ITO, WARD - 35(3), KOLKATA, Kolkata V. Sri Laxmipat Surana, Kolkata

ITA 2457/KOL/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 4982 (ITAT-KOLKATA)
• Duration Of Justice: 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 13-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M K BISWAS
• Keywords: Depreciation; Revised return
• Section: 32

Judgement Text

ITA NO.2457/KOL/2017 SRI LAXMIPAT SURANA A.Y.2014-1 5 1 IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH D KOL KATA [BEFORE HONBLE SHRI J.SUDHAKAR REDDY, AM & SHRI S.S.VISWANETHRA RAVI, JM] ITA NO.2457/KOL/2017 ASSESSMENT YEAR : 2014-15 I.T.O., WARD-35 (3) . -VERSUS- SHRI LAXMIPAT SURANA KOLKATA KOLKATA (PAN: AKQPS 7037 P) (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI M.K.BISWAS, ADDL. CIT FOR THE RESPONDENT: SHRI ANIL KOCHAR, ADVOCATE DATE OF HEARING : 06.09.2018. DATE OF PRONOUNCEMENT : 24.10.2018. ORDER PER J.SUDHAKAR REDDY, AM: THIS IS AN APPEAL FILED BY THE REVENUE DIRECTED AGA INST THE ORDER OF THE COMMISSIONER OF INCOME TAX-(A)-10, DATED 24.09.201 7 PASSED U/S 250 OF THE INCOME TAX ACT, 1961 (THE ACT ) RELATING TO A.Y. 2014-15 ON THE FOLLOWING GROUNDS :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED IN ALLOWING THE DEPRECIATION TO THE ASSESSEE WHO IS NO T THE LEGAL OWNER OF THE PROPERTY. 2. THE LD. CIT(A) HAS ERRED IN HOLDING THE VIEW THA T THE ASSESSEE IS CARRYING ON BUSINESS IN TERMS OF EXPLANATION (1) TO SECTION 32 OF THE I.T. ACT, WHEREAS THE ASSESSEE IS DERIVING INCOME FROM A PROPERTY TO WHIC H HE IS A LICENSEE ONLY AND AS SUCH THE SAID EXPLANATION IS NOT APPLICABLE IN THIS CASE. 3. THAT, THE APPELLANT CRAVES LEAVE TO MAKE AN ADDI TION, ALTERATION, AND MODIFICATION OF GROUNDS AT THE APPELLATE STAGE. 2. AFTER HEARING RIVAL CONTENTIONS, WE FIND THAT T HE ISSUE IN QUESTION IS COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY T HE DECISION OF A BENCH OF THE TRIBUNAL IN ITA NO.142/KOL/2016 IN ASSESSEES OWN C ASE AND C.O.NO.19/KOL/2016 ORDER DATED 10 TH NOVEMBER, 2017 AS WELL AS THE DECISION OF THE TRIB UNAL IN ITA ITA NO.2457/KOL/2017 SRI LAXMIPAT SURANA A.Y.2014-1 5 2 NO.2398/KOL/2016 FOR A.Y.2012-13 IN ASSESSEES OWN CASE. THE TRIBUNAL AT PARA-5 OF THE ORDER HELD AS FOLLOWS :- 5. WE HAVE HEARD THE RIVAL SUBMISSIONS. WE FIND TH AT THE AFORESAID ISSUES UNDER DISPUTE ARE SQUARELY COVERED BY THE ORDER OF THIS T RIBUNAL IN ASSESSEES OWN CASE IN I.T.A. NO. 142/KOL/2016 FOR ASSESSMENT YEAR 2011 -12 AND C.O. NO. 19/KOL/2016 FOR ASSESSMENT YEAR 2011-12 DATED 10.11 .2017 WHEREIN IT WAS HELD AS UNDER: 6. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES A ND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE FIRST CONTENTION RAISED BY THE LEARNED DR IS THAT THE ASSESSEE HAVING NOT CLAIMED DEPRECIATION ON THE LIC ENCED PROPERTY IN THE RETURN OF INCOME, THE LD. CIT (A) WAS NOT JUSTIFIED TO ALLOW THE CLAIM OF THE ASSESSEE FOR DEPRECIATION WHICH WAS NOT MADE EITHER IN THE ORIGI NAL RETURN OR EVEN BY FILING REVISED RETURN. WE ARE UNABLE TO ACCEPT THIS CONTEN TION OF THE LEARNED DR. IN OUR OPINION, THE RESTRICTION LAID DOWN BY THE HON'BLE S UPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. (SUPRA) WHICH IS RELIED UPON BY THE AS SESSING OFFICER IS APPLICABLE ONLY AT THE ASSESSMENTS STAGE AND THE LD. CIT (A) BEING AN APPELLATE AUTHORITY IS SUFFICIENTLY EMPOWERED TO ENTERTAIN THE CLAIM MADE BY THE ASSESS EE FOR DEPRECIATION FOR THE FIRST TIME BEFORE HIM WITHOUT EVEN FILING THE REVISED RET URN AS CLARIFIED BY THE HON'BLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. (S UPRA) ITSELF. EVEN THE OLD CIRCULAR OF THE CBDT DATED 31.08.1965 RELIED UPON BY THE LEA RNED DR WAS ISSUED IN A DIFFERENT CONTEXT AND THE SAME THEREFORE IS NOT I.T .A. NO. 142 & C.O. NO. 19/KOL/2016 SRI LAXMIPAT SURANA APPLICABLE IN THE PRESENT CONTE XT. AS REGARDS THE CLAIM OF THE ASSESSEE FOR DEPRECIATION ON MERIT, THE LEARNED DR HAS RELIED ON THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF MOTHER HOSPITAL PVT. LTD. VS CIT RENDERED ON MARCH 2, 2017 WHEREIN IT WAS HELD THAT LESSEE UNDER EXPLANATION 1 TO SECTION 32 IS ENTITLED TO DEPRECIATION ON THE COST OF CONSTRUCTIO N INCURRED BY HIM BUT NOT ON THE COST INCURRED BY THE OWNER. AS CLARIFIED BY THE LEARNED COUNSEL FOR THE ASSESSEE IN THIS REGARD, DEPRECIATION IN THE PRESENT CASE WAS CLAIME D BY THE ASSESSEE ONLY ON THE COST OF CONSTRUCTION INCURRED BY HIM. WE, THEREFORE, FIN D NO INFIRMITY IN THE IMPUGNED ORDER OF THE LD. CIT (A) ALLOWING THE CLAIM OF THE ASSESSEE FOR DEPRECIATION ON THE COST OF LICENCED PROPERTY INCURRED BY HIM AND UPHOL DING HIS IMPUGNED ORDER ON THIS ISSUE, WE DISMISS THIS APPEAL FILED BY THE REVENUE. 7. AT THE TIME OF HEARING BEFORE US, THE LEARNED CO UNSEL FOR THE ASSESSEE HAS NOT PRESSED THE ISSUES RAISED IN THE CROSS-OBJECTION FI LED BY THE ASSESSEE. THE CROSS- OBJECTION FILED BY THE ASSESSEE IS ACCORDINGLY DISM ISSED AS NOT PRESSED. RESPECTFULLY FOLLOWING THE AFORESAID DECISION WE DI RECT THE LD. AO TO GRANT DEPRECIATION ON THE COST OF LICENSE PROPERTY INCURR ED BY THE ASSESSEE. RESPECTFULLY FOLLOWING THE SAME WE UPHOLD THE LD. C IT(A)S ORDER AND DISMISS THE APPEAL OF THE REVENUE. ITA NO.2457/KOL/2017 SRI LAXMIPAT SURANA A.Y.2014-1 5 3 3. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMI SSED. O RDER PRONOUNCED IN THE COURT ON 24.10.2018. SD/- SD/- [S.S.VISWANETHRA RAVI] [ J.SUDHAKAR REDDY ] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 24.10.2018. [RG SR.PS] COPY OF THE ORDER FORWARDED TO: 1.SRI LAXMIPAT SURANA, 12, BONFIELD LANE, KOLKATA-7 00001. 2. I.T.O., WARD-35(3), KOLKATA. 3. C.I.T.(A)- 10, KOLKATA 4. C.I.T-12, KOLKAT A 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER, SENIOR PRIVATE SECRETARY HEAD OF OFFICE/D.D.O, ITAT KOLKATA BENCHES