Shri Jigish Maheshbhai Shah, Ahmedabad V. The ACIT.,Cent.Circle-2(4), Ahmedabad

ITA 1892/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 85534 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 28-07-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DINESH SINGH
• Assessee Lawyers: S N DIVETIA
• Keywords: Depreciation; Revised return
• Section: 32

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER AND SHRI N.S. SAINI , ACCOUNTANT MEMBER ITA NO . 1 89 2 /AHD/20 1 1 A. Y. 200 8 - 0 9 SHRI JIGISH MAHESHBHAI SHAH, 4 TH FLOOR, SAHAJ APARTMENT, NR. RAJPATH ROW HOUSE, OPP. CHITRAKUT - 1, BODAKDEV, AHMEDABAD. PAN: AEHPB 8061M VS ACIT, CENTRAL CIRCLE - 2(4), AHMEDABAD . (APPELLANT) (RESPONDENT) REVENUE BY : SHRI DINESH SINGH , SR. D.R. , ASSESSEE(S) BY : SHRI S.N. DIVETIA, A.R. / DATE OF HEARING : 22 / 1 2 /201 4 / DATE OF PRONOUNCEMENT: 9 JANUARY /201 5 / O R D E R PER SHRI MUKUL KUMAR SHRAWAT, JUDICIAL MEMBER THIS IS AN A PPEAL FILED BY THE ASSESSEE ARISING FROM THE ORDER OF T HE L EARNED CIT(A) - II I , AHMEDABAD , DAT ED 1 7 .0 6 .2011 AND THE MAIN GROUNDS RAISED ARE AS UNDER: 1. THE LD. AO AS WELL AS THE LD. CIT(A) HAS ERRED IN FACTS AND IN LAW BY ASSESSING THE TOTAL INCOME WITHOUT CONSIDERING THE CLAIM OF DEPRECIATION ON FURNITURE AMO UNTING TO RS.4,30,830/ - DURING THE ASSESSMENT PROCEEDINGS. 2. THE LD. AO AS WELL AS THE LD. CIT(A) HAS ERRED IN LAW AND IN FACTS IN NOT CONSIDERING THE ALLOWANCE OF DEPRECIATION RS.4,30,830/ - EVEN THOUGH THE SAME IS COMPULSORY AS PER EXPLANATION 5 OF SECT ION 32(1) OF IT ACT. 2. AT THE OUTSET, WE HAVE BEEN INFORMED THAT THE ASSESSMENT ORDER PASSED BY THE AO U/S.143(3) DATED 18.12.2010 WAS A CRYPTIC ORDER . ITA NO. 189 2 /AHD/201 1 SHRI JIGISH MAHESBHAI SHAH VS. ACIT, CENTRAL CIRCLE 2(4), AHMEDABAD . FOR A.Y. 200 8 - 0 9 - 2 - A CCORDING TO US , THE INCOME DECLARED WAS ASSESSED AS SUCH WITHOUT TAKING INTO ACCOUNT THE RETURN WHIC H WAS REVISED BY THE ASSESSEE. THIS FACT WAS BROUGHT TO THE NOTICE OF LEARNED CIT(A) HOWEVER HE WAS NOT IN AGREEMENT WITH THE CLAIM OF THE ASSESSEE AND HELD AS UNDER: 3. THE BASIC CONTENTION OF THE AR IS THAT THE AO HAS NOT CONSIDERED THE REVISED RETURN O F INCOME FILED ON 29/1/2010 WHEREIN THE APPELLANT HAS CLAIMED DEPRECIATION OF RS. 4,30,830/ - ON THE FURNITURE ON WHICH RENTAL INCOME WAS DISCLOSED UNDER THE HEAD O F INCOME FROM OTHER SOURCES. IN FACT, THERE IS NO DISCUSSION OF THE AO ON THIS SUBJECT IN THE ASSESSMENT ORDER. ACCORDING TO THE AR, AS PER SECTION 57 (II) OF THE INCOME TAX ACT, IN RESPECT OF RENTAL INCOME FROM MACHINERY, PLANT OR FURNITURE BELONGING TO THE APPELLANT AND LET ON HIRE, DEPRECIATION IS ALLOWABLE IN ACCORDANCE WITH THE PROVISIONS OF SECTION 32 FOR THE PURPOSE OF SECTION 57 OF THE INCOME TAX ACT. ACCORDING TO HIM THE CLAIM OF DEPRECIATION IS COMPULSORY PARTICULARLY IN VIEW OF EXPLANATION - 5 OF SECTION 32(1) OF THE INCOME TAX ACT. IT WAS THEREFORE SUBMITTED THAT THE APPELLANT IS ENTITLED TO CLAIM OF DEPRECIATION ON FURNITURE WHICH HAS - BEEN GIVEN ON HIRE BASIS AND THE INCOME FROM WHICH HAS BEEN SHOWN UNDER THE HEAD OF INCOME FROM OTHER SOURCES. 