PERBON YARMANE (INDIA) LTD, MUMBAI V. ACIT 4(2), MUMBAI

ITA 2651/MUM/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7912 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2004-2005
• Appeal Filed On: 06-04-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: O P SHAMA
• Assessee Lawyers: APURV GANDHI
• Keywords: Depreciation; Opportunity of being heard; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH C,MUMBAI BEFORE SHRI N.V. VASUDEVAN (JM) & SHRI RAJENDRA SIN GH (AM) I.T.A.NO.2651/MUM/2010 (A.Y. 2004-05)) M/S. PREBON YAMANE (INDIA) LTD., 4 TH FLOOR, MANECKJI WADIA BLDG., M.G. ROAD, FORT, MUMBAI-400 023. PAN: AAACE 3505 D VS. ASST.COMMR. OF INCOME-TAX-4(2), AAYKAR BHAVAN, M.K. ROAD, MUMBAI-400 020. APPELLANT RESPONDENT APPELLANT BY SHRI APURV GANDHI. RESPONDENT BY SHRI O. P. SHAMA. O R D E R PER RAJENDRA SINGH, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 13-01- 2010 OF CIT(A)-8, MUMBAI, FOR THE ASSTT. YEAR 2004- 05. THE ASSESSEE IN THIS APPEAL HAS RAISED DISPUTE ON TWO GROUNDS. 2. THE FIRST DISPUTE IS REGARDING ADDITION OF RS.11 ,51,367/- ON ACCOUNT OF DEPRECIATION ON NSE AND FEDAI MEMBERSHIP CARD. THE ASSESSEE HAD CLAIMED DEPRECIATION ON NSE CARD AND FOREIGN EXCHANGE DEALE R ASSOCIATION OF INDIA (FEDAI) MEMBERSHIP FEE TREATING THE SAME AS INTANGI BLE ASSETS UNDER THE PROVISIONS OF SEC. 32(1)(II) WHICH ALLOWS DEPRECIAT ION ON INTANGIBLE ASSETS SUCH AS KNOWHOW, PATENTS, COPYRIGHTS, LICENCES, FRANCHISEES OR ANY OTHER BUSINESS OR COMMERCIAL RIGHT OF SIMILAR NATURE. THE AO, HOWEVER , DID NOT ALLOW DEPRECIATION ON THE GROUND THAT THE ASSETS WERE NOT DEPRECIABLE AND THE ASSESSEE WAS NOT OWNER OF THE ASSETS. IN APPEAL, THE CIT(A), FOLLOWI NG THE JUDGMENT OF THE HONBLE ITA 2651/M/10 PREBON YAMANE (I) LTD. 2 BOMBAY HIGH COURT IN THE CASE OF TECHNO SHARES AND STOCKS LTD. (323 ITR 69), DISALLOWED THE CLAIM OF DEPRECIATION, AGGRIEVED BY WHICH THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 3. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATE RIAL AND CONSIDERED THE MATTER CAREFULLY. THE HONBLE SUPREME COURT IN THE CASE OF TECHNO SHARES AND STOCKS LTD. (327 ITR 323) HAVE NOT UPHELD THE VIEW TAKEN BY THE HONBLE BOMBAY HIGH COURT AND HAVE HELD THAT NSE/BSE CARD W AS AKIN TO LICENCES THUS INTANGIBLE ASSETS U/S.32(1)(II) OF THE ACT. ACCORDI NGLY, THE HONBLE SUPREME COURT HELD THAT DEPRECIATION WAS ALLOWABLE. WE, THEREFORE , SET ASIDE THE ORDER OF CIT(A) AND ALLOW THE CLAIM OF DEPRECIATION IN THE CASE OF NSE CARD. AS REGARDS FEDAI MEMBERSHIP CARD, WE FIND THAT THE SAME ISSUE HAD BE EN CONSIDERED BY THE TRIBUNAL IN THE ASSESSEES OWN CASE IN ITA NO. 2852 /MUM/2006 FOR THE ASSTT. YEAR 2003-04 IN WHICH THE TRIBUNAL RESTORED THE ISS UE TO THE FILE OF AO TO VERIFY IF FEDAI MEMBERSHIP WAS EQUIVALENT TO NSE CARD. WE, TH EREFORE, RESPECTFULLY FOLLOWING THE DECISION OF THE TRIBUNAL (SUPRA), RES TORE THIS ISSUE TO THE FILE OF AO FOR FRESH DECISION AFTER NECESSARY EXAMINATION AND AFTER ALLOWING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 4. THE SECOND DISPUTE IS REGARDING DISALLOWANCE OF RS.4,00,731/- BEING THE AMOUNT PAID TO SUPERANNUATION FUND. THE AO DISALLOW ED THE CLAIM ON THE GROUND THAT SUPERANNUATION FUND WAS NOT APPROVED. THE DISA LLOWANCE HAS BEEN CONFIRMED BY THE CIT(A), AGGRIEVED BY WHICH THE ASS ESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. WE HAVE HEARD BOTH THE PARTIES IN THE MATTER. WE FIND THAT THE SAME ISSUE HAD BEEN CONSIDERED BY THE TRIBUNAL IN THE ASSESSEE S OWN CASE FOR ASSTT. YEAR 2003-04 VIDE ITA NO. 2852/MUM/2006 IN WHICH THE ASS ESSEE CLAIMED THAT, SUBSEQUENTLY, APPROVAL HAD BEEN RECEIVED FROM CIT. THE TRIBUNAL, THEREFORE, RESTORED THE ISSUE TO THE FILE OF AO FOR RE-CONSIDE RATION OF THE CLAIM IN THE LIGHT OF ITA 2651/M/10 PREBON YAMANE (I) LTD. 3 APPROVAL RECEIVED AND AFTER GIVING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE FACTS IN THIS YEAR ARE IDENTICAL. THEREFORE, RE SPECTFULLY FOLLOWING THE DECISION OF TRIBUNAL (SUPRA), WE RESTORE THIS ISSUE TO THE F ILE OF AO FOR PASSING A FRESH ORDER AFTER NECESSARY EXAMINATION AND AFTER ALLOWIN G OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED IN TERMS OF THE ORDER ABOVE. ORDER PRONOUNCED ON THE 18TH DAY OF MARCH, 2 011. SD/- SD/- (N.V. VASUDEVAN) (RAJENDRA SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI: 18TH MARCH , 2011. NG: COPY TO : 1. ASSESSEE. 2. DEPARTMENT. 3. CIT(A)-8,MUMBAI. 4. CIT-4, MUMBAI. 5. DR,C BENCH,MUMBAI. 6. MASTER FILE. (TRUE COPY) BY ORDER, ASST.REGISTRAR, ITAT, MUMBAI. ITA 2651/M/10 PREBON YAMANE (I) LTD. 4 DETAILS DATE INITIALS DESIGNA TION 1. DRAFT DICTATED ON 11-03-2011 SR.PS/ 2. DRAFT PLACED BEFORE AUTHOR 14-03-201 SR.PS/ 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/ AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/ 6. KEPT FOR PRONOUNCEMENT ON SR.PS/ 7. FILE SENT TO THE BENCH CLERK SR.PS/ 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9. DATE ON WHICH FILE GOES TO THE AR 10. DATE OF DISPATCH OF ORDER