Vantage Advertising Private Limited, Chennai V. C.I.T - IV,kolkata, Kolkata

ITA 2044/KOL/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4662 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-08-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 02-08-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 01-07-2013
• Court: TRIBUNAL
• Department Lawyers: G MALLIKARJUNA
• Assessee Lawyers: J P KHAITAN
• Keywords: Revision of order; Depreciation
• Section: 143(3); 142(1); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : KOLKATA [BEFORE HONBLE SRI N.V.VASUDEVAN, JM & DR.ARJUN LAL SAINI, AM] I.T.A NO. 2044/KOL/20 13 ASSESSMENT YEAR : 2008-0 9 VANTAGE ADVERTISING PVT. LTD. -VS.- C.I.T- IV, KOLKATA KOLKATA KOLKATA [PAN : AABCV 1202 B] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SHRI J.P.KHAITAN, ADVOCATE FOR THE RESPONDENT : SHRI G.MALLIKARJUNA, CIT (DR) DATE OF HEARING : 02.08.2016. DATE OF PRONOUNCEMENT : 10.08.2016. ORDER PER N.V.VASUDEVAN, JM THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 28.03.2013 OF C.I.T.- IV, KOLKATA PASSED U/S 263 OF THE ACT RELATING TO AY 2008-09. 2. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUS INESS OF ACTING AS OUT DOOR ADVERTISING AGENT. FOR A.Y.2008-09 THE ASSESSEE FIL ED RETURN OF INCOME ON 30.09.2008 SHOWING THE TOTAL INCOME OF RS.2,46,85,800/-. IN TH E COURSE OF ASSESSMENT PROCEEDINGS U/S 143(3) OF THE INCOME TAX ACT, 1961 (ACT), THE A O ISSUED NOTICE U/S 142(1) OF THE ACT CALLING FOR CERTAIN DETAILS ON 29.09.2010. ONE SUCH DETAIL CALLED FOR BY THE AO WAS AS FOLLOWS :- 4. AS PER SCHEDULE-6 OF YOUR BALANCE SHEET IT IS OBSERVED THAT YOU HAVE MADE ADDITIONS TO FIXED ASSETS OF A SUM OF RS.5,12,53,066/- AND AD DITIONS TO CAPITAL WORK-IN-PROGRESS OF A SUM OF RS.30,72,087/-. PLEASE FURNISH ALL THE DETAI LS OF THE ABOVE SAID ADDITIONS ALONG WITH ALL DOCUMENTARY EVIDENCES TO ESTABLISH YOUR CLAIM. 2 ITA NO.2044/KOL/2013 VANTAGE ADVERTISING PVT. LTD. A.YR.2008-09 2 3. THE ASSESSEE FILED REPLY DATED 08.12.2010 AND GAVE DETAILS OF ADDITIONS ON FIXED ASSETS ALONG WITH SAMPLE COPIES OF INVOICES WHICH W AS ANNEXED 2(A) AND 2(B) OF THE REPLY DATED 08.12.2010. THE ASSESSEE HAS ALSO GIVEN SCHEDULE OF DEPRECIATION IN WHICH 100% DEPRECIATION WAS CLAIMED ON HOARDING STRUCTURE S. THE DEPRECIATION CLAIMED ON HOARDING STRUCTURES AT 100% WAS ON A WDV OF HOARDIN G STRUCTURES AT RS.4,61,52,097/-. ASSESSMENT WAS COMPLETED BY THE AO U/S 143(3) OF TH E ACT IN WHICH NO ADVERSE INFERENCE WAS DRAWN WITH REGARD TO THE CLAIM OF DEP RECIATION ON HOARDINGS AS MADE BY THE ASSESSEE AND THE SAME WAS ALLOWED BY THE AO. TH ERE IS NO DISCUSSION ON THE CLAIM OF THE ASSESSEE FOR 100% DEPRECIATION AS ABOVE IN T HE ORDER OF ASSESSMENT. 