M/s. Investment and Precision Casting Ltd., Rajkot V. The Jt.CIT(OSD)Circle-1, Bhavnagar

ITA 1824/AHD/2012

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 9391 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 4 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 11-01-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 21-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M K PATEL AR SHRI PRASOON KABR
• Assessee Lawyers: VS AHD INVESTMENT
• Keywords: Depreciation
• Section: 143(3); 32

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD , , BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER SL. NOS. ITA NO(S) ASSESSMENT YEAR (S) APPEAL(S) BY APPELLANT VS. RESPONDENT APPELLANT RESPONDENT 1. 1824/AHD/2012 2004-05 INVESTMENT & PRECISION CASTING LTD. NARI ROAD BHAVNAGAR PAN : AAAC14650D JT.CIT (OSD) CIRCLE-1, BHAVNAGAR 2. 1047/AHD/2013 2004-05 -DO- ASSESSEE ACIT CIRCLE-1 BHAVNAGAR 3. 1048/AHD/2013 2005-06 -DO-ASSESSEE JT.CIT RANGE-1 BHAVNAGAR !' / APPELLANT BY : SHRI M.K. PATEL, AR $ !%' / RESPONDENT BY : SHRI PRASOON KABRA, SR.DR &'%( / DATE OF HEARING 11/01/2017 )*+,%( / DATE OF PRONOUNCEMENT 19/01/2017 / O R D E R PER BENCH: THE ABOVE CAPTIONED APPEALS FILED BY THE ASSESSEE RELEVANT TO ASSESSMENT YEARS (AYS) 2004-05 & 2005-06. AS THE C OMMON ISSUES ARE ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 2 - INVOLVED, ALL THE THREE APPEALS ARE DISPOSED OF BY WAY OF A COMMON ORDER FOR CONVENIENCE AND BREVITY. ITA NO.1824/AHD/2012 AY 2004-05 ASSESSEES APPEA L 2. THIS APPEAL ARISES OUT OF THE ORDER OF THE COMMI SSIONER OF INCOME TAX(APPEALS)-XX, AHMEDABAD [CIT(A) IN SHORT] DATED 11/06/2012 ARISING OUT OF THE ORDER OF THE ASSESSING OFFICER ( AO) UNDER SECTION 143(3) READ WITH SECTION 254 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'THE ACT') DATED 26/12/2011. 3. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. THAT THE LEARNED CIT(A)-XX, AHMEDABAD HAS GRIEV OUSLY ERRED IN CONFIRMING THE DISALLOWANCE OF THE APPELLANTS CLAIM U/S 35(I)(IV) AMOUNTING TO RS.76,84,180. 2. THAT THE LEARNED CIT(A)-XX, AHMEDABAD HS GRIEVO USLY ERRED IN FAILING TO APPRECIATE THE TRUE IMPORT OF THE SUBMIS SIONS MADE BY THE APPELLANT IN THIS REGARD. 