A-Team Information Technology Ltd., Erode V. ITO, Erode

ITA 2272/CHNY/2016

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3231 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 6 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 01-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S BHARATHCIT
• Assessee Lawyers: K VENKATESH
• Keywords: Depreciation; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: CHE NNAI (CAMP AT COIMBATORE) . . . , , BEFORE SHRI N.R.S. GANESAN , JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBE R ./I.T.A.NO.2272/CHNY/2016 ( / ASSESSMENT YEAR: 2011-12) M/S. A-TEAM INFORMATION TECHNOLOGY LTD., NO.121/122, SKS BUILDING, PERUNDURAI ROAD, ERODE. VS THE INCOME TAX OFFICER, WARD -1(4), ERODE. PAN: AAECA 5449C ( /APPELLANT) ( /RESPONDENT) ./I.T.A.NOS.1891 & 1892/CHNY/2016 & C.O.NO.114 & 115/CHNY/2016 ( / ASSESSMENT YEARS: 2011-12 & 2012-13) THE INCOME TAX OFFICER, WARD -1(4), ERODE. VS M/S. A-TEAM INFORMATION TECHNOLOGY LTD., NO.121/122, SKS BUILDING, PERUNDURAI ROAD, ERODE. PAN: AAECA 5449C ( /APPELLANT) ( /RESPONDENT/CROSS OBJECTOR) !' / ASSESSEE BY : SHRI K.VENKATESH, ADVOCATE !' / REVENUE BY : SHRI S.BHARATH, CIT $ %!&' /DATE OF HEARING : 06.02.2020 ()*!&' /DATE OF PRONOUNCEMENT : 06.02.2020 2 ITA NOS.2272, 1891 & 1892/CHNY/2016 CO NOS.114 & 115/CHNY/2016 / O R D E R PER BENCH : BOTH THE ASSESSEE AND REVENUE FILED THE APPEALS AG AINST THE ORDERS PASSED BY THE COMMISSIONER OF INCOME TAX (AP PEALS)-3, COIMBATORE DATED 16.03.2016 & 31.03.2016 FOR THE AS SESSMENT YEARS (AYS) 2011-12 & 2012-13 RESPECTIVELY. THE ASSESSEE HAS ALSO FILED CROSS- OBJECTIONS AGAINST THE VERY SAME ORDER OF THE CIT(A ). THEREFORE, WE HEARD ALL THE APPEALS AND THE CROSS-OBJECTIONS TOGETHER A ND DISPOSING OF THE SAME BY THIS COMMON ORDER. 2. FOR BOTH THE AYS, THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE TO SUBSTANTIATE THE UNSECURE LOAN AND THE CREDITS F OUND IN THE BOOKS OF ACCOUNT BEFORE THE ASSESSING OFFICER (AO). THEREFOR E, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED BEFORE THIS TRIBUNAL THAT TH E MATTER MAY BE REMITTED BACK TO THE FILE OF AO FOR RE-CONSIDERATIO N SO THAT THE ASSESSEE CAN FILE THE NECESSARY EVIDENCE BEFORE THE AO. FOR THE AY 2011-12, THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THER E WAS NO VALUATION OF THE ASSET BEFORE THE PRESENT COMPANY TOOK OVER THE ASSET THEREFORE, THE ASSESSEE HAS TO ESTABLISH THAT THERE WAS A VALUE FO R THE GOODWILL. MOREOVER, DEPRECIATION ON THE SOFTWARE ALSO NEEDS T O BE ESTABLISHED BEFORE THE AO BY PROVIDING NECESSARY MATERIALS. TH E ASSESSEE HAS ALSO 3 ITA NOS.2272, 1891 & 1892/CHNY/2016 CO NOS.114 & 115/CHNY/2016 FILED AN APPEAL WITH REGARD TO DISALLOWANCE MADE BY THE AO TOWARDS UNSECURED LOAN FOR THE AY 2011-12. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT DUE TO HEAVY LOSS, ONE OF THE DIRECT OR COMMITTED SUICIDE AND THE ASSESSEE-COMPANY IS NOT DOING ANY BUSINESS NOW. 3. HAVING HEARD THE LD. COUNSEL FOR THE ASSES SEE AND THE LD. DEPARTMENTAL REPRESENTATIVE, THIS TRIBUNAL IS OF TH E CONSIDERED OPINION THAT THE ASSESSEE HAS TO PRODUCE NECESSARY MATERIAL WITH REGARD TO SOFTWARE ON WHICH THE DEPRECIATION WAS CLAIMED. TH E ASSESSEE HAS ALSO NEEDS TO ESTABLISH THE UNSECURED LOAN FOR THE AY 20 11-12. IN VIEW OF ABOVE, GIVING ONE MORE OPPORTUNITY TO THE ASSESSEE MAY NOT PREJUDICE TO THE INTEREST OF BOTH THE PARTIES. ACCORDINGLY, THE ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ENTIRE ISSU E RAISED FOR CONSIDERATION BEFORE THIS TRIBUNAL IS REMITTED BACK TO THE FILE OF AO. 4. FOR THE AY 2012-13, THE LD. COUNSEL CLAIMS THAT A CONFIRMATION LETTER WAS FILED FROM REDINGOTON (INDIA) LTD. BEFOR E THE AO. HOWEVER, HE FAILED TO CONSIDER THE SAME. IN RESPECT OF OTHER TW O COMPANIES NAMELY M/S. SRI ACL INFOSYS AND RK TECH (INDIA) PVT. LTD., THE ASSESSEE IS WILLING TO FILE NECESSARY MATERIAL BEFORE THE AO. IN VIEW OF THE ABOVE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSE SSEE HAS TO RE-COMPUTE 4 ITA NOS.2272, 1891 & 1892/CHNY/2016 CO NOS.114 & 115/CHNY/2016 THE DIFFERENCE IN THE BOOKS OF ACCOUNT BY PRODUCING THE NECESSARY MATERIAL. ACCORDINGLY, THE ORDERS OF BOTH THE AUTH ORITIES BELOW FOR AY 2012-13 ARE ALSO SET ASIDE AND THE ENTIRE ISSUE SHA LL RE-EXAMINED BY THE AO AFRESH IN THE LIGHT OF THE MATERIAL THAT MAY BE FILED BY THE ASSESSEE IN ACCORDANCE WITH LAW AFTER GIVING A REASONABLE OPPOR TUNITY TO THE ASSESSEE. 5. IN THE RESULT, ALL THE APPEALS AND CROSS OBJECT IONS FILED BY THE ASSESSEE AS WELL AS REVENUE STAND ALLOWED FOR STATI STICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 06 TH FEBRUARY, 2020 AT CHENNAI (CAMP AT COIMBATORE). SD/- ( . ) (S. JAYARAMAN) /ACCOUNTANT MEMBER SD/- ( (( ( . .. . . .. . . . . . ) )) ) (N.R.S. GANESAN) / JUDICIAL MEMBER /CHENNAI, /DATED, THE 06 TH FEBRUARY, 2020. EDN, SR. PS !&-./.*& /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. $ 1& ( )/CIT(A) 4. $ 1& /CIT 5. .2 &34 /DR 6.