DCIT, New Delhi V. M/s Yamaha Motor India Pvt. Ltd., New Delhi

ITA 2652/DEL/2010

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 7105 (ITAT-DELHI)
• Duration Of Justice: 40 year(s) 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2010
• Appeal Filed By: Department
• Assessment Year: misc
• Appeal Filed On: 01-01-1970
• Court: TRIBUNAL
• Department Lawyers: ANUSHA KHURANA
• Assessee Lawyers: V MOHAN
• Keywords: Depreciation
• Section: 32

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH I NEW DELHI) BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA. NO.2652/D/2010 ASSESSMENT YEAR : 2003-04 D.C.I.T., VS. M/S YAMAHA MOTOR INDIA CIRCLE 18(1), PVT. LTD., ALLIAZ HOUSE, 2ND NEW DELHI. FLOOR, 273, CAPT. GAUR MARG PAN NO.AAACE 1647C (APPELLANT) (RESPONDENT) APPELLANT BY : MS. ANUSHA KHURANA, DR RESPONDENT BY : SHRI V. MOHAN, FCA ORDER PER R.C. SHARMA: AM: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A)-XX, NEW DELHI DATED 30.03.2010 IN APPEAL NO.111/2006-07 FOR ASSESSMENT YEAR 2003-04, WHEREI N THE FOLLOWING GROUNDS HAVE BEEN TAKEN BY THE REVENUE:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LEARNED CIT(A) HAS ERRED IN DISALLOWING DEPRECIATION AMOUNTING TO `1,77,24,750/- IN RESPECT OF ASSETS DISCARDED & WRITTEN OFF BY THE ASSESSEE DURING THE FINANCIAL YEAR 1999-2000, 2000-01 & 2001-02 AS THE DISCARDED AND WRITTEN OFF ASSETS ARE NOT IN USE AND, THEREFORE, NOT SATISFYING THE CONDITIONS OF SECTION 32 OF THE INCOME-TAX ACT, 1961. 2 2. AT THE OUT SET LEARNED AR PLACED ON RECORD THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR AS SESSMENT YEARS 1999-2000, 2000-01 & 2001-02, WHEREIN EXACTLY SIMILAR ISSUE WAS DECIDED BY THE TRIBUNAL AND MATTE R WITH REGARD TO COMPUTATION OF DEPRECIATION IN RESPECT OF SALE/RETURN OF ASSETS