4. THE FACTS CONCERNING GROUND NO.1 ARE THAT THE AS SESSEE-COMPANY IS ENGAGED IN MANUFACTURING OF FERROUS AND NON-FERROUS ALLOYS INVESTMENT CASTING, ETC. LOST WAX PROCESS METHOD. THE ASSESSE E FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS.6,07,78,080/- F OR AY 2004-05. THE RETURN WAS SUBJECTED TO SCRUTINY ASSESSMENT. TH E AO INTER-ALIA OBSERVED THAT THE ASSESSEE HAS CLAIMED RESEARCH AND DEVELOPMENT ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 3 - (R&D) EXPENDITURE OF RS.76,84,180/- UNDER SECTION 3 5(1)(IV) OF THE ACT. THE ASSESSEE CLAIMED THAT IT HAS PURCHASED AND INST ALLED VARIOUS MACHINES TO CARRY OUT RESEARCH AND DEVELOPMENT (R&D ) ACTIVITIES DURING THE YEAR AND ACCORDINGLY CLAIMED THE IMPUGN ED AMOUNT AS R&D EXPENDITURE. THE AO RECORDED THE STATEMENT OF ONE OF ITS EMPLOYEES MR.PITHWA AND NOTED THAT MACHINERY ACQUIRED BY THE ASSESSEE IS FOUND TO BE RELATED TO THE PRODUCTION PROCESS AND IS NOT UTI LIZED IN RESEARCH ACTIVITY. THE AO NOTED AT PAGE NO.17 OF THE ASSESS MENT ORDER THAT THE MATTER HAS BEEN REFERRED TO THE RELEVANT AUTHORITY AND DECISION ON THE MATTER IS AWAITED. PENDING THE OUTCOME OF THE REFE RENCE TO THE PRESCRIBED AUTHORITY, THE ASSESSMENT ORDER WAS PASSED DISALLOW ING THE CLAIM UNDER SECTION 35 OF THE ACT BY HOLDING THE EXPENDITURE CL AIMED ON PURCHASE OF MACHINERY TO BE NOT DIRECTLY RELATED TO R&D ACTIVIT Y. THUS, ASSESSEES CLAIM OF RS.76,84,180/- UNDER SECTION 35 OF THE ACT WAS DENIED TO ASSESSEE. 5. THE MATTER WAS CARRIED BEFORE THE CIT(A) AND THE REAFTER TO THE ITAT, AHMEDABAD BY THE ASSESSEE IN ITA NO.798/AHD/2 008 AND ORS. THE ASSESSEE INVITED THE ATTENTION OF THE ITAT TO S UB-SECTION(3) OF SECTION 35 AND CONTENDED THAT QUESTION RELATING TO THE DEDUCTION CLAIMED UNDER SECTION CAN BE DETERMINED BY THE PRESCRIBED A UTHORITY ON REFERENCE MADE BY THE BOARD. AS SUCH, NO POWER HAS BEEN VES TED WITH THE AO PER SE TO DISALLOW THE ABOVE REFERRED EXPENDITURE WHICH A RE TECHNICAL IN ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 4 - NATURE. THE CO-ORDINATE BENCH OF THE ITAT SET ASID E THE ASSESSMENT AND RESTORED THE MATTER BACK TO THE FILE OF THE AO FOR RE-ADJUDICATION AFTER TAKING INTO ACCOUNT THE DECISION OF THE PRESCRIBED AUTHORITY IN THIS REGARD. 6. THE RELEVANT PARA OF THE ORDER OF THE ITAT READS AS UNDER:- 7. HAVING HEARD BOTH THE SIDES, WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IT IS PERTINENT T O NOTE THAT IN THE ASSESSMENT ORDER FOR THE ASSESSMENT YEAR 2004-05, T HE ASSESSING OFFICER HAS MENTIONED THAT THE MATTER IS REFERRED T O THE RELEVANT AUTHORITY AND AWAITED SUCH DECISION AND SUBJECT TO THE SAME, HE WAS DISALLOWED THE CLAIM UNDER SECTION 35 OF THE IN COME TAX ACT, 1961 HOLDING THAT EXPENDITURE CLAIMED ON PURCHASE O F MACHINERY TO BE NOT DIRECTLY RELATED TO R&D ACTIVITY. KEEPIN G IN VIEW THESE PECULIAR FACTS, WE ARE OF THE VIEW THAT IT WILL MEE T THE END OF JUSTICE IF THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ON THIS ISSUE FOR BOTH THE ASSESSMENT YEARS IS SET ASI DE AND THE MATTER IS RESTORED TO THE FILE OF ASSESSING OFFICER WITH T HE DIRECTION THAT HE MAY VERIFY WHETHER THE DECISION OF RELEVANT AUTHORI TIES RECEIVED. ASSESSING OFFICER WILL CONFRONT THE SAME TO THE ASS ESSEE AND READJUDICATE THE CLAIM OF THE ASSESSEE UNDER SECTIO N 35 OF THE INCOME TAX ACT, 1961 FOR BOTH THE ASSESSMENT YEARS UNDER APPEALS. RESULTANTLY, FOR STATISTICAL PURPOSES, TH E GROUNDS NO.1 & 2 OF ASSESSEES APPEAL FOR THE ASSESSMENT YEAR 2004 -05 AND ONLY GROUND OF ASSESSEE FOR THE ASSESSMENT YEAR 2005-06 ARE TREATED AS ALLOWED. 6.1. PURSUANT TO THE DIRECTION OF THE ITAT, THE AO FRAMED THE ASSESSMENT ORDER UNDER SECTION 143(3) R.W.S. 254 OF THE ACT DATED 26/12/2011 WHEREIN HE ONCE AGAIN REAFFIRMED THE EAR LIER ACTION OF DISALLOWANCE ON THE SIMILAR GROUND THAT DECISION OF THE PRESCRIBED ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 5 - AUTHORITY CONTINUES TO BE AWAITED. IN CONSEQUENCE , THE AO ADDED BACK THE AMOUNT TO THE INCOME OF THE ASSESSEE-COMPANY SU BJECT TO FURTHER CAVEAT THAT THE ASSESSMENT ORDER SHALL BE MODIFIED SUITABLY AFTER THE RECEIPT OF THE DECISION OF THE PRESCRIBED AUTHORITY ON THIS MATTER. THE AO ALSO COMMITTED THAT THE TAX DEMAND RAISED ON ACCOUN T OF THE AFORESAID ADDITION WILL NOT BE ENFORCED UNTIL THE RECEIPT OF THE DECISION OF THE PRESCRIBED AUTHORITY ON THIS ISSUED. ONCE AGAIN, THE CIT(A) ALSO IN ITS ORDER DATED 16/06/2012 IN THE SECOND ROUND OF PROC EEDINGS REAFFIRMED THE ACTION OF THE AO. THE RELEVANT PARA OF THE ORD ER OF THE CIT(A) ON THIS ISSUE READS AS UNDER:- 3.2. I HAVE CONSIDERED THE SUBMISSIONS OF THE APPE LLANT AND OBSERVATIONS OF THE ASSESSING OFFICER. IMPUGNED O RDER WAS PASSED IN PURSUANCE TO THE TRIBUNAL RESTORING THE MATTER T O THE FILE OF THE A.O. THE OPERATIVE PORTION OF THE TRIBUNALS ORDER WAS REPRODUCED BY THE AO AT PARA-5 OF THE ASSESSMENT OR DER. AS SEEN THEREFROM, THE TRIBUNAL DIRECTED THE AO TO VERIFY W HETHER THE DECISION OF THE RELEVANT AUTHORITY (WITH REFERENCE TO THE CLAIM U/S.35) WAS RECEIVED, TO CONFRONT THE ASSESSEE WITH THE DECISION AND READJUDICATE THE CLAIM U/S.35. THE WRITTEN SUB MISSIONS FILED DURING THE COURSE OF APPELLATE PROCEEDINGS ARE BRIE F AS REPRODUCED ABOVE. AS SEEN THEREFROM, THE APPELLANT BASICALLY RELIED ON THE SUBMISSION FILED BEFORE THE AO AND HAS NOTHING MORE TO SAY. THE SUBMISSIONS FILED BEFORE THE AO WERE REPRODUCED AT PARA-6 OF THE ASSESSMENT ORDER. AS SEEN THEREFROM, APPELLANT CON TENDED THAT AO HAD NO JURISDICTION TO REFER THE MATTER TO RELEVANT AUTHORITY AND EVEN ON MERITS APPELLANT WAS ENTITLED TO THE ALLOWA NCE U/S.35. ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 6 - FURTHER THE APPELLANT REQUESTED FOR A COPY OF THE R EPORT OF THE RELEVANT AUTHORITY TO ENABLE IT TO SUBMIT REJOINDER . 3.3. AT PARA-7 OF THE IMPUGNED ORDER, AO STATED THA T THE DECISION OF THE PRESCRIBED AUTHORITY WAS AWAITED; PENDING RE CEIPT OF THE REPORT, THE R&D EXPENDITURE CLAIMED BY THE ASSESSEE U/S.35 WAS BEING DISALLOWED; HOWEVER, IMPUGNED ORDER WOULD BE MODIFIED ON RECEIPT OF THE3 REPORT AND TILL SUCH DATE THE DEMAN D RAISED WOULD NOT BE ENFORCED. THIS FINDING OF THE AO DOES NOT G IVEN RISE TO ANY GRIEVANCE FOR THE APPELLANT. KEEPING IN VIEW THE SPECIFIC AND LIMITED DIRECTIONS OF THE TRIBUNAL, APPELLANTS CON TENTION THAT THE AO HAS NO JURISDICTION TO REFER THE MATTER TO THE R ELEVANT AUTHORITY GOES BEYOND THE MANDATE OF THE TRIBUNALS ORDER. T HEREFORE, I AM OF THE CONSIDERED VIEW THAT THIS APPEAL IS NOT MAIN TAINABLE. THE GRIEVANCE, IF ANY, MAY ARISE CONSEQUENT ON THE MODI FICATION OF THE IMPUGNED ORDER. APPELLANT WOULD BE AT LIBERTY TO F ILE APPEAL AGAINST SUCH MODIFICATION ORDER IF NEED BE. I HOLD THAT THIS APPEAL IS NOT MAINTAINABLE. THESE GROUNDS OF APPEAL ARE D ISMISSED. 7. AGGRIEVED BY THE ORDER OF THE CIT(A), THE ASSESS EE IS IN APPEAL BEFORE THE TRIBUNAL IN THE SECOND ROUND OF LITIGATI ON. 8. THE LD.AR FOR THE ASSESSEE, AT THE OUTSET, SUBMI TTED THAT THE ASSESSMENT YEAR CONCERNED RELATES TO FINANCIAL YEAR (FY)2003-04. TODAY, WE ARE IN FY 2016-17. THEREFORE CONSIDERABLE TIME HAS ALREADY ELAPSED AND THE SO-CALLED REPORT FROM THE PRESCRIBE D AUTHORITY IS CONTINUE TO BE AWAITED. IN THE PROCESS, THE ASSESSEE-COMPANY CONTINUES TO SUFFER FROM THE AGONY AND THE DISPUTE CONTINUES TO LOOM LA RGE ON THE HEAD OF THE ASSESSEE WITHOUT ANY JUSTIFIABLE REASON. IT WAS S UBMITTED THAT ALTHOUGH ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 7 - THE DEMAND HAS BEEN KEPT IN ABEYANCE, THE ASSESSEE CONTINUES TO SUFFER ON ACCOUNT OF ANXIETY AND POSSIBLE LOSS TOWARDS INT EREST IN THE EVENT OF REPORT ADVERSE TO THE ASSESSEE. IN ADDITION, OWING TO CONSIDERABLE GAP, THE ASSESSEE IS LOOSING EFFICACY IN DEFENDING THE C ASE. THE LD.AR ACCORDINGLY PLEADED THAT THERE SHOULD BE AN END TO THE LITIGATION ON SUCH STALE CAUSE. THUS, THE REVENUE HAVING FAILED TO O BTAIN THE REPORT FROM THE PRESCRIBED AUTHORITY IN SPITE OF SUFFICIENT OPP ORTUNITY IN THIS REGARD, THE INFERENCE SHOULD NECESSARILY BE DRAWN IN FAVOUR OF ASSESSEE. 9. THE LD.DR, ON THE OTHER HAND, SUPPORTED THE ORDE R OF THE CIT(A) AND SUBMITTED THAT THE MATTER MAY AGAIN BE SET ASID E TO THE FILE OF THE AO TO ADJUDICATE THE MATTER IN THE LIGHT OF THE FINDIN GS OF THE PRESCRIBED AUTHORITY AS AWAITED. 10. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS. THE CONTROVERSY IN THE INSTANT CASE IS PERTAINING TO AL LOWABILITY OF DEDUCTION UNDER SECTION 35(1)(IV) OF THE ACT. THE AO DISPUTE D THE CLAIM OF THE ASSESSEE AND REFERRED TO THE MATTER TO THE BOARD FO R OBTAINING THE REPORT OF THE PRESCRIBED AUTHORITY ON WHETHER THE ASSETS W ERE BEING USED TO SCIENTIFIC RESEARCH IN COMPLIANCE OF SECTION 35 OR NOT. AS NOTED, THE AO PENDING THE REPORT FROM THE PRESCRIBED AUTHORITY, D ISALLOWED THE CLAIM OF THE ASSESSEE AND THE LITIGATION WAS PUT IN MOTION A S NARRATED IN THE EARLIER PARAS. IN THE SECOND ROUND OF LITIGATION AFTER THE LAPSE OF MORE THAN A ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 8 - DECADE, THE REVENUE HAS CONTINUED TO EXPRESS ITS IN ABILITY TO OBTAIN THE REPORT FROM THE PRESCRIBED AUTHORITY. IN OUR OPIN ION, THE DOMOCLES SWORD CANNOT BE ALLOWED TO HANG ENDLESSLY AT THE CA PRICE OF STATUTORY AUTHORITY FOR NO FAULT OF THE SUBJECT. WE ARE UNA BLE TO VISUALIZE AS TO WHAT USEFUL PURPOSE WILL BE SERVED TO KEEP THE MAT TER PENDING FOR SUCH A LONG PERIOD AND KEEPING THE ASSESSEE VEXED IN UNWAR RANTED LITIGATION. SUCH INFINITE DELAY DEFEATS THE PURPOSE TO BE ACHIE VED BY SUCH PROCESS. WE ALSO TAKE COGNIZANCE OF THE PLEA ON BEHALF OF TH E ASSESSEE THAT THE INORDINATE DELAY HAS CAUSED IRREVERSIBLE LOSS OF EF FICACY IN DEFENDING THE ISSUE EFFECTIVELY. THE ASSESSEE CANNOT BE ALLOWED TO SUFFER TYRANNY FOR SUCH INORDINATE DELAY. NOTHING HAS BEEN BROUGHT ON RECORD BY THE REVENUE TO SHOW THAT THE MATTER HAS BEEN PURSUED WI TH THE PRESCRIBED AUTHORITY WITH SOME DEGREE OF DESIRE AND SINCERITY. WE ARE ALSO NOT AWARE AS TO WHAT IS STOPPING THE PRESCRIBED AUTHORI TY FROM GIVING THE REPORT ON THE MATTER. SUCH KIND OF LACKADAISICAL A PPROACH ON THE PART OF THE AUTHORITIES DISCHARGING PUBLIC FUNCTION IS UNHE ALTHY AND MUST BE ESCHEWED SCRUPULOUSLY. HENCE, WE ARE NOT INCLINE D TO EXTEND FURTHER TIME FOR OBTAINING THE PURPORTED REPORT FROM THE PR ESCRIBED AUTHORITY. THE REVENUE HAVING FAILED TO CONTROVERT THE CLAIM O F THE ASSESSEE WITH REFERENCE TO THE REPORT OF THE PRESCRIBED AUTHORITY IS THEREFORE DIRECTED TO ACCEPT THE CLAIM OF THE ASSESSEE IN THIS REGARD. C ONSEQUENTLY, THE DISALLOWANCE OF CLAIM MADE UNDER SECTION 35(1)(IV) IS QUASHED. ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 9 - 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLO WED. ITA NO.1047/AHD/2013 FOR AY 2004-05 ASSESSEES A PPEAL 12. THIS APPEAL IS DIRECTED AGAINST THE ORDER OF TH E CIT(A)-XX, AHMEDABAD DATED 01/03/2013 ARISING OUT OF THE ORDE R OF THE AO PASSED UNDER SECTION 143(3) DATED 29/12/2006. 