INCOME TAX OFFICER, WARD-1(3), Nagpur V. NAGAR YUWAK SHIKSHAN SANSTHA, Nagpur

ITA 222/NAG/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93394 (ITAT-NAGPUR)
• Duration Of Justice: 1 year(s) 11 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 22-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMITAVA BHATTACHARYA
• Keywords: Depreciation; Capital expenditure
• Section: 143(3); 32; 11

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR. BEFORE SHRI MUKUL K. SHRAWAT, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. I.T.A. NO.222/NAG/2013 ASSESSMENT YEAR :2007-08 THE INCOME-TAX OFFICER, NAGPUR YUWAK SHIKSHAN SANSTHA, WARD-1(3), NAGPUR. V/S. ATRE LAYOUT, KHAMLA, NAGPUR. PAN AAATN0914E APPELLANT. RESPONDENT. APPELLANT BY : SHRI AMITAVA BHATTACHARYA. RESPONDENT BY : SH RI K.P. DEWANI.. DATE OF HEARING - 06-05-2015 DATE OF ORDER 20 TH MAY,2015 O R D E R PER SHRI MUKUL K. SHRAWAT, J.M. THIS IS AN APPEAL FILED BY THE REVENUE ARISING FR OM THE ORDER OF LEARNED CIT(APPEALS)-I, NAGPUR DATED 06-03-2013. THE GRO UNDS RAISED BY THE REVENUE ARE REPRODUCED BELOW: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE CIT(A) ERRED IN ALLOWING DEPRECIATION OF ` .33,12,221/- CLAIMED IN INCOME AND EXPENDITURE ACCOUNT THOUGH THE COST OF WHICH IS AL READY ALLOWED AS DEDUCTION. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) ERRED IN IGNORING THE FINDING OF THE SC IN THE CAS E OF ESCORT 199 ITR 43 IN 2 WHICH THE COURT HAS HELD THAT THE DOUBLE DEDUCTION CANNOT BE PRESUMED UNLESS SPECIFICALLY PROVIDED FOR BY THE LAW? 2. THE SHORT ISSUE AS RAISED FROM THE SIDE OF THE R EVENUE EMERGING FROM ASSESSMENT ORDERS PASSED UNDER SECTION 143(3) DATE D 29-12-2009 AND WAS WHETHER THE DEPRECIATION AMOUNTING TO ` .33,12,221/- IS ADMISSIBLE TO THE ASSESSEE TRUST WHO HAS CLAIMED EXEMPTION UNDER SECT ION 10(23)(C)(VI). THE OBJECTION OF THE ASSESSING OFFICER WAS THAT IN THE C ASE OF A TRUST WHEN THE CAPITAL EXPENDITURE HAS ALREADY BEEN ALLOWED THEN THE DEPR ECIATION COULD NOT AGAIN BE ALLOWED AS HELD IN THE CASE OF ESCORTS LIMITED 108 CTR 275 (199 ITR 43) (SC). ANOTHER OBSERVATION HAS ALSO BEEN MADE BY THE ASSES SING OFFICER THAT AS PER THE ORDER OF HONBLE SUPREME COURT, ONCE A DEDUCTION UN DER SECTION 35 WAS ALLOWED THEN EVEN UNDER THE AMENDED PROVISIONS OF THE ACT T HE DEPRECIATION UNDER SECTION 32 IS NOT AVAILABLE TO THE ASSESSEE. THE AS SESSING OFFICER HAS, THEREFORE, DISALLOWED THE CLAIM OF DEPRECIATION. 3. WHEN THE MATTER WAS CARRIED BEFORE THE FIRST APP ELLATE AUTHORITY, LEARNED CIT(APPEALS) HAS FOLLOWED A DECISION OF HONBLE BOM BAY HIGH COURT PRONOUNCED IN THE CASE OF INSTITUTE OF BANKING PERSONNEL SERVI CES 264 ITR 110 AND DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSEE AS UNDER : DURING THE COURSE OF APPELLATE PROCEEDINGS, THE AUTHORIZED REPRESENTATIVE OF THE APPELLANT HAS RELIED ON DECI SIONS RENDERED BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. INSTITUTE OF BANKING PERSONNEL SERVICES 264 ITR 110 (BOM) AND DIT(E) VS . M/S IN DO FRENCH CHAMBER OF COMMERCE & INDUSTRY DATED 16/01/2013. THE HONBLE HIGH COURT IN THE CASE OF M/S INDO FRENCH CHAMBER OF COMMERCE & INDU STRY VS DIRECTOR OF INCOME TAX (EXEMPTION), MUMBAI HAD DEALT WITH THE IDENTICAL FACTS AND DETERMINED THE FOLLOWING JUDGEMENT : 3 WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE TRIBUNAL WAS RIGHT IN IGNORING THE STAND OF REVENUE THAT ALLOWING OF DEPRECIATION ON THE ASSETS, THE COST OF WHICH HAS ALREADY BEEN ALLOWED AS A DEDUCTION IN VIEW OF THE DECISI ON OF THE HONBLE SUPREME COURT IN THE CASE OF ESCORTS LIMITED V/S UNION OF INDIA 199 ITR 43. SINCE THE TRIBUNAL HAS FOLLOWED THE DECISION OF T HIS COURT IN THE CASE OF COMMISSIONER OF INCOME TAX V/S. INSTITUTE OF B ANKING PERSONNEL SLECTION REPORTED IN 264 ITR 110, WE FIND NO REAS ON TO ENTERTAIN THE PRESENT APPEAL. THE LEARNED ADVOCATE FOR THE REVE NUE IS NOT ABLE TO DISTINGUISH THE SAID DECISION. I HAVE GONE THROUGH THE SUBMISSIONS OF THE APPELL ANT AND THE FACTS OF THE CASE AND THE CASE LAWS SUBMITTED BY THE AUTHORIZED REPRESENTATIVE OF THE APPELLANT. THE ASSESSING OFFICER HAS PLACED RELIA NCE ON THE JUDGEMENT OF HONBLE SUPREME COURT IN 199 ITR 43 WHICH HAS BEEN DULY CONSIDERED BY THE HONBLE BOMBAY HIGH COURT IN THE ABOVE REFERRE D JUDGEMENT I.E. DIT(E) VS . M/S INDO FRENCH CHAMBER OF COMMERCE & INDUSTR Y DATED 16/01/2013. RESPECTFULLY FOLLOWING THE DECISION OF HONBLE HIG H COURT OF MUMBAI, I CONSIDER THAT THE EXCLUSION OF DEPRECIATION BY THE ASSESSING OFFICER FOR COMPUTATION OF INCOME IS NOT JUSTIFIED. 4 IN RESPECT OF THIS LEGAL ISSUE, WE HAVE HEARD BOT H THE SIDES. FROM THE SIDE OF THE REVENUE LEARNED DR MR. AMITAVA BHATTACHARYA HAS VEHEMENTLY PLACED RELIANCE ON AN ORDER OF ITAT, COCHIN IN THE CASE OF DY. DIRECTOR OF INCOME-TAX (EXEMPTION) V/S. ADI SANKARA TRUST BEARING ITA NO. 96/COCH/2009 ASSESSMENT YEAR 2006-07 AND V.N. GANGADHARA PANICKER MEMORIAL CHAR ITABLE TRUST ITA NO. 259/COCH/2009 ORDER DATED 16 TH JUNE, 2011 AND ARGUED THAT THE INCOME TAX ACT DID NOT ALLOW A DOUBLE DEDUCTION. ON THE OTHER HAND , FROM THE SIDE OF THE RESPONDENT-ASSESSEE LEARNED A.R. MR. K.P. DEWANI HA S PLACED RELIANCE ON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF DIRECTOR OF INCOME-TAX (EXEMPTION), MUMBAI V/S. M/S INDO FRENCH CHAMBER O F COMMERCE & INDUSTRY 4 (INCOME TAX APPEAL NO. 1447 OF 2012 ORDER DATED 16 TH JUNE, 2013) AND ALSO ON A DECISION OF CIT V/S. INSTITUTE OF BANKING PERSONNEL SELECTIONS 264 ITR 110 (BOM.). 5. WE HAVE PERUSED THE PRECEDENTS CITED FROM BOTH T HE SIDES IN THE LIGHT OF FACTS OF THIS CASE. SINCE THIS TRIBUNAL IS WITHIN T HE JURISDICTION OF HONBLE BOMBAY HIGH COURT, THEREFORE, THE ABOVE CITED DECISIONS AR E TO BE FOLLOWED WITH RESPECT. THE QUESTION BEFORE THE HONBLE HIGH COURT IN THE C ASE OF INSTITUTE OF BANKING PERSONNEL SELECTION (SUPRA) WAS WHETHER, ON THE FA CTS AND IN THE CIRCUMSTANCES OF THE CASE, THE TRIBUNAL WAS RIGHT IN LAW IN DIREC TING THE AO TO ALLOW DEPRECIATION ON THE ASSETS THE COST OF WHICH HAS BEEN FULLY ALLO WED AS APPLICATION OF INCOME UNDER S. 11 IN THE PAST YEARS?. THIS QUESTION WAS ANSWERED IN AFFIRMATIVE I.E. IN FAVOUR OF THE ASSESSEE. HENCE ACCORDING TO US, THE LEGAL ISSUE AS RAISED FROM THE SIDE OF THE REVENUE IS SQUARELY COVERED BY THE DECI SION OF HONBLE BOMBAY HIGH COURT IN FAVOUR OF THE ASSESSEE. RESULTANTLY, WE FI ND NO FORCE IN THE GROUND OF THE REVENUE AND THE SAME IS HEREBY DISMISSED. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DI SMISSED. SD/- SD/- (SHAMIM YAHYA) (MUKUL K. SHRAWAT) ACCOUNTANT MEMBER JUDICIAL MEMBER. NAGPUR, DATED: 20 TH MAY, 2015. 5 COPY OF ORDER FORWARDED TO : 1. THE ASSESSEE. 2. REVENUE. 3. THE CIT(A) 4. THE CIT, NAGPUR. 5. THE D.R., ITAT, NAGPUR. 6. GUARD FILE. T RUE COPY. BY ORDER ASSISTANT REGISTRAR, ITAT, N AGPUR WAKODE.