4. THE CIT IN EXERCISE OF HIS POWERS U/S 263 OF THE ACT WAS OF THE VIEW THAT THE AFORESAID ORDER OF THE AO WAS ERRONEOUS AND PREJUDI CIAL TO THE INTEREST OF THE REVENUE FOR THE FOLLOWING REASONS : 1. THAT YOU CLAIMED DEPRECIATION ON HOARDING STRU CTURE AT THE RATE OF 100% INSTEAD OF AT THE RATE OF 120% AND THE SAME WAS ALLOWED IN THE AS SESSMENT. THE ACTION HAS RESULTED IN EXCESS DEPRECIATION ALLOWANCE BY RS.4,34,51,894/-. IN VIEW OF THE ABOVE FACT, THE ORDER PASSED UNDER SECTION 143(3) IS ERRONEOUS AND PREJUD ICIAL TO THE INTEREST OF REVENUE. I, THEREFORE, PROPOSE TO REVIEW THE ASSESSMENT MADE BY THE ASSESSING OFICER AND, THEREFORE, YOUR CASE IS ACCORDINGLY FIXED FOR HEARING AT 03:00 P.M. ON 26-02-2013 IN MY OFFICE CHAMBER IN ROOM NO.6/4, AAYAKAR BHAVAN, P-7, CHOWRI NGHEE SQUARE, KOLKTA-69. IN THE CASE YOU FIND IT INCONVENIENT TO ATTEND THE HEARING , YOU MAY FURNISH YOUR WRITTEN SUBMISSION ON OR BEFO0RE 26-02-2013. 5. ACCORDINGLY THE SHOW CAUSE NOTICE U/S 263 DAT ED 18.02.2013 WAS ISSUED TO THE ASSESSEE BY CIT. IN REPLY TO THE AFORESAID SHOW- C AUSE NOTICE, THE ASSESSEE POINTED OUT THAT THE QUESTION AS TO WHETHER HOARDING STRUCTURES OF THE ASSESSEE WAS PURELY TEMPORARY ERECTION FOR THE PURPOSE OF CLAIMING 100% DEPRECIAT ION OR NOT HAD COME FOR CONSIDERATION IN A.Y.1985-86 AND AFTER CONSIDERING ALL THE FACTS AND EVIDENCE A FINDING WAS GIVEN IN THE SAID ASSESSMENT ORDER THAT HOARDIN G STRUCTURES WERE OF TEMPORARY NATURE AND IT WAS FURTHER HELD THAT 100% DEPRECIATI ON WAS TO BE ALLOWED ON THE SAME. A COPY OF THE ASSESSMENT ORDER 1985-86 WAS ALSO FILED BY THE ASSESEE BEFORE CIT. THE ASSESSEE FURTHER POINTED OUT THAT EVEN IN THE EARLI ER ASSESSMENT YEARS ORDERS OF CIT(A) 3 ITA NO.2044/KOL/2013 VANTAGE ADVERTISING PVT. LTD. A.YR.2008-09 3 AND ORDERS OF ITAT HAVE HELD THAT HOARDING STRUCTUR ES OF THE ASSESSEE COMPANY ARE PURELY TEMPORARY STRUCTURES AND AS SUCH DEPRECIATIO N @ 100% HAD TO BE ALLOWED. THE ASSESSEE POINTED OUT THAT THE AO HAS APPLIED HIS MI ND WHILE CONCLUDING HIS ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT AND THE CIT CANNO T IN EXERCISE OF HIS POWERS U/S 263 OF THE ACT ENTERTAIN A DIFFERENT VIEW ON THE ISSUE. RELIANCE WAS PLACED BY THE ASSESEE ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CA SE OF MALABAR INDUSTRIES LTD. VS CIT 243 ITR 83 (SC). 6. THE CIT HOWEVER WAS NOT SATISFIED WITH THE REPL Y GIVEN BY THE ASSESSEE AND HE HELD AS FOLLOWS :- C) IN IT'S SUBMISSION THE ASSESSEE HAS MAINLY STRES SED UPON THE FACT THAT, 100% DEPRECIATION WAS ALLOWED IN HIS CASE IN THE ASSESSM ENT YEAR 1985-86 AND SUBSEQUENT YEARS AND THIS YEAR ALSO THAT SHOULD BE ALLOWED AT THE SA ME RATE. BUT NO WHERE THE ASSESSEE HAS SUBMITTED THE NATURE OF HOARDING STRUCTURES USED IN THE RELEVANT PERIOD I.E DURING THE FINANCIAL YEAR 2007-08. THE ASSESSEE CLAIMED DEPREC IATION@ 100% ON THE HOARDING STRUCTURE FROM THE BEGINNING I.E THE HOARDING STRUC TURE USED IN THE FINANCIAL YEAR CORRESPONDING TO THE ASSESSMENT YEAR 1985~86 HAS NO BEARING ON THE DEPRECIATION OF SUBSEQUENT YEARS. THE ALLOWABLE DEPRECIATION FOR TH E ASSESSMENT YEAR 2008-09 HAS TO BE CONSIDERED IN THE LIGHT OF NATURE, OF STRUCTURE US ED FOR HOARDING DURING THE RELEVANT. FINANCIAL YEAR AND NOT ON THE PERCENTAGE OF DEPRECI ATION ALLOWED ALMOST 30 YEARS BACK IN HIS CASE. D) WITH THE ADVANCEMENT OF TECHNOLOGY THE MORE SUST AINABLE MATERIALS ARE USED FOR THE HOARDING STRUCTURES PARTICULARLY WHEN THOSE INVOLVE S HUGE AMOUNT AS IN THE CASE OF THE ASSESSEE WHICH INVOLVES CRORES OF RUPEES. THE ASSES SEE FAILED TO ESTABLISH HIS CLAIM THAT THE HOARDING STRUCTURE USED DURING THE CONCERNED PE RIOD WERE PURELY TEMPORARY IN NATURE. E) ACCORDINGLY, THE CLAIM OF THE ASSESSEE OF DEPREC IATION ON HOARDING STRUCTURE AT THE RATE OF 100% OUGHT TO BE DISALLOWED AND THE AO SHOULD LO OK INTO THIS ISSUE AFRESH AND PASS NECESSARY ORDER AS PER LAW. 7. AGGRIEVED BY THE ORDER OF CIT THE ASSESSEE HAS PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 8. WE HAVE HEARD THE SUBMISSIONS OF THE LD. COUN SEL FOR THE ASSESSEE AND THE LD. DR. THE LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT I T IS NOT CORRECT OBSERVATIONS BY THE 4 ITA NO.2044/KOL/2013 VANTAGE ADVERTISING PVT. LTD. A.YR.2008-09 4 CIT IN THE IMPUGNED ORDER THAT THE ISSUE AS TO WHET HER THE HOARDINGS ARE OF TEMPORARY STRUCTURE OR NOT WAS CONSIDERED WAY BACK IN A.Y.198 5-86. HE BROUGHT TO OUR NOTICE THAT THE ISSUE AS TO WHETHER THE HOARDINGS ARE TEMPORARY STRUCTURE OR NOT CAME FOR CONSIDERATION BEFORE THE HONBLE ITAT IN A.Y.2004-0 5 AND 2005-06 IN ITA NOS. 1054 & 1055/KOL/2008 AND THIS TRIBUNAL VIDE ITS ORDER DA TED 30.06.2009 HELD AS FOLLOWS :- 15. AFTER HEARING BOTH THE SIDES WE FIND THAT THE REVENUE HAS NOT BROUGHT ANYTHING ON THE RECORDS THAT THE HOARDINGS ARE HAVING LONGER LIFE THEN CLAIMED BY THE ASSESSEE AND GIVING BENEFIT OF ENDURING NATURE. THE ASSESSEES C LAIM IS THAT THESE HOARDINGS ARE HAVING LIFE OF ONE TO TWO MONTHS AND LESS THAN A YEAR. THE SE HOARDINGS ARE PUT TO USE FOR LESS THAN 180 DAYS. THE AO HAS NOT BROUGHT ANY EVIDENCE REGAR DING THE DURABILITY OF THE HOARDINGS. THE AOS OBSERVATIONS APPEARS TO BE A GU ESS WORK IN RESPECT OF QUALITY OF STRUCTURE OF THE HOARDS. THE ASSESSEE HAS ASKED FOR 100% DEPRECIATION ON THE STRUCTURE USED FOR LESS THAN 180 DAYS ON ACCOUNT OF NON DURAB ILITY OF ITS STRUCTURES. THE CIT(A)S ORDER GET SUPPORT FORM THE ITAT, JABALPUR BENCH DEC ISION RELIED UPON. IN THAT CASE THE HONBLE ITAT JABALPUR HAS HELD AS UNDER :- 8. THE LEARNED DR HAS CLAIMED THAT THERE WAS NO NE CESSITY OF ACQUISITION OF ANY NEW CYLINDER, IN VIEW OF THE PRODUCTION OF GASES IN THE YEAR UNDER CONSIDERATION AS COMPARED TO THE PRECEDING YEAR. HE HAS ALSO DOUBTED THE USER OF ALL THE CYLINDERS IN THE YEAR UNDER CONSIDERATION. WE FIND THAT THE ASSESSEE HAS GIVEN THE COMPLETE DATE-WISE DETAILS OF PURCHASE OF CYLINDERS, WHICH IS DETAILED IN THE PAG E 1 IN THE ASSESSMENT ORDER ITSELF. THE ASSESSING OFFICER HAS NOT DOUBTED THE ACQUISITION O F CYLINDERS DURING THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER HAS ALSO NOT D OUBTED THE USER OF ALL THE CYLINDERS FOR THE PURPOSE OF BUSINESS DURING THE YEAR UNDER CONSI DERATION. ON THE OTHER HAND, HE DISALLOWED THE DEPRECIATION WITH THE OBSERVATION 5 0 PER CENT OF THE TOTAL AMOUNT OF DEPRECIATION FOR USING THE PLANT AND MACHINERY FOR LESS THAN 180 DAYS. THUS, THE ASSESSING OFFICER HAS HIMSELF ACCEPTED THE USER OF ALL THE CYLINDERS FOR THE PURPOSE OF BUSINESS. HE HAD DISALLOWED THE 50 PER CENT DEPRECI ATION BECAUSE CYLINDERS WERE USED FOR LESS THAN 180 DAYS. THE LEARNED DEPARTMENTAL REPRES ENTATIVE IS A REPRESENTATIVE OF THE ASSESSING OFFICER. HE CANNOT DISPUTE A FACT, WHICH IS ACCEPTED BY THE ASSESSING OFFICER HIMSELF. THEREFORE, WHEN THE ASSESSING OFFICER HIMS ELF HAS ACCEPTED THE USER OF THE CYLINDERS, THE LEARNED DR CANNOT DISPUTE IT. IN VIE W OF THE LEGAL POSITION AND THE FACTS AS DISCUSSED ABOVE, WE HOLD THAT THE ASSESSEE IS ENTIT LED TO 100 PER CENT DEPRECIATION ON GAS CYLINDERS PURCHASED AND USED DURING THE YEAR UNDER CONSIDERATION AMOUNTING TO RS.15,32,092. GROUND NOS. 1,2 &3 OF THE ASSESSEES APPEAL ARE ALLOWED. THE CIT(A) GRANTED RELIEF BY ALLOWING 100% DEPRECIA TION NOT AS TREATING THE EXPENDITURE AS REVENUE IN NATURE AS CLAIMED BY THE REVENUE IN I TS APPEAL GROUND. THE RATIO DECIDED BY HONBLE ITAT, JABALPUR BENCH APPEARS TO BE APPLICAB LE IN THE ASSESSEES CASE. 5 ITA NO.2044/KOL/2013 VANTAGE ADVERTISING PVT. LTD. A.YR.2008-09 5 15.1. RESPECTFULLY FOLLOWING THE DECISION OF THE HO NBLE ITAT JABALPUR BENCH WE UPHOLD THE ORDER OF THE LD. CIT(A) ON THIS ISSUE AN D DISMISS THE REVENUES GROUND OF APPEAL ON THIS ISSUE. 9. THE REVENUE FILED THE APPEAL AGAINST THE AFOR ESAID ORDER DATED 30.06.2009 BEFORE THE HONBLE CALCUTTA HIGH COURT BUT HAS NOT CHOSEN TO CHALLENGE THE ORDER OF THE TRIBUNAL ON THE ISSUE OF ALLOWING 100% DEPRECIATION ON HOARDINGS. IN SUPPORT OF THE AFORESAID CONTENTION THE LD. COUNSEL FOR THE ASSESS EE FILED BEFORE US A COPY OF THE GROUNDS OF APPEAL FILED BY THE REVENUE BEFORE THE H ONBLE CALCUTTA HIGH COURT IN ITA NO.334 OF 2009. THE LD. COUNSEL FOR THE ASSESSEE FU RTHER POINTED OUT THAT THE REVENUE HAS NOT RAISED THIS ISSUE IN ANY OTHER ASSESSMENT Y EARS NAMELY A.Y.2007-08 AND 2008- 09. SO FAR AS A.Y.2009-10 IS CONCERNED IN ITA NO.13 92/KOL/2012 SIMILAR ISSUE WAS RAISED BY THE REVENUE BEFORE THE TRIBUNAL AND BY OR DER DATED 10;.03.2015 IN ITA NO.1392/KOL/2015, THE TRIBUNAL DISMISSED THE GROUND OF APPEAL OF THE REVENUE. IT WAS SUBMITTED BY HIM THAT THE AO AFTER TAKING DUE NOTIC E OF THE HISTORY OF THE CLAIM FOR DEDUCTION AT 100% THE HOARDINGS HAS RIGHTLY ALLOWED THE DEDUCTION CLAIMED BY THE ASSESSEE. HE PLACED RELIANCE ON THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF RUSSEL PROPERTIES LTD VS A.CHOWDHURY 109 IT R 229 WHEREIN THE HONBLE CALCUTTA HIGH COURT HELD THAT WHETHER THE AO FOLLOW S THE TRIBUNAL DECISION WHILE PASSING AN ORDER OF ASSESSMENT THE CIT U/S 263 OF T HE ACT CANNOT REVISE SUCH ORDER ON THE GROUND OF THE DECISION OF THE TRIBUNAL WAS CHAL LENGED BY THE REVENUE BEFORE THE APPELLATE AUTHORITY. 10. THE LD. DR, ON THE OTHER HAND, POINTED OUT T HAT UNDER PART-A IN APPENDIX-I UNDER THE HEAD TANGIBLE ASSETS ENTRY (4) ALLOWS DEPREC IATION AT 100% ON PURELY TEMPORARY ERECTIONS SUCH AS WOODEN STRUCTURE. ACCORDING TO HIM THE HOARDINGS IN QUESTION CANNOT BE REGARDED AS REAL TEMPORARY ERECTION. IN THIS REG ARD THE LD. DR FILED BEFORE US POLICY GUIDELINES ON DISPLAY OF ADVERTISEMENTS WITHIN THE KOLKATA MUNICIPAL CORPORATION AREA WHEREIN STRUCTURE GUIDELINES HAVE LAID DOWN WITH RE GARD TO THE SIZE OF THE HOARDINGS, 6 ITA NO.2044/KOL/2013 VANTAGE ADVERTISING PVT. LTD. A.YR.2008-09 6 STRUCTURAL DESIGN AND ERECTION OF THE HOARDINGS STR UCTURAL STABILITY CERTIFICATE FOR ERECTION OF HOARDINGS ETC. HE LAID EMPHASIS ON THE FACT THAT IN THE LIGHT OF SUCH STRINGENT CONDITIONS FOR ERECTION OF ADVERTISEMENT OF HOARDIN GS, IT CANNOT BE SAID THAT HOARDINGS ARE PURELY TEMPORARY ERECTION. HE PLACED RELIANCE O N THE DECISION OF THE HONBLE MUMBAI ITAT IN THE CASE OF ASIAN ADVERTISING , MUMB AI IN ITA NO.2349/MUM/2013 ORDER DATED 23.03.2016. IN THAT ORDER THE QUESTION THAT WAS CONSIDERED BY ITAT, MUMBAI BENCH WAS AS TO WHETHER HOARDINGS WERE BUILD INGS ENTITLED TO 10% DEPRECIATION OR PLANT ENTITLED TO DEPRECIATION AT 1 5%. THE TRIBUNAL IN PARA 43 OF ITS ORDER HELD THAT ADVERTISING HOARDING STRUCTURES WHI CH ARE PERMANENT STRUCTURES EMBEDDED IN THE BUILDING HAVING FOUNDATION BEING ER ECTED AND CONSTRUCTED BY THE ASSESSEE AND WAS BUILDING AND THE ASSESSEE WAS ENT ITLED TO CLAIM DEPRECIATION AT 10%. IT WAS SUBMITTED BY HIM THAT THE CIT IN THE IMPUGNE D ORDER HAS REFERRED TO THE ADVANCEMENT OF TECHNOLOGY AND SUSTAINABLE MATERIALS BEING USED IN THE HOARDING STRUCTURES AND THE LIGHT OF THE AFORESAID DEVELOPME NT HAS ONLY REMANDED THE ISSUE TO THE AO FOR FRESH CONSIDERATION AND THEREFORE ORDER OF T HE CIT SHOULD BE UPHELD. 11. WE HAVE GIVEN A VERY CAREFUL CONSIDERATION TO THE RIVAL SUBMISSIONS. AS WE HAVE ALREADY SEEN ABOVE THAT THE FACTS OF THE CASE GO TO SHOW THAT THE AO MADE ENQUIRIES ON THIS ISSUE AND AFTER BEING SATISFIED WITH THE CLAIM OF THE ASSESSEE ALLOWED THE CAL OF DEPRECIATION ON HOARDINGS AT 100%. ORDER OF THE AO WAS IN TUNE WITH THE ORDER OF THE TRIBUNAL IN THE PAST WHICH HAS BEEN ACCEPTED BY THE REVENUE. IN FACT EVEN FOR THE SUBSEQUENT A.Y.2009-10 THE ISSUE WAS BEFORE THE TRI BUNAL AND IT HAD DECIDED IN FAVOUR OF THE ASSESSEE. IN SUCH CIRCUMSTANCES WE ARE OF TH E VIEW THAT THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF RUSSEL P ROPERTIES PVT.LTD (SUPRA) WILL BE APPLICABLE AND THE CIT COULD NOT HAVE INVOKED HIS J URISDICTION U/S 263 OF THE ACT. THE FACTS OF THE CASE BEFORE THE HONBLE CALCUTTA HIGH COURT WAS THE TRIBUNAL IN THE EARLIER AY OF AN ASSESSEE HELD THAT MAINTENANCE AND SERVICE CHARGES RECEIVED BY AN ASSESSEE WERE ASSESSABLE UNDER THE HEAD 'BUSINESS' AND NOT A SSESSABLE UNDER THE HEAD 'PROPERTY'. 7 ITA NO.2044/KOL/2013 VANTAGE ADVERTISING PVT. LTD. A.YR.2008-09 7 FOLLOWING THE DECISION OF THE TRIBUNAL, THE ITO IN A SUBSEQUENT AY PROCEEDED TO ASSESS SUCH INCOME UNDER THE HEAD 'BUSINESS'. THE CIT IN E XERCISE OF HIS POWERS U/S.263 OF THE ACT FELT THAT SUCH INCOME SHOULD HAVE BEEN ASSE SSED TO TAX UNDER THE HEAD 'PROPERTY' AS IN RESPECT OF THE PRIOR YEARS' FINDINGS REFERENC E APPLICATION WAS PENDING BEFORE THE HIGH COURT. THE HONBLE HIGH COURT HAD TO DECIDE AS TO WHETHER IN THOSE CIRCUMSTANCES, CAN IT BE SAID THAT THE ITO WHO HAD ACCEPTED THE TRIBUNAL'S DECISION AS CORRECT AND APPLIED THAT DECISION TO THE FACTS OF T HIS CASE ACTED ERRONEOUSLY AND HIS SUCH ACTION CAUSED PREJUDICE TO THE INTERESTS OF THE REV ENUE. THE HONBLE HIGH COURT HELD THAT AS A MATTER OF FACT WHENEVER THERE IS A DECISI ON OF THE HIGHER APPELLATE AUTHORITY, THE SUBORDINATE AUTHORITIES ARE BOUND TO FOLLOW THE SAI D DECISION IF JUDICIAL DISCIPLINE IS TO BE MAINTAINED. IN THE AFORESAID VIEW OF THE MATTER THE HONBLE COURT HELD THAT THE CONDITIONS FOR EXERCISE OF THE POWER UNDER S. 263, NAMELY, THAT THERE MUST BE MATERIAL FOR THE CIT TO CONSIDER THAT THE ORDER PASSED BY TH E ITO WAS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE WERE NO T FULFILLED. THE PROPOSED EXERCISE OF THE POWER UNDER S. 263 WAS HELD TO BE ILLEGAL AND W ITHOUT JURISDICTION. 