12.1. THE SOLITARY ISSUE RAISED IN THIS APPEAL READ S AS UNDER:- 1. THAT THE LEARNED CIT(A)-XX, AHMEDABAD HAS GRIEV OUSLY ERRED IN DISALLOWING THE CLAIM OF THE APPELLANT FOR 100% DEPRECIATION ON ENERGY SAVING DEVICES AMOUNTING TO RS.14,08,475. 13. BRIEFLY STATED, THE AO INTER-ALIA OBSERVED THAT THE ASSESSEE HAS CLAIMED DEPRECIATION @ 100% IN RESPECT OF PLANT AND MACHINERY TO RS.27,19,749/- BEING AIR CONDITION PLANT SHOWN TO B E ENERGY SAVING MACHINERY. THE AO OBSERVED THAT THE CLAIM OF THE A SSESSEE IS NOT COVERED UNDER RULE 5(8)(IX) OF THE INCOME TAX RULES , 1962. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE CHAN GED ITS EARLIER STAND TOWARDS CLAIM OF 100% BEFORE THE AO AND CONTENDED T HAT THE CASE OF THE ASSESSEE IS COVERED BY PART-III (8)(IX) E(D) WHICH DEPICTS ELECTRICAL EQUIPMENTPOWER FACTOR CONTROLLER FOR AC MOTORS REA D WITH G(D) WHICH DEPICTS OTHER EQUIPMENT AUTOMATIC MICRO PROCESSOR S BASED LOAD DEMAND ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 10 - CONTROLLERS. THE ASSESSEE ACCORDINGLY PLEADED FOR REVISED GRANT OF CLAIM OF DEPRECIATION FROM 100% TO 80%. THE AO HOWEVER D ENIED THE DEPRECIATION CLAIM TO THE ASSESSEE ON THE GROUND TH AT THE BILL FOR PURCHASE DOES NOT VOUCH THE CLAIM OF THE ASSESSEE. AGGRIEVE D BY THE ORDER OF THE AO, THE ASSESSEE PREFERRED THE APPEAL BEFORE THE CI T(A). THE CIT(A) ALSO ENDORSED THE ACTION OF THE AO. HOWEVER, THE C IT(A) ACCEDED TO THE ALTERNATE CLAIM OF THE ASSESSEE BEFORE IT AND ALLOW ED DEPRECIATION CLAIMED AT THE NORMAL RATE FOR PLANT AND MACHINERY AS PROVI DED AS PER SECTION 32 OF THE ACT. 14. AGGRIEVED BY THE DENIAL OF THE CIT(A) IN ACCEPT ING THE ACCELERATED CLAIM OF DEPRECIATION, THE ASSESSEE HAS PREFERRED A PPEAL BEFORE THE TRIBUNAL. 15. THE LD.AR FOR THE ASSESSEE MR.M.K.PATEL SUBMIT TED THAT THE ASSESSEE HAS PURCHASED PLANT AND MACHINERY AMOUNTIN G TO RS.27,19,749/- BEING AIR CONDITION PLANT WHICH IS ELIGIBLE FOR ACC ELERATED DEPRECIATION CLAIM OF 80%. THE LD.AR FOR THE ASSESSEE SUBMITTED THAT THE IMPUGNED PLANT & MACHINERY IS AN ENERGY SAVING DEVICE FALLI NG UNDER PART-III (8) (IX)E(D) R.W.G(D) OF THE DEPRECIATION SCHEDULE BEIN G POWER-FACTOR CONTROLLER FOR AC MOTORS R.W.(IX)G(D) BEING AUTOMA TIC MICRO PROCESSOR BASED LOAD DEMAND CONTROLLERS. TO BUTTRESS HIS STA ND, THE LD.AR RELIED UPON THE REPORT FROM THE AIR CONDITION SUPPLIERS M /S.VOLTAS LTD. TO ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 11 - SUBMIT THAT THESE PLANT AND MACHINERY AND ENERGY EF FICIENT AND SAVE CONSIDERABLE ENERGY. 16. THE LD.DR, ON THE OTHER HAND, RELIED UP-ON THE ORDER OF THE CIT(A) AND SUBMITTED THAT THE CLAIM OF ACCELERATED DEPRECIATION IS WITHOUT ANY FOUNDATION. 17. ON CAREFUL CONSIDERATION OF THE RIVAL SUBMISSIO NS, WE DO NOT FIND ANY MERIT IN THE CONTENTION ON BEHALF OF THE ASSESS EE. THE AIR CONDITION PLANT CANNOT BE EQUATED WITH POWER FACTOR CONTROLLE R FOR AIR CONDITION MOTORS OR WITH AUTOMATIC MICRO PROCESSOR BASED LOAD DEMAND CONTROLLERS. IN OUR VIEW, THE CIT(A) WAS RIGHT IN REFUSING THE CLAIM OF ACCELERATED DEPRECIATION ON IMPUGNED PURCHASES OF M ACHINERY. THEREFORE, NO INTERFERENCE WITH THE ORDER OF THE CI T(A) IS CALLED FOR. 18. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMIS SED. ITA NO.1048/AHD/2013 FOR AY 2005-06 ASSESSEES A PPEAL 19. THIS APPEAL IS DIRECTED AGAINST THE ORDER OF TH E CIT(A)-XX, AHMEDABAD DATED 05/03/2013 ARISING OUT OF THE ORDE R OF THE AO PASSED UNDER SECTION 143(3) R.W.S. 254 OF THE ACT DATED 26 /12/2011. ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 12 - 19.1. THE SOLITARY ISSUE RAISED IN THIS APPEAL READ S AS UNDER:- 1. THAT THE LEARNED CIT(A)(XX), AHD, HAS GRIEVOUSLY E RRED IN DISALLOWING THE APPELLANTS CLAIM U/S.35(I)(IV) AMOU NTING TO RS.2,09,820. 20. THE AFORESAID GROUND IS IDENTICAL TO THE GROUND TAKEN IN ITA NO.1824/AHD/2012 FOR AY 2004-05 IN ASSESSEES OWN C ASE. 21. FOLLOWING THE PARITY OF REASONING, WE ALLOW THE APPEAL OF THE ASSESSEE IN THIS ASSESSMENT YEAR ALSO. 22. IN THE COMBINED RESULT, ASSESSEES APPEALS IN I TA NO.1824/AHD/2012 FOR AY 2004-05 IS ALLOWED, ITA NO .1047/AHD/2013 IS DISMISSED AND ITA NO.1048/AHD/2013 IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 19 / 01 /201 7 SD/- SD/- () ( ) (RAJPAL YADAV) ( PRADIP KUMAR KEDIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 19/ 01 /2017 1..&,.&../ T.C. NAIR, SR. PS ITA NOS.1824/AH D/2012 & ITA NOS.1047 & 1048/AHD/2013 INVESTMENT & PRECISION CASTING LTD. VS. JT.CIT/AC IT ASST.YEARS 2004-05, 2004-05 & 2005-06 - 13 - ! ' / COPY OF THE ORDER FORWARDED TO : 1. ! / THE APPELLANT 2. $ ! / THE RESPONDENT. 3. 345( 6( / CONCERNED CIT 4. 6( ( ) / THE CIT(A)-XX, AHMEDABAD 5. 789(&45 , 45, , 3 / DR, ITAT, AHMEDABAD 6. 9;' / GUARD FILE. / BY ORDER, $7(( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 122.1.17 (DICTATION-PAD 32 -PAGES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 16.1.17 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 19.1.17 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 19.1.17 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER