Samrat D. Chauhan, Kalol V. The Income Tax Officer, Ward-4, Mehsana

ITA 1882/AHD/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9484 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-06-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 14-08-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: O P PATHAK
• Keywords: Depreciation

Judgement Text

ITA NO. 1882/AHD/2017 SAMRAT D CHAUHAN VS ITO ASSESSMENT YEAR: 2014-15 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL, AHMEDABAD SMC BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR VP AND MAHAVIR PRASAD JM] ITA NO. 1882/AHD/2017 ASSESSMENT YEAR: 2014-15 SAMRAT D. CHAUHAN ..APPELLANT 90/91, JAY BHAWANI ROW HOUSING, B/H. RAILWAY STATION, KALOL 382 721 [PAN: AGUPC 9408 N] VS INCOME TAX OFFICER ..............RESPONDENT WARD 4, MEHSANA APPEARANCES BY JAIMIN SHAH, FOR THE APPELLANT OP PATHAK, FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 19.03.2019 DATE OF PRONOUNCEMENT : 11.06.2019 O R D E R PER PRAMOD KUMAR, VP: 1. BY WAY OF THIS APPEAL, THE APPELLANT HAS CHALLEN GED CORRECTNESS OF LEARNED CIT(A)S ORDER DATED 8 TH JUNE 2017, FOR THE ASSESSMENT YEAR 2014-15. 2. IN THE FIRST GROUND OF APPEAL, THE ASSESSEE IS A GGRIEVED OF DISALLOWANCE OF RS.9,18,921/- BY INVOKING PROVISIONS OF SECTION 2(2 4)(X) R.W.S. 36(1)(VA) OF THE INCOME-TAX ACT, 1961. 3. HAVING PERUSED THE MATERIAL ON RECORD AND HAVING HEARD THE RIVAL CONTENTIONS, WE FIND THAT THE CIT(A) HAS SIMPLY BRUSHED ASIDE CO NTENTION OF THE ASSESSEE THAT SO FAR AS THIS DISALLOWANCE IS CONCERNED THE CHEQUES W ERE TENDERED WELL IN TIME BUT WERE ENCASHED LATE, AND, FOR THIS SHORT REASON, THE DISALLOWANCE MUST BE DELETED. THE COPIES OF CHALLANS FILED BEFORE US SHOW THAT TH E ASSESSEE HAD PAID PF DUES FOR JANUARY14, FEBRUARY14 AND MARCH14 ON 15.02.2014, 14.03.2014 AND 15.04.2014 RESPECTIVELY, AND THESE CHEQUES WERE CLEARED ON 29. 02.2014, 21.02.2014 & ITA NO. 1882/AHD/2017 SAMRAT D CHAUHAN VS ITO ASSESSMENT YEAR: 2014-15 PAGE 2 OF 3 23.02.2014. ONCE THE PAYMENTS ARE MADE BY THE ASSE SSEE IN TIME, AS IN THIS CASE, THERE IS NO GOOD REASON TO MAKE THE DISALLOWANCE. WE, THEREFORE, DELETE THE IMPUGNED DISALLOWANCE OF RS.9,18,921/-. 4. GROUND NO. 1 IS THUS ALLOWED. 5. IN GROUND NO.2, THE ASSESSEE IS AGGRIEVED OF THE DISALLOWANCE OF RS.63,037/- OUT OF DEPRECIATION ON HONDA CITY CAR, FOR PERSONAL USE. 6. THE ASSESSEE IS A LABOUR CONTRACTOR. DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, IT WAS NOTICED THAT THE ASS ESSEE HAS CLAIMED DEPRECIATION ON TWO CARS HONDA CITY AND HONDA CIVIC. BOTH THE SE CARS WERE CLAIMED TO HAVE BEEN USED FOR BUSINESS PURPOSES, THOUGH THERE WAS N OTHING TO SUBSTANTIATE THE CLAIM. THE ASSESSING OFFICER NOTICED THAT HONDA CIT Y WAS ACQUIRED IN THE NAME OF THE ASSESSEE FOR PERSONAL PURPOSES. HE THUS DISALL OWED DEPRECIATION OF RS.1,26,074/- CLAIMED ON THIS CAR. WHEN THE MATTER TRAVELLED IN APPEAL BEFORE THE CIT(A), THE DISALLOWANCE WAS RESTRICTED TO 50% OF D EPRECIATION CLAIM BY OBSERVING AS FOLLOWS:- 5.3 I HAVE CONSIDERED THE FACTS OF THE CASE, ASSE SSMENT ORDER AND SUBMISSION FILED BY APPELLANT. THE AO HAS OBSERVED THAT APPELLANT HAS CLAIMED DEPRECIATION ON TWO CARS I.E. HONDA CITY AN D HONDA CIVIC. AS CAR LOAN OF HONDA CITY WAS SANCTIONED IN PERSONAL NAME, AO H AS TREATED SUCH EXPENDITURE AS PERSONAL EXPENDITURE AND DISALLOWED DEPRECIATION OF RS.1,26,074/-. THE APPELLANT HAS ARGUED THAT ABOVE CAR WAS USED FOR THE PURPOSE OF BUSINESS HENCE IT CANNOT BE STATED THAT SUCH CAR IS USED FOR PERSONAL PURPOSE. THE APPELLANT HAS CLAIMED TOTAL V EHICLE EXPENDITURE OF RS.35,185/- IN PROFIT & LOSS ACCOUNT, OUT OF WHICH IT HAS DISALLOWED PERSONAL EXPENDITURE OF RS.5,000/- WHICH PROVES THAT VEHICLE WAS USED FOR THE PURPOSE OF BUSINESS. HOWEVER, THIS CONTENTION OF APPELLANT CANNOT BE ACCEPTED FULLY, AS PERSONAL USAGE OF VEHICLE BY INDIVIDUAL CANNOT B E DENIED AND AO HIMSELF HAS ALLOWED FULL DEPRECIATION ON ANOTHER VEHICLE BE ING HONDA CIVIC. WHEN ASSESSES IS USING TWO CARS FOR HIS INDIVIDUAL PROPR IETARYSHIP BUSINESS, DISALLOWANCE OF DEPRECIATION PARTIALLY ON SUCH VEHI CLE IS JUSTIFIABLE AND HENCE 50% OF DEPRECIATION OF SUCH CAR FOR RS.63,037/- IS JUSTIFIABLE. THUS, ADDITION MADE BY AO IS RESTRICTED TO RS.63,037/-. THIS GROUN D OF APPEAL IS PARTLY ALLOWED. 7. THE ASSESSEE IS NOT SATISFIED AND IS IN FURTHER APPEAL BEFORE US. 8. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE AP PLICABLE LEGAL POSITION. 9. WE SEE NO REASONS TO DISTURB THE STAND OF THE CI T(A). THE ASSESSEE HAS TWO CARS AND THERE IS NO CONCLUSIVE PROOF THAT BOTH THE SE CARS WERE ENTIRELY USED FOR BUSINESS PURPOSES. THE ASSESSEE DOES NOT HAVE ANY OTHER CAR. IN THESE ITA NO. 1882/AHD/2017 SAMRAT D CHAUHAN VS ITO ASSESSMENT YEAR: 2014-15 PAGE 3 OF 3 CIRCUMSTANCES, DENIAL OF 50% DEPRECIATION SEEMS TO BE IN ORDER. WE CONFIRM THE SAME AND DECLINE TO INTERFERE IN THE MATTER. 10. GROUND NO.2 IS DISMISSED. 11. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. PR ONOUNCED IN THE OPEN COURT TODAY ON THE 11 TH JUNE, 2019 SD/- SD/- MAHAVIR PRASAD PRAMOD KUMAR (JUDICIAL MEMBER) (VICE PRESI DENT ) AHMEDABAD, THE 11 TH DAY OF JUNE, 2019 **BT COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: .....ORDER PREPARED AS PER 5 PAGES MANUSCRIPTS OF HONBLE VP- ATTACHED.....11.06.2019... 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: .. 11.06.2019..... 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: 11.06.2019... 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: .... 11.06.2019... 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : . . 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER : . 8. DATE OF DESPATCH OF THE ORDER: ......