ITO 8(1)-2, MUMBAI V. BISLERI INTERNATIONAL P. LTD, MUMBAI

ITA 2623/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1855 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Next Hearing Date: 12-03-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 24-04-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PARAMJEET SINGH
• Assessee Lawyers: R R VORANIMESH VORA
• Keywords: Depreciation; Proportionate interest; Capital expenditure
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, I BENCH, MUMBAI. BEFORE S/SHRI S.V.MEHROTRA, AM & V.DURGA RAO,JM I.T.A. NO. 2623/MUM/2009 ASSESSMENT YEAR: 2005-06 THE I.T.O. 8(1)(2), V. BISLERI INTERNATIONAL PVT . LTD., AAYAKAR BHAVAN, M.K. ROAD, WESTERN EXPRESS HIGHW AY, MUMBAI. CHAKALA, ANDHERI(W), MUMBAI-99 PA NO.AACCA 4355 K (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI PARAMJEET SINGH RESPONDENT BY : SHRI R.R.VORA/NIMESH VORA O R D E R PER S.V.MEHROTRA, AM THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER DATED 2.2.2009 OF LD CIT (A)-VIII, MUMBAI FOR THE ASSESSMENT YEAR 2005-0 6. 2. FACTS IN BRIEF ARE THAT THE ASSESSEE COMPANY, IN THE RELEVANT ASSESSMENT YEAR, WAS IN THE BUSINESS OF MANUFACTURING OF PACKAGED DRINKI NG WATER, PVC CAPS, BOTTLES, JARS AND USED FOR ITS OWN PURPOSE TO TRADE IN BOTTLED WATER. IT FILED ITS RETURN OF INCOME SHOWING BOOK PROFIT U/S.115JB AT RS.3,93,41,010/- AND TAX P AYABLE UNDER MAT AT RS.29,50,576/-. THE INCOME UNDER THE NORMAL PROVISIONS OF INCOME TA X ACT WAS DETERMINED AT RS. NIL. THE ASSESSMENT WAS COMPLETED AT A TOTAL INCOME OF R S.NIL UNDER THE NORMAL PROVISIONS, INTER ALIA, AFTER MAKING FOLLOWING DISALLOWANCES: 1) DISALLOWANCE OF PROPORTIONATE INTEREST ON LOANS AND : RS.64,12,644 ADVANCES TO GROUP CONCERNS 2) DISALLOWANCE OF INTEREST ON SHARE INVESTMENT : RS.57,60,501 3) DISALLOWANCE OF INCREMENTAL DEPOSIT : RS.58,7 1,842 4) DISALLOWANCE OF DEPRECIATION ON TRUCKS : RS.14 ,62,450 ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 2 THESE DISALLOWANCES WERE DELETED BY LD CIT (A). BE ING AGGRIEVED WITH THE ORDER OF LD CIT (A), THE DEPARTMENT IS IN APPEAL BEFORE US ON T HE FOLLOWING GROUNDS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD CIT (A) ERRED IN DELETING THE ADDITION OF INTEREST OF R S.64.12 LACS ON ACCOUNT OF INTEREST BEARING LOANS ADVANCED TO SISTER CONCERN W ITHOUT CHARGING ANY INTEREST BY THE ASSESSEE COMPANY WITHOUT APPRECIATI NG THE FACTS OF THE CASE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD CIT (A) ERRED IN DELETING THE ADDITION OF RS.57.60 LACS ON ACCOUNT OF INTEREST EXPENDITURE AS THE ASSESSEE HAD DIVERTED INTEREST B EARING FUNDS IN MAKING INVESTMENT IN MUTUAL FUNDS WHICH WERE CAPITAL IN NA TURE AND WHICH WERE FOR NON-BUSINESS PURPOSES WITHOUT APPRECIATING THE FACTS OF THE CASE. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD CIT (A) ERRED IN DELETING THE ADDITION OF RS.58.71 LACS MADE ON ACCOUNT OF INCREMENTAL DEPOSITS RECEIVED BY THE ASSESSEE FROM ITS CONSTITUENTS IN RESPECT OF JARS/CANS USED IN PACKAGED DRINKING WATE R WITHOUT APPRECIATING THE FACTS OF THE CASE. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD CIT (A) ERRED IN DELETING THE ADDITION OF RS.14.62 LAKH S ON ACCOUNT OF DEPRECIATION IN RESPECT OF TRUCKS BY APPLYING DEPRE CIATION @ 25% AS AGAINST 40% CLAIMED BY THE ASSESSEE WITHOUT APPRECI ATING THE FACTS OF THE CASE. 3. APROPOS GROUND NO.1, FACTS ARE THAT FROM SCHEDUL E-N TO THE P&L ACCOUNT, THE AO NOTICED THAT A SUM OF RS.1,21,73,155/- WAS DEBIT ED UNDER THE HEAD INTEREST, FINANCE & BANK CHARGES . THE AO EXAMINED THE BALANCE SHEE T AND NOTED THAT THE FUNDS WERE BORROWED FROM BANKS WHICH WERE UTILIZED FOR INVESTM ENT IN EQUITY SHARES AND ADVANCED AS LOAN TO GROUP CONCERNS. THE DETAILS FROM THE BA LANCE SHEET, AS REPRODUCED IN THE ASSESSMENT ORDER AT PAGES 2 & 3, ARE AS UNDER:- SECURED LOAN YEAR ENDING 31.3.2005(RS.) YEAR ENDING 31.3.2004(RS.) LOAN FROM ABN AMRO BANK 19,98,73,401 NIL LOAN FROM CITY BANK 21,16,713 NIL LOAN FROM ICICI BANK LTD. 7,16,596 12,06,956 LOAN FROM CITY CORPORATION FINANCE LTD. 45,301 NIL TOTAL 20,27,52,011 12,06,956 ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 3 UNSECURED LOAN RAISED: FROM COMPANIES RS.71,080 RS.7,48,23,182 FROM A DIRECTOR RS. NIL RS.6,63,74,556 RS.71,080 RS.4,11,97,738 INVESTMENTS: TOTAL INVESTMENTS RS.22,25,17,936 RS.12,69,91,326 THE ASSESSING OFFICER AFTER DETAILED VERIFICATION O F FACTS, DISALLOWED RS.64,12,654/- BEING INTEREST ATTRIBUTABLE TO BORROWING BY GROUP CONCERN S VIZ; PARLE BISLERI PVT LTD., AND PARLE (EXPORTS) PVT LTD FOR THE FOLLOWING TWO REASONS: 1. THE INTEREST BEARING FUNDS WERE NOT UTILIZED F OR ASSESSEES OWN BUSINESS, AND, 2. THE ASSESSEE COMPANY DID NOT PROVIDE THE INFORMA TION AS REQUIRED BY THE QUESTIONNAIRE TO SUPPLY DATES ON WHICH THE INTEREST BEARING FUNDS WERE GRANTED TO THE GROUP CONCERNS TO ESTABLISH THE NEXUS. FURTHERM ORE, IT DID NOT PROVIDE THE RATE OF INTEREST ON WHICH THE FUNDS WERE RAISED. 4. BEFORE LD CIT (A), THE ASSESSEE SUBMITTED THAT I N ITS OWN CASE FOR THE ASSESSMENT YEAR 2002-03, LD CIT (A) HAD DELETED THE DISALLOWAN CE. FURTHER, IT WAS POINTED OUT THAT THE ADVANCES TO GROUP CONCERNS WERE IN THE NATURE O F BUSINESS ADVANCE AND, THEREFORE, IN VIEW OF THE DECISION OF THE HONBLE SUPREME COURT I N THE CASE OF S.A. BUILDERS, 288 ITR 1 (SC), NO DISALLOWANCE WAS CALLED FOR. LD CIT (A) ALLOWED THE ASSESSEES APPEAL, INTER ALIA, OBSERVING THAT THERE WAS NO CHANGE IN FACTS O F THE CASE FROM EARLIER YEARS AND THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F S.A. BUILDERS (SUPRA) WAS DIRECTLY APPLICABLE TO THE FACTS OF THE CASE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE RECORD OF THE CASE. IN THE WRITTEN SUBMISSIONS FILED BEFORE US, IT IS POIN TED OUT THAT THE ASSESSEE HAD SUFFICIENT INTEREST FREE FUNDS OF ITS OWN WHICH WERE UTILIZED FOR GRANTING ADVANCES TO SISTER CONCERNS AND, THEREFORE, IN VIEW OF THE FOLLOWING DECISIONS, NO DISALLOWANCE WAS CALLED FOR: I) RELIANCE UTILITIES AND POWER LTD., 313 ITR 340( BOM) II) HOTEL SAVERA, 239 ITR 795 (MAD) III) COTTON FABRICS LTD., 131 ITR 99 9GUJ) IV) BOMBAY SAMACHAR LTD., 74 ITR 723 (BOM) FURTHER, IT IS STATED THAT THE ASSESSEE WAS DOING B USINESS FOR ONE OF ITS SISTER CONCERNS, I.E. PARLE BISLERI PVT LTD., FROM WHICH, IT BUYS RAW MAT ERIALS AND PACKING MATERIALS SUCH AS ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 4 CAPS, JARS, CARTONS, ETC AND ALSO RECEIVES ROYALTY FROM IT. FURTHER, PARLE BISLERI PVT LTD., IS ONE OF THE MAIN DISTRIBUTORS OF THE ASSESSEE FOR DI STRIBUTING ITS PRODUCTS (MINERAL WATER) IN MUMBAI AND OTHER AREAS. IT WAS FURTHER POINTED OUT THAT WITH REFERENCE TO PAGE 71 OF PB THAT IN EARLIER YEARS AND IN PART OF THIS YEAR, PAR LE BISLERI PVT LTD., HAD GIVEN INTEREST FREE LOANS TO THE ASSESSEE AND IT WAS ONLY DURING THE YE AR THE ASSESSEE HAD GIVEN ADVANCE TO PARLE BISLERI PVT LTD., WHICH WAS RECOVERED BACK IN NOVEMBER, 2005. THUS, IT IS SUBMITTED THAT THE LOAN, IN FACT, WAS GIVEN OUT OF BUSINESS EXPEDIENCY AND, THEREFORE, THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F S.A. BUILDERS (SUPRA) IS SQUARELY APPLICABLE. 6. LD COUNSEL FOR THE ASSESSEE REFERRED TO PAGE 57 OF PB, WHEREIN, THE SUMMARY OF CAPITAL, RESERVE & SURPLUS IS CONTAINED, AS PER WHI CH, THE ASSESSEE HAD CAPITAL AND RESERVE & SURPLUS AS UNDER:- (RS.IN LAKHS) CAPITAL : RS. 46.50 RESERVE & SURPLUS RS.3,984.11 TOTAL: RS.4,030.61 7. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PART IES AND HAVE PERUSED THE RECORD OF THE CASE. FACTS ARE NOT IN DISPUTE. THE INTEREST FREE FUNDS AVAILABLE WITH THE ASSESSEE FULLY COVERED THE ADVANCES TO SISTER CONCE RNS. THEREFORE, IN VIEW OF THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V. RELIANCE UTILITIES AND POWER LTD.,[2009] 313 ITR 340 (BOM), NO DISALLOWANCE WAS CALLED FOR. FURTHER, IN ANY VIEW OF THE MATTER, THE ADVANCE WAS GIVEN OUT OF BUSINESS E XPEDIENCY AND, THEREFORE, IN VIEW OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CA SE OF S.A. BUILDERS (SUPRA), NO DISALLOWANCE WAS CALLED FOR. THIS GROUND IS REJECT ED. 8. APROPOS GROUND NO.2, FACTS ARE THAT THE ASSESSIN G OFFICER EXAMINED THE BALANCE SHEET AND NOTED THAT UNDER THE HEADING INVESTMENT , THE ASSESSEE COMPANY REFLECTED TOTAL INVESTMENT OF RS.22,25,17,936/- AND DURING THE IMME DIATELY PRECEDING YEAR, TOTAL INVESTMENTS WERE RS.12,69,91,326/-. THUS, THE ADDI TIONAL INVESTMENTS DURING THE YEAR UNDER CONSIDERATION WORKED OUT TO RS.9,55,26,610/-. THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD RAISED INTEREST BEARING FUNDS FROM THE BANKS AGGREGATING TO RS.20,27,52,011/-, OUT OF WHICH, INTEREST FREE ADVA NCE GIVEN TO GROUP CONCERNS WAS ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 5 RS.10,68,00,000/- AND THAT UTILIZED FOR THE PURPOSE OF SHARE INVESTMENTS WAS RS.9,59,52,011/-. HE, THEREFORE, CONCLUDED THAT RS .9.59 CRORES WAS UTILIZED FOR THE PURPOSE OF SHARE INVESTMENT, WHICH WAS CAPITAL IN N ATURE. HE OBSERVED THAT INVESTMENT BEING CAPITAL IN NATURE, ANY EXPENDITURE RELATED TO INVESTMENT IS TO BE CONSIDERED AS CAPITAL EXPENDITURE. HE, THEREFORE, DISALLOWED INT EREST COMPONENT RELATING TO SHARE INVESTMENTS OF RS.9.59 CRORES TREATING THE SAME AS CAPITAL EXPENDITURE. HE, ACCORDINGLY, DISALLOWED RS.57,60,501/-. 9. BEFORE LD CIT (A), IT WAS POINTED OUT THAT INVES TMENT IN MUTUAL FUND WAS MADE OUT OF REDEMPTION PROCEEDS OF ANOTHER MUTUAL FUND U NDER SWITCH OVER OPTION OF THE SCHEME AND PROCEEDS FROM SALE OF OTHER ASSETS AND, THEREFORE, NO BORROWED FUNDS WERE UTILIZED FOR MAKING FRESH INVESTMENTS. 10. LD CIT (A) ALLOWED THE ASSESSES APPEAL FOLLOWI NG THE DECISION FOR THE ASSESSMENT YEAR 2002-03 OF HIS PREDECESSOR AND ALSO AFTER TAKI NG NOTE OF THE FACT THAT ALL THE INVESTMENTS MADE DURING THE YEAR FOR THE PURCHASE O F SHARES AND INVESTMENTS IN MUTUAL FUNDS WAS MADE OUT OF THE INCOME GENERATED FROM THE SALE OF OLD INVESTMENTS AND SALE OF PROPERTY AT SAHIBABAD, U.P. 11. LD D.R. RELIED ON THE ORDER OF THE ASSESSING OF FICER. 12. LD COUNSEL FOR THE ASSESSEE REFERRED TO PAGE 6 OF PB FILED ON 30.12.2009, WHEREIN, COMPUTATION OF LONG TERM CAPITAL GAINS ON SALE OF MUTUAL FUND UNITS IS CONTAINED. HE ALSO REFERRED TO PAGE 11 OF PB TO DE MONSTRATE THAT AS ON 31.3.2004, THE UNITS OF DSP MERNIL LYNCH BOND FUND GROWTH WERE AT RS.40,000,000 AND UNITS OF BIRLA INCOME PLUS OF BIRLA MUTUAL FUND (NAV) WERE RS.60, 000,000. THESE UNITS AS ON 31.3.2005 WERE NIL AS AGAINST WHICH, THE ASSESSEE H AD INVESTED IN THE FOLLOWING MUTUAL FUNDS:- I) BIRLA FLOATING RATE FUND : 106,646,382 II) DSP MERIL LYNCH FLOATING RATE FUND: 17,705,95 2 III) DSP MERIL LYNCH FLOATING RATE FUND 53,117,8 57 IV) TEMPLETON INDIA TREASURY MGT 18,500,000 ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 6 LD COUNSEL, THEREFORE, SUBMITTED THAT ENTIRE NEW IN VESTMENT WAS PRIMARILY REALLOCATION OF OLD INVESTMENT. 13. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PE RUSED THE RECORD OF THE CASE. ADMITTEDLY, THE INVESTMENTS HAD BEEN MADE IN SHARES . IN THE ASSESSMENT YEAR 2002-03, THE ASSESSING OFFICER HAD MADE THE DISALLOWANCE OF INTEREST INVOKING THE PROVISIONS OF SECTION 14A AS THE ASSESSEE HAD MADE INVESTMENTS IN SHARES, THE DIVIDEND INCOME FROM WHICH WAS EXEMPT. THE TRIBUNAL HAS RESTORED THE MA TTER IN THE SAID ASSESSMENT YEAR TO THE FILE OF THE AO NOT ACCEPTING THE POSITION AS OB TAINING IN ASSESSMENT YEAR 2001-02, WHEREIN, ASSESSEES CLAIM HAD BEEN ALLOWED. IN THE PRESENT ASSESSMENT YEAR, WE FIND THAT THE AO HAS NOT INVOKED SECTION 14A BUT HAS MADE THE DISALLOWANCE ON THE GROUND THAT INTEREST EXPENDITURE RELATING TO SHARE INVESTMENTS WAS CAPITAL IN NATURE. THE HONBLE BOMBAY HIGH COURT IN THE CASE OF TOPSTAR MERCHANTIL E V. ACIT, 225 CTR 351 (BOM) HAS HELD THAT IF THE AO HAS NOT INVOKED THE PROVISI ONS OF SECTION 14A, THE MATTER CANNOT BE RESTORED TO THE FILE OF THE AO IN VIEW OF THE PR OVISION OF SECTION 14A. ACCORDINGLY, THE DECISION FOR THE ASSESSMENT YEAR 2002-03 OF THE TRIBUNAL CANNOT BE RELIED UPON. AS FAR AS THE DISALLOWANCE ON GROUND OF EXPENDITURE BE ING CAPITAL IN NATURE IS CONCERNED, WE FIND THAT THE ENTIRE FRESH INVESTMENT WAS COVERED F ROM SALE OF OLD INVESTMENTS AND SALE OF PROPERTY. THEREFORE, , NO DISALLOWANCE IS CALLED FOR OUT OF INTEREST PAID ON BORROWINGS MEANT FOR BUSINESS PURPOSES ON THE GROUND THAT PART OF THE SAME WERE UTILIZED FOR INVESTMENT IN SHARES BEING CAPITAL IN NATURE. THIS GROUND IS DISMISSED. 14. APROPOS GROUND NO.3, FACTS ARE THAT FROM THE A CCOUNTS OF THE ASSESEE, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD REC EIVED AN AMOUNT OF RS.58,71,842/- ON ACCOUNT OF DEPOSITS ON BOTTLES FROM THE RETAILERS A ND STOCKIST. THE AO NOTICED THAT IN THE A.YS. 1989-90, 1990-91, 1991-92, 2001-02 AND 2002-0 3, THE ISSUE HAD COME UP FOR COSNIDERATION BEFORE THE ASSESSING OFFICERS. HE NO TED THAT AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, ADDITION OF INCREMENTA L DEPOSITS WAS MADE IN THE RESPECTIVE ASSESSMENT YEARS TREATING THE SAME AS INCOME. HE, ACCORDINGLY MADE AN ADDITION OF RS.58,71,842/-. LD CIT (A) NOTICED THAT THIS ISSUE WAS COVERED BY THE DECISIONS OF LD CIT(A) FOR A.Y. 2002-03 & ITAT FOR THE ASSESSMENT Y EARS 1989-90 AND 1991-92 IN ASSESSEES OWN CASE . HE, ACCORDINGLY, DELETED THE DISALLOWANCE. ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 7 15. HAVING HEARD BOTH THE SIDES, WE FIND THAT THIS ISSUE IS COVERED BY THE DECISION OF THE ITAT FOR THE ASSESSMENT YEAR 1984-85, WHEREIN, ON SIMILAR FACTS, IT WAS HELD AS UNDER:- COMING NOW TO THE ASSESSEES APPEAL, THE FIRST GRO UND IS DIRECTED AGAINST THE ORDER OF THE LD CIT (A) THAT NEW INCREMENTAL DE POSIT DURING THE YEAR COLLECTED IN RESPECT OF BOTTLES AND CASES WOULD REP RESENT TAXABLE INCOME OF THE ASSESSEE AND ANY NEGATIVE VALUE OF DEPOSIT ALLO WABLE AS LOSS. DURING THE COURSE OF HEARING BEFORE US, THE LEARNED COUNSE L FOR THE ASSESSEE ARGUED THAT THE DEPOSITS REPRESENTED SECURITY DEPOS ITS COLLECTED BY THE ASSESSEE IN RESPECT OF BOTTLES AND CASES WHICH BORE THE LOGO OF THE ASSESSEES PRODUCTS, FOR EG THUMPS UP, LIMCA, GOLD SPOT ETC, SUPPLIED BY THE ASSESSEE TO ITS CONSTITUENTS TO ENSURE THE RETU RN OF BOTTLES AND CASES. WHILE DOING SO, THE ASSESSEE DID NOT TRADE IN BOTTL ES AND CASES BUT IN SOFT DRINK ONLY. THE SECURITY DEPOSITS COLLECTED BY THE ASSESSEE WERE REFUNDABLE AND WERE BEING REFUNDED TO THE CONSTITUE NTS AS AND WHEN THE BOTTLES AND CASES WERE REFUNDED TO THE ASSESSEE. T HESE BOTTLES AND CASES ALWAYS REMAINED THE PROPERTY OF THE ASSESSEE. IN T HIS MANNER, WHILE BOTTLES AND CASES LYING WITH THE CONSTITUENTS CONTI NUED TO BE THE PROPERTY OF THE ASSESSEE, THE SECURITY DEPOSITS LYING WITH T HE ASSESSEE CONTINUED TO BELONG TO