4 . I HAVE CONSIDERED THE SUBMISSION OF THE APPELLANT. THE ORIGINAL RETURN OF INCOME FOR ASSESSM ENT YEAR 2008 - 09 WAS FILED ON 31.3.2009. IT MAY BE MENTIONED THAT, THE DUE DATE OF FILING THE RETURN OF INCOME FOR ASSESSMENT YEAR 2008 - 2009 IN THIS CASE WAS 31/7/2008, WHEREAS THE RETURN OF INCOME WAS FILED BY THE APPELLANT BELATEDLY ON 31/3/2009. SINCE T HE ORIGINAL RETURN WAS A BELATED RETURN, IN VIEW OF THE DECISION OF HONOURABLE SUPREME COURT IN THE CASE OF JAGDISH CHANDRA SINHA 220 ITR 67(SC), A BELATED RETURN CANNOT BE REVISED. THEREFORE, THE REVISED RETURN FILED BY THE APPELLANT ON 29/ 1 /2010 IS NOT A VALID RETURN AND IN FACT IT IS TO BE TREATED AS NEVER FILED. THIS IS THE REASON AS TO WHY THE AO HAS NOT DISCUSSED ANYTHING ABOUT THE REVISED RETURN FILED BY THE APPELLANT ON 29/1/2010. 4.1. SINCE IN THE ORIGINAL RETURN OF INCOME THE APPELLANT HAS NOT MAD E ANY CLAIM OF DEPRECIATION ON FURNITURE AND IN FACT THE AR HAS NOT FURNISHED ANY EVIDENCE BEFORE ME WHICH SUGGESTS THAT THE DETAILS OF PURCHASE OF THE FURNITURE WAS FILED BY THE APPELLANT WITH THE ORIGINAL RETURN OF INCOME. SINCE, THE REVISED RETURN IS TO BE TREATED AS NON - EST AND THERE WAS NOTHING IN THE ORIGINAL RETURN OF INCOME WHICH INDICATED THE INVESTMENT IN THE FURNITURE, THERE WAS NO BASIS FOR THE AO TO ALLOW THE DEPRECIATION ON THE FURNITURE. THEREFORE, IN MY OPINION, THE AO WAS JUSTIFIED IN NOT C ONSIDERING THE REVISED RETURN OF INCOME OF THE APPELLANT. IN OTHER WORDS, THE APPEAL OF THE APPELLANT FOR ASSESSMENT YEAR 2008 - 2009 IS DISMISSED. 3. IN VIEW OF THE ABOVE FACTS, LEARNED AR, MR. S.N. DIVETIA HAS CONTESTED THAT IN VIEW OF THE PROVISIONS OF SECTION 32 EXPLANATION (5) , IT IS NOW MANDATORY ON THE PART OF THE REVENUE OFFICERS TO ALLOW THE CLAIM ITA NO. 189 2 /AHD/201 1 SHRI JIGISH MAHESBHAI SHAH VS. ACIT, CENTRAL CIRCLE 2(4), AHMEDABAD . FOR A.Y. 200 8 - 0 9 - 3 - OF THE DEDUCTION IN RESPECT OF DEPRECIATION WHILE COMPUTING THE TOTAL INCOME WHETHER OR NOT CLAIMED BY THE ASSESSEE. LEARNED AR HAS ALSO PLEADED THAT THE C OMPLETE INFORMATION ABOUT THE DEPRECIATION WERE VERY MUCH PART OF THE ACCOUNTS WHICH WERE FILED ALONG WITH THE RETURN; THEREFORE, THE AO OR LEARNED CIT(A) SHOULD HAVE ALLOWED THE DEPRECIATION. ON THE OTHER HAND, LEARNED SR.D.R., SRI DINESH SINGH HAS SUPPOR TED THE ORDER OF LEARNED CIT(A). 4. HAVING HEARD THE SUBMISSION OF BOTH THE SIDES, WE ARE OF THE CONSIDERED OPINION THAT THIS ISSUE SHOULD GO BACK TO THE FILE OF LEARNED CIT(A) TO BE DECIDED DENOVO CONSIDERATION AS PER LAW BECAUSE THE APPLICABILITY OF THE PROVISIONS AS MENTIONED ABOVE HAVE NOT BEEN CONSIDERED BY HIM. MOREOVER, HE HAS ALSO TO VERIFY WHETHER THE REQUISITE DETAILS IN RESPECT OF DEPRECIATION WERE DULY FILED BY THE ASSESSEE SO AS TO ALLOW THE DEDUCTION. HE IS ALSO EXPECTED TO EXAMINE THE LEGAL ASPECT OF THE CLAIM OF DEPRECIATION IN RESPECT OF RENTAL INCOME STATED TO BE EARNED FROM PLANT AND MACHINERY , ETC. WITH THESE DIRECTIONS THE MATTER IS RESTORED BACK TO BE DECIDED AFRESH, NEEDLESS TO SAY , AFTER PROVIDING ADEQUATE OPPORTUNITY OF HEARING TO T HE ASSESSEE. 5. IN THE RESULT, THE ASSESSEE S APPEAL IS ALLOWED FOR STATISTICAL PURPOSE ONLY. SD/ - SD/ - ( N.S. SAINI ) ( MUKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED / 1 2 / 20 1 4 PRABHAT KR. KESARWANI , SR. P . S . / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT ITA NO. 189 2 /AHD/201 1 SHRI JIGISH MAHESBHAI SHAH VS. ACIT, CENTRAL CIRCLE 2(4), AHMEDABAD . FOR A.Y. 200 8 - 0 9 - 4 - 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) - III, AHMEDABAD 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, / ( DY./ASSTT.REGISTRAR ) , / ITAT, AHMEDABAD