Doddanavar Brothers Mine Owners., Bangalore V. Principal Commissioner of Income Tax., Belagavi

ITA 202/PAN/2015

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1321 (ITAT-PANAJI)
• Duration Of Justice: 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 18-11-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 18-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P DINESH
• Keywords: Depreciation; Additional depreciation
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI N.S. SAINI , HONBLE ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, HONBLE JUDICIAL MEMBER ITA NO. 2 02 /PNJ/201 5 (ASST. YEAR : 20 1 0 - 1 1 ) DODDANAVAR BROTHERS MINE OWNERS, DODDANAVAR CORPORATE HOUSE, 738/1, NEAR 3 RD RAILWAY GATE, KHANAPUR ROAD, BELAGAVI. VS. P CIT, BEL A GA VI . PAN NO. AABFD 2165 J (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI P. DINESH ADV. DEPARTMENT BY : SHRI PRASHANT GADEKAR - D R DATE OF HEARING : 18 / 1 1 /2015 . DATE OF PRONOUNCEMENT : 1 8 / 1 1 /201 5 . O R D E R PER N.S. SAINI , ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF PRINCIPAL COMMISSIONER OF INCOME TAX , BELGAUM , DATED 17 /0 3 /201 5 . 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS THAT THE PRINCIPAL COMMISSIONER OF INCOME TAX WAS NOT JUSTIFIED IN HOLDING THAT THE ASSESSEE HAS USED HIS OWN TRUCKS FOR DELIVERING HIS OWN IRON ORE TO HIS CUSTOMERS AND, THEREFORE, WAS NOT ENTITLED TO CLAIM OF HIGHER DEPRECIATION ON TRUCKS AND THEREBY, DISALLOWING EXCESS DEPRECIATION OF 57,65,588/ - . 3 . WE HAVE HEARD RIVAL SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE ORDERS OF THE LOWER A UTHORITIES AND THE MATERIAL AVAILABLE ON RECORD . THE ASSESSMENT ORDER UNDER SEC. 143(3) OF THE ACT WAS PASSED IN THE CASE OF THE ASSESSEE ON 27/12/2012 FOR THE ASSESSMENT YEAR 2010 - 11 . 2 ITA NO. 202 /PNJ/201 5 IN THE SAID ASSESSMENT , THE ASSESSING OFFICER ALLOWED CLAIM OF DEPRECIATION ON TRUCKS @ 30% TO THE ASSESSEE. 4 . THEREAFTER, PRINCIPAL COMMISSIONER OF INCOME TAX BY INVOKING HIS POWER UNDER SEC. 263 OF THE ACT, PASSED THE ORDER DATED 17/03/2015 DISALLOWING THE CLAIM FOR ADDIT IONAL DEPRECIATION TO THE ASSESSEE ON THE GROUND TH A T THE ASSESSEE USED ITS OWN TRUCKS FOR DELIVERING HIS OWN IRON ORE TO HIS CUSTOMERS AND HENCE, WAS NOT ENTITLED TO HIGHER DEPRECIATION, AS THE TRUCKS ARE NOT USED FOR HIRING BUSINESS. 5. THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE IN THE PAPER BOOK HAS FILED AT PAGE NO. 10 COPY OF TRANSPORTATION AGREEMENT WITH BAGALKOT CEMENT & INDUSTRIES LTD. DATED 26/03/2008 AND AT PAGE NO. 11 OF THE PAPER BOOK, COPY OF TRANSPORTATION AGREEMENT WITH AC C LTD. DATED 20/11/2009 . HE POINTED OUT THAT M/S. BAGALKOT CEMENT & INDUSTRIES LTD. AGREED TO PAY TRANSPORTATION CHARGES @ 7 0 / - PER TONNE AND ACC LTD. AGREED TO PAY TRANSPORTATION CHARGES @ 425/MT. THUS, IT WAS THE SUBMISSION THAT IT CAN BE SEEN THAT THE ASSESSEE WAS DOING TRANSPORTATION BUSINESS BY HIRING HIS TRUCKS TO OTHERS . HE FURTHER POINTED OUT FROM THE ASSESSMENT ORDER DATED 20/08/2012 