THE CONSTITUENTS. IN SUPPORT OF THIS CON TENTION, THE LEARNED COUNSEL FOR THE ASSESSEE PLACED RELIANCE ON THE JUD GMENTS REPORTED IN 34 TTJ 4 (CHD), 50 TAXMAN 290(CHD), 40 ITD 117 (PUNE) , 188 ITR 216(DEL) AND 105 ITR 177 (SC). ON PERUSAL OF THESE DECISIONS AND JUDGMENTS, WE FIND THAT THE SAME SUPPORT THE CASE O F THE ASSESSEE. WE, THEREFORE, DELETE THE DIRECTIONS OF THE LEARNED CIT (A) THAT INCREMENTAL DEPOSITS COLLECTED BY THE ASSESSEE DURING THE YEAR ON THE BOTTLES AND CASES SHOULD BE TREATED AS TAXABLE INCOME AND LIKEWISE TH E NEGATIVE BALANCE SHOULD BE TREATED AS BUSINESS LOSS. FURTHER, WE FIND THAT THE TRIBUNAL HAS FOLLOWED THE SAID DECISION FOR THE ASSESSMENT YEARS 1989-90 AND 1991-92, 2001-02, 2003-04. RESPECTFU LLY FOLLOWING THE PRECEDENT, WE UPHOLD THE DECISION OF LD CIT (A) AND REJECT THIS GROUND. 16. APROPOS GROUND NO.4, THE ASSESSING OFFICER NOTI CED THAT THE ASSESSEE HAD CLAIMED DEPRECIATION ON TRUCKS @ 40%. THE AO TAKING NOTE O F THE FACT THAT THE ASSESSEE WAS NOT ENGAGED IN COMMERCIAL PLYING OF TRUCKS, ALLOWED DEP RECIATION @ 25% AND MADE THE DISALLOWANCE OF THE BALANCE 15% EXCESS DEPRECIATION CLAIMED BY THE ASSESSEE AMOUNTING TO RS.14,62,450/-. LD CIT (A) ALLOWED THE ASSESSEE S APPEAL FOLLOWING THE DECISION FOR THE ASSESSMENT YEAR 2002-03. 17. HAVING HEARD BOTH THE SIDES, WE FIND THAT THE T RIBUNAL ON SIMILAR FACTS, FOR THE ASSESSMENT YEAR 2002-03, OBSERVED IN PARA 4.3 AS UN DER:- ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 8 GROUND NO.3 IS AGAINST THE CIT (A) ALLOWING THE DE PRECIATION AT 40% ON TRUCKS AS CLAIMED BY THE ASSESSEE INSTEAD OF 20% ALLOWED B Y THE AO. THIS ISSUE HAS BEEN CONSIDERED BY THE BENCH FOR THE ASSESSMENT YEA R 2001-02 AT GROUND NO.2 AND AT PARAGRAPHS 5 & 6 OF THAT ORDER, THE TRIBUNAL FOLLOWED THE DECISION FOR THE ASSESSMENT YEAR 1998-89 IN THE ASSESSEES OWN CASE AS WELL AS THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF MFG INDIA V CIT, 285 ITR 142 (DEL) AND UPHELD THE CONTENTION OF THE ASSESSEE. RESPECTFULL Y FOLLOWING THE SAME, WE DISMISS THIS GROUND OF THE REVENUE. RESPECTFULLY FOLLOWING THE PRECEDENT, WE REJECT THE GROUND TAKEN BY THE REVENUE. 18. IN THE RESULT, APPEAL FILED BY THE REVENUE STAN DS DISMISSED. PRONOUNCED ON 30 TH APRIL, 2010 SD/- (V. DURGA RAO) (JUDICIAL MEMBER) SD/- (S.V. MEHROTRA) (ACCOUNTANT MEMBER) MUMBAI, DATED 30 TH APRIL , 2010 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)-,VIII, MUM BAI. 4. COMMISSIONER OF INCOME TAX-V, MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH I, MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 9 DATE INITIALS 1. DRAFT DICTATED ON 22.4.10 PS 2. DRAFT PLACED BEFORE AUTHOR 23.4.10 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER AM/JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/J M 5. APPROVED DRAFT COMES TO THE SR. PS PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER ITA NO.2623/M/2009 M/S. BISLERI INTERNATIONAL 10