D.C.I.T , CENTRAL CIRCLE - II , JALANDHAR V. M/S MBD PRINTOGRAPHICS PVT LTD , JALANDHAR

ITA 244/ASR/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 7100 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 8 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 08-01-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 04-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PARWINDER KAUR
• Keywords: Depreciation; Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CAMP BENCH AT JALANDHAR BEFORE SH. N. K. SAINI, HONBLE VICE PRESIDENT AND SH. RAVISH SOOD, JUDICIAL MEMBER ITA NO.244/ASR./2017 : ASSTT. YEAR : 2013-14 DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-II, JALANDHAR VS M/S MBD PRINTOGRAPHICS PVT. LTD., MBD HOUSE, RAILWAY ROAD, JALANDHAR (APPELLANT) (RESPONDENT) PAN NO. AAACM9208R ASSESSEE BY : SH. SUDHIR SEHGAL, ADV. REVENUE BY : SMT. PARWI NDER KAUR, CIT DR DATE OF HEARING : 17.01.2019 DATE OF PRONOUNCEMENT : 17.01.2019 ORDER PER N. K. SAINI, VICE PRESIDENT: THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE ORD ER DATED 17.02.2017 OF LD. CIT(A)-I, JALANDHAR. 2. FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEA L: (I) WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS NOT ERRED IN DELETING ADDITION O N ACCOUNT OF INTEREST FREE LOAN GIVEN TO SISTER CONCE RNS WHEN ASSESSEE HAS NOT JUSTIFIED BUSINESS EXPEDIENC Y AND FAILED TO PROVIDE NECESSARY DETAILS REGARDING BUSINESS PURPOSE BEHIND INVESTING MONEY IN SISTER CONCERNS. (II) WHETHER ON THE FACTS AND CIRCUMSTANCES CIT(A) WAS RIGHT IN ALLOWING DEPRECIATION WITHOUT FILING R EVISED RETURN BY THE ASSESSEE WHICH HAS RIGHTLY BEEN DISAL LOWED BY THE AO. ITA NO. 244/ASR./2017 MBD PRINTOGRAHICS PVT. LTD. 2 (III) THE APPELLANT CRAVES LEAVE TO ADD OR AMEND TH E GROUNDS OF APPEAL ON OR BEFORE IS HEARD AND DISPOSE D OFF. 3. AS REGARDS TO THE FIRST ISSUE RAISED VIDE GROUND NO. (I), THE LD. COUNSEL FOR THE ASSESSEE AT THE VERY OUTSET STATED THAT THIS ISSUE IS SQUARELY COVERED BY THE JUDGMENT OF THE HONBLE JUR ISDICTIONAL HIGH COURT IN ASSESSEES OWN CASE FOR THE ASSESSMEN T YEAR 2010-11 IN ITA NO. 94/2017, ORDER DATED 08.08.2017 (COPY OF THE SAID ORDER WAS FURNISHED WHICH IS PLACED ON RECORD). 4. IN HER RIVAL SUBMISSIONS, THE LD. CIT DR ALTHOUG H SUPPORTED THE ORDER OF THE AO BUT COULD NOT CONTROVERT THE AF ORESAID CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE. 5. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PA RTIES AND THE MATERIAL AVAILABLE ON THE RECORD. IT IS NOTICED THA T AN IDENTICAL ISSUE HAVING SIMILAR FACTS WAS A SUBJECT MATTER OF THE DE PARTMENTAL APPEAL FOR THE ASSESSMENT YEAR 2010-11 BEFORE THE H ONBLE JURISDICTIONAL HIGH COURT AGAINST THE ORDER OF THE ITAT AMRITSAR BENCH IN ITA NO. 534/ASR./2014, ORDER DATED 13.06.2 016 IN ASSESSEES OWN CASE. THEIR LORDSHIPS WHILE DISMISSI NG THE APPEAL OF THE DEPARTMENT OBSERVED IN PARA 4 OF THE ORDER D ATED 08.08.2017 AS UNDER: 4. LEARNED COUNSEL FOR THE PARTIES WERE AD-IDEM TH AT QUESTION NOS.(I) AND (II) RELATING TO DELETION OF A DDITION OF? 1,22,51,965/- ON ACCOUNT OF DISALLOWANCE OF INT EREST EXPENDITURE STANDS CONCLUDED BY THE DECISION DATED 17.4.2017 PASSED BY THIS COURT IN ITA NO.163 OF 201 7 [THE PR. COMMISSIONER OF INCOME TAX (CENTRAL), LUDHIANA V. SHRI SATISH BALA MALHOTRA, LEGAL HEIR O F ITA NO. 244/ASR./2017 MBD PRINTOGRAHICS PVT. LTD. 3 SHRI ASHOK KUMAR MALHOTRA, PROP. M/S MODERN PUBLISHERS, MBD HOUSE, RAILWAY ROAD, JALANDHAR] WHEREBY THE QUESTIONS HAVE BEEN DECIDED AGAINST THE REVENUE. ACCORDINGLY, QUESTION NOS. (I) AND (II) AR E DECIDED AGAINST THE REVENUE. 6. IN VIEW OF THE ABOVE, WE DO NOT SEE ANY MERIT IN THIS GROUND OF THE DEPARTMENT SINCE THE ISSUE HAS NOW BEEN SETT LED BY THE HONBLE JURISDICTIONAL HIGH COURT IN FAVOUR OF THE ASSESSEE. 7. VIDE GROUND NO. (II), THE GRIEVANCE OF THE DEPAR TMENT RELATES TO THE DEPRECIATION IN RESPECT OF COPIER UNIT AND P APER UNIT. 8. THE FACTS RELATED TO THIS ISSUE IN BRIEF ARE THA T THE AO DISALLOWED THE CLAIM OF DEPRECIATION OF THE ASSESSE E BY OBSERVING THAT THE ASSESSEE HAD MADE THE CLAIM FOR DEDUCTION OF DEPRECIATION WITHOUT FILING THE REVISED RETURN. 9. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND SUBMITTED THAT IT HAD OMITTED THE CLAIM OF CERTAIN DOCUMENTS OF THE COPIER UNIT AND PAPER UNIT BUT THE SAID CLAIM WAS ADMISSIBLE BECAUSE NO NEW CLAIM WAS MADE BY THE ASS ESSEE WHO HAD FILED THE DETAILS IN ITS TAX AUDIT REPORT UNDER FORM 3CB OF THE DEPRECIATION WHICH WAS ALLOWABLE ON ITS ASSETS AS P ER THE INCOME TAX ACT. THE RELIANCE WAS PLACED ON THE JUDGMENT OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS R AMCO INTERNATIONAL REPORTED AT (2011) 332 ITR 306. ITA NO. 244/ASR./2017 MBD PRINTOGRAHICS PVT. LTD. 4 10. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSION S OF THE ASSESSEE ALLOWED THE CLAIM OF DEPRECIATION BY OBSER VING IN PARA 15 OF THE IMPUGNED ORDER WHICH READ AS UNDER: 15. IN THE INSTANT CASE, IT IS CLEAR THAT THE ASSE SSEE HAD FILED IN ITS TAX AUDIT REPORT UNDER FORM 3CD, THE DEPRECIATION THAT WAS ALLOWABLE ON ITS ASSETS AS PE R THE I.T. ACT. HOWEVER IN THE COMPUTATION OF INCOME THE ASSESSEE DID NOT CLAIM DEPRECIATION FOR THE COPIER UNIT AND THE PAPER UNIT. THEREFORE THE FACT THAT THE DEPRECIATION WAS DUE AND WAS CLAIMED BY THE ASSESSE E IS CLEAR FROM THE TAX AUDIT REPORT. MERELY BECAUSE IT WAS NOT MENTIONED IN THE COMPUTATION CANNOT TAKE AWAY FROM THE STATUTORY DEDUCTION OF DEPRECIATION ALLOWABLE TO TH E ASSESSEE. THE ASSESSING OFFICER OUGHT TO HAVE ALLOW ED THE SAME DURING ASSESSMENT PROCEEDINGS, AS HAS BEEN HEL D BY THE HON. PUNJAB & HARYANA HIGH COURT IN THE ABOVE QUOTED DECISION. THE ASSESSING OFFICER IS THEREFORE DIRECTED TO ALLOW THE DEPRECIATION CLAIM OF THE ASS ESSEE AFTER APPROPRIATE VERIFICATION INCLUDING OF NEW ASS ETS PURCHASED BY UJE ASSESSEE DURING THE YEAR. 11. NOW THE DEPARTMENT IS IN APPEAL. THE LD. CIT DR SUPPORTED THE ORDER OF THE AO AND THE LD. COUNSEL FOR THE ASS ESSEE SUBMITTED THAT IT WAS NOT A NEW CLAIM AND THAT THE RELEVANT M ATERIAL WAS AVAILABLE ON THE RECORD IN TAX AUDIT REPORT. THEREF ORE, THE LD. CIT(A) WAS FULLY JUSTIFIED IN ALLOWING THE CLAIM AF TER FOLLOWING THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT I N THE CASE OF CIT VS RAMCO INTERNATIONAL (SUPRA). 12. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON TH E RECORD. IN THE PRESENT CASE, IT IS AN ADMITTED FACT THAT THE ASSES SEE INADVERTENTLY COULD NOT CLAIM THE DEPRECIATION IN COMPUTATION OF INCOME. ITA NO. 244/ASR./2017 MBD PRINTOGRAHICS PVT. LTD. 5 HOWEVER, THAT CLAIM WAS MADE IN THE TAX AUDIT REPOR T ATTACHED WITH THE INCOME TAX RETURN WHICH WAS AVAILABLE ON THE RE CORD. THEREFORE, THE LD. CIT(A) RIGHTLY DIRECTED THE AO TO ALLOW THE DEPRECIATION CLAIMED BY THE ASSESSEE BY FOLLOWING THE JUDGMENT O F THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS RAM CO INTERNATIONAL (SUPRA). WE, THEREFORE, DO NOT SEE AN Y VALID GROUND TO INTERFERE WITH THE FINDINGS O THE LD. CIT(A). 13. IN THE RESULT, THE APPEAL OF THE DEPARTMENT IS DISMISSED. (ORDER PRONOUNCED IN THE COURT ON 17/01/2019) SD/- SD/- (RAVISH SOOD) (N. K. SAINI) JUDICIAL MEMBER V ICE PRESIDENT DATED: 17/01/2019 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR