The ACIT-2(1), Ujjain V. Late Shri Manoharlal Khatri L/h Komal Khatri, Ujjain

ITA 203/IND/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2239 (ITAT-INDORE)
• Duration Of Justice: 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 09-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Keywords: Depreciation; Wrong claim
• Section: 143(3)

Judgement Text

ACIT VS. MANOHARLAL KHATRI ITA NO. 203/IND/2017 1 , , IN THE INCOME TAX APPELLATE TRIB UNAL, INDORE BENCH, INDORE BEFORE SHRI C.M. GARG, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER .../ I.T.A. NO. 203/IND/2017 / ASSESSMENT YEAR: 2005-06 ASSTT.COMMR. OF INCOME TAX 2(1) UJJAIN :: / APPELLANT VS LATE SHRI MANOHARLAL KHATRI UJJAIN PAN ADEPK 8222A :: ! / RESPONDENT '# $ % & / REVENUE BY SHRI MOHD. JAVED - DR '( $ % & / ASSESSEE BY NONE ) * $ (+ DATE OF HEARING 3.5. 2017 ,-./ $ (+ DATE OF PRONOUNCEMENT 0 5 . 5 .2017 / O R D E R PER SHRI C.M. GARG, JM THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST T HE ORDER OF THE LEARNED CIT(A), UJJAIN, DATED 21.12.2016 IN FIR ST APPEAL NO. U- 241/2010-11 FOR THE ASSESSMENT YEAR 2005-06. ACIT VS. MANOHARLAL KHATRI ITA NO. 203/IND/2017 2 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS THAT T HE COMMISSIONER OF INCOME TAX (APPEALS) WAS NOT JUSTIF IED IN DELETING THE ADDITION OF RS.70,315/- ON ACCOUNT OF DEPRECIAT ION IGNORING THE FACT THAT ALLOWABLE DEPRECIATION ON DUMPER, LOADER AND POWER MACHINE ETC AS PER THE FACT OF THE CASE WAS @ 25% A S AGAINST CLAIM OF 40%. 3. BRIEFLY STATED, THE ASSESSMENT OF THE ASSESSEE W AS COMPLETED U/S 143(3) OF THE ACT AT AN INCOME OF RS.7,14,489/- AND AGRICULTURAL INCOME OF RS. 30,000/-. THEREAFTER ON FINDING THAT THE ASSESSEE HAS CLAIMED HIGHER RATE OF DEPRECIATION BY SHOWING THEM BEING UTILISED FOR HIRE BUSINESS FOR RENTAL INCOME WHEREAS ON PERUSAL OF THE DETAILS IT WAS OBSERVED BY THE ASSES SING OFFICER THAT THE ASSESSEE HAS UTILISED THESE MACHINES FOR HIS BU SINESS, ONLY JCB MACHINE WAS GIVEN ON RENT AGAINST WHICH AN INCOME O F RS. 5,58,162/- HAS BEEN SHOWN. THE ASSESSING OFFICER WA S, THEREFORE, OF THE VIEW ONLY JCB MACHINE CAN BE TREATED AS COMMERC IAL VEHICLE ON WHICH DEPRECIATION @ 40% IS ALLOWABLE. HE FURTHER F OUND THAT THE ASSESSEE HAS MADE WRONG CLAIM OF DEPRECIATION % 40% ON DUMPER, LOADER AND POWER MACHINE INSTEAD OF 25%. IN RESPON SE TO THE NOTICE, THE ASSESSEE SUBMITTED THAT THESE MACHINES HAVE BEEN USED ACIT VS. MANOHARLAL KHATRI ITA NO. 203/IND/2017 3 IN THE BUSINESS OF THE ASSESSEE AND HAD ALSO BEEN H IRED TO OUTSIDERS DURING THE IDLE TIME. HOWEVER, THE ASSESSING OFFIC ER DID NOT ACCEPT THE SUBMISSION OF THE ASSESSEE AND RESTRICTED THE D EPRECIATION TO 25% ON THESE MACHINES. ON APPEAL, THE COMMISSIONER OF INCOME TAX (APPEALS) ALLOWED THE CLAIM OF THE ASSESSEE AGA INST WHICH THE REVENUE IS IN APPEAL BEFORE US. 4. BEFORE US, THE LEARNED DR WHILE OPPOSING THE APP ELLATE ORDER HAS STRONGLY SUPPORTED THE ASSESSMENT ORDER. 5. ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE A SSESSEE SUBMITTED THAT SINCE THE COPY OF RENT ACCOUNT WITH FULL DETAILS OF RENT RECEIVED BY CHEQUE ON HIRING OF THE SAID MACHI NES HAS BEEN FILED BEFORE THE ASSESSING OFFICER AND THE COMMISSI ONER OF INCOME TAX (APPEALS) AND THE BOOKS OF ACCOUNTS ARE DULY AU DITED, THE COMMISSIONER OF INCOME TAX (APPEALS) WAS FULLY JUST IFIED IN ALLOWING THE CLAIM OF THE ASSESSEE. 6. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE S IDES. FROM A PERUSAL OF MATERIAL AVAILABLE ON THE RECORD OF THE TRIBUNAL AS ALSO THE WRITTEN SUBMISSIONS OF THE ASSESSEE, IT BECOMES CRYSTAL CLEAR THAT THE COPY OF RENT ACCOUNT WITH FULL DETAILS OF RENT RECEIVED BY CHEQUE ON HIRING OF THE SAID ASSETS HAS BEEN FILED BEFORE THE ACIT VS. MANOHARLAL KHATRI ITA NO. 203/IND/2017 4 AUTHORITIES BELOW BY THE ASSESSEE IN RESPECT OF DUM PER, LOADER, PAVER MACHINE, ETC. AND AS SUCH THE COMMISSIONER OF INCOME TAX (APPEALS) HAS RIGHTLY ALLOWED THE CLAIM OF DEPRECIA TION OF THE ASSESSEE. WE, THEREFORE, CONFIRM THE ORDER OF THE C OMMISSIONER OF INCOME TAX (APPEALS) AND DISMISS THIS APPEAL OF THE REVENUE. 7. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED . THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON 05 TH MAY, 2017. SD/- SD/- &+ # # (O.P.MEENA) (C.M. GARG) ACCOUNTANT MEMBER J UDICIAL MEMBER MAY 5 , 2017. DN/