PASSED UNDER SEC. 143(3) OF THE ACT FOR ASSESSMENT YEAR 2009 - 10 PLACED AT PAGE NOS. 38 TO 41 OF THE PAPER BOOK THAT THE ASSESSING OFFICER IN PARA 2 OF THE ASSESSMENT ORDER S TATE S AS UNDER: - 2. T HE ASSESSEE IS ENGAGED IN IRON ORE MINING, TRANS PORTATION AND POWER GENERATION THROUGH WIND MILL . FURTHER, FROM THE ASSESSMENT ORDER DATED 27/12/2012 PASSED 143(3) OF THE ACT IN ASSESSMENT YEAR 2010 - 11, HE AGAIN POINTED OUT THAT THE ASSESSING OFFICER IN PARA 2 OF THE ORDER STATE D AS UNDER: - 2. THE ASSESSEE IS ENGAGED IN IRON ORE MINING, TRANSPORTATION AND POWER GENERATION THROUGH WIND MILL. HE, THUS, SUBMITTED THAT FROM THESE EVIDENCES, IT IS CLEAR TH A T THE ASSESSEE WAS CARRYING ON TRANSPORTATION BUSINESS AND THE RECEIPTS FROM THE SAME HA VE BEEN DULY SHOWN IN THE PROFIT & LOSS ACCOUNT . HE, 3 ITA NO. 202 /PNJ/201 5 THEREFORE, SUBMITTED THAT THE DISALLOWANCE OF ADDITIONAL DEPRECIATION MADE BY THE PRINCIPAL COMMISSIONER OF INCOME TAX BY PASSING THE ORDER UNDER SEC. 263 OF THE ACT WAS NOT JUSTIFIED AND SUBMITTED THAT T HE SAME SHOULD BE DELETED. 6 . THE DEPARTMENTAL REPRESENTATIVE REL IED ON THE ORDER OF THE PRINCIPAL COMMISSIONER OF INCOME TAX. 7 . WE FIND THAT THE DEPARTMENTAL REPRESENTATIVE COULD NOT CONTROVERT THE SUBMISSIONS OF THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE THAT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF TRANSPORTATION BY BRINGING ANY COGENT AND RELEVANT MATERIAL ON RECORD. WE FIND THAT AUTHORIZED REPRESENTATIVE OF THE ASS ESSEE HAS DEMONSTRATED WITH COGENT MATERIAL BEFORE US AS WELL AS THE OBSERVATION MADE BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRANSPORTATION AND, THEREFORE, IN OUR CONSIDERED VIEW, THE PRINCIPAL COMMISSIONER OF INCOME TAX WAS NOT JUSTIFIED IN DISALLOWING THE CLAIM FOR DEPRECIATION ON TRUCKS AT HIGHER RATE OF 30% TO THE ASSESSEE. HENCE, WE SET ASIDE THE ORDER OF THE PRINCIPAL COMMISSIONER OF INCOME TAX AND DEL E TE THE ADDITION OF 57 ,65,588/ - MADE BY DISALLOWING THE ADDITIONAL CLAIM OF DEPRECIATION ON TRUCKS TO THE ASSESSEE , AND THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING ON WEDNESDAY , THE 1 8 TH DAY OF NOVEMBER , 201 5 AT GOA . S D / - S D / - (GEORGE MATHAN) (N.S.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 1 8 TH NOVEMBER , 201 5 . 4 ITA NO. 202 /PNJ/201 5 VR/ - COPY TO: 1 . THE ASSESSEE. 2 . THE REVENUE. 3 . THE CIT 4 . THE CIT(A) 5 . THE D.R . 6 . GUARD FILE. BY ORDER ASSISTANT REGISTRAR I.T.A.T., PANAJI 5 ITA NO. 202 /PNJ/201 5 DATE INITIAL ORIGINAL DICTATION PAD & DRAFT ARE ENCLOSED IN THE FILE 1. DRAFT DICTATED ON 1 8 . 1 1 .2015 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 19 . 1 1 .2015 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 19 / 1 1 /2015 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 19 / 1 1 /2015 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 1 9 / 1 1 /2015 SR.PS 6. DATE OF PRONOUNCEMENT 18 / 1 1 /2015 SR.PS 7. FILE SENT TO THE BENCH CLERK 19 / 1 1 /2015 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER