07/2018. ITA NO1741TO 1743/KOL/2016 & 1577/KOL/2017, 2070/KO L/2016&1752-1753/KOL/2016 M/S. BOULEVARD SERVICES PVT. LTD. A.Y.2008-09 , 2009-10 & 2010-11 10 14. THUS, ASSESSEES APPEAL ITA NO.1741/KOL/2016 IS PARTLY ACCEPTED FOR STATISTICAL PURPOSES AND ITA NOS.1742&1743/KOL/2016 ARE ACCEPTE D FOR STATISTICAL PURPOSES AND REVENUES APPEALS ITA NO.1577/KOL/2017, ITA NO.2070 /KOL/2016, ITA NOS.1752&1753/KOL/2016 ARE DISMISSED. O RDER PRONOUNCED IN THE COURT ON 24/08/2018. SD/- SD/- [DR.A.L.SAINI ] [ S.S.GODARA ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 24/08/2018. [RG SR.PS] COPY OF THE ORDER FORWARDED TO: 1.M/S BOULEVARD SERVICES PVT. LTD., GROUND FLOOR, B UILDING BETA, BENGAL INTELLIGENT PARK, BLOCK EP & GP SECTOR-V, SALT LAKE ELECTRONICS COMPLEX, KOLKATA-700091. 2. I.T.O., WARD-26(1), KOLKATA. 3. C.I.T.(A)-7, KOLKATA 4. C.I.T-9, KOLKATA 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER, SENIOR PRIVATE SECRETARY HEAD OF OFFICE/D.D.O, ITAT KOLKATA BENCHES