12. WITH REGARD TO THE POLICY GUIDELINES ON DISPLA Y OF ADVERTISEMENT POINTED OUT BY THE LD. DR AS RIGHTLY CONTENDED BY THE LD. COUNSEL FOR THE ASSESSEE THIS WAS ONLY A DRAFT POLICY 2009. IN ANY EVENT THE CIT IN THE IMPUGNED O RDER HAS NOT, ON THE BASIS OF ANY MATERIAL AVAILABLE BEFORE HIM, COME TO A CONCLUSION THAT THE HOARDINGS ON WHICH THE ASSESSEE CLAIMED DEPRECIATION AT 100% WERE STRUCTUR ALLY SOUND SO AS TO BE REGARDED ANY BUILDING. THE DECISION OF THE ITAT MUMBAI BENCH IN THE CASE OF ASIAN ADVERTISING (SUPRA) IS A CASE WHERE THE QUESTION WAS WHETHER HO ARDINGS CONSTITUTE BUILDING OR PLANT. IN OUR VIEW THIS CANNOT BE SAID TO BE A PRECEDENT I N SO FAR AS THE ISSUE INVOLVED IN THE PRESENT CASE IS CONCERNED. WE ARE ALSO OF THE VIEW THAT THE CIT IN EXERCISE OF HIS POWERS U/S 263 OF THE ACT HAS TO COME TO A DEFINITE CONCLUSION AS TO HOW THE ORDER OF THE AO WAS ERRONEOUS. HE CANNOT SET ASIDE THE ORDE R OF AO AND DIRECT AN ENQUIRY ON THE QUESTION WHETHER HOARDING STRUCTURE WOULD BE IN THE NATURE OF PURELY TEMPORARY ERECTION. IN OTHER WORDS THE CIT COULD INVOKE THE J URISDICTION U/S 263 OF THE ACT ONLY ON 8 ITA NO.2044/KOL/2013 VANTAGE ADVERTISING PVT. LTD. A.YR.2008-09 8 A FINDING THAT HOARDINGS WERE NOT PURELY TEMPORARY ERECTION AND SUCH FINDING HAS TO BE SUSTAINABLE IN LAW. IT IS ONLY THEN THE CIT CAN MAK E OUT A CASE THAT ORDER OF AO WAS ERRONEOUS. IN THE PRESENT CASE THE CIT HAS NOT GIVE N SUCH A FINDING. EVEN ON THIS BASIS, WE ARE OF THE VIEW THAT ORDER U/S 263 OF THE ACT CA NNOT BE SUSTAINED. 13. FOR THE REASONS GIVEN ABOVE WE HOLD THAT THE O RDER OF AO WHICH WAS SOUGHT TO BE REVISED IN THE IMPUGNED ORDER OF CIT WAS NOT ERRONE OUS. THEREFORE ORDER U/S 263 OF THE ACT CANNOT BE SUSTAINED. THE SAME IS HEREBY QUASHED AND THE APPEAL OF THE ASSESSEE IS ALLOWED. 14. IN THE RESULT THE APPEAL OF THE ASSESSEE I S ALLOWED. ORDER PRONOUNCED IN THE COURT ON 10.08.20 16. SD/- SD/- [DR.ARJUN LAL SAINI] [ N.V.VASUD EVAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 10.08.2016. [RG PS] COPY OF THE ORDER FORWARDED TO: 1. VANTAGE ADVERTISING PRIVATE LIMITED, C-56, FIRS T AVENUE, ANNA NAGAR EAST, CHENNAI-600102. 2. C.I.T. IV, KOLKATA. 3. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER ASSTT.REGISTRAR, ITAT, KOLKATA BENCHES 9 ITA NO.2044/KOL/2013 VANTAGE ADVERTISING PVT. LTD. A.YR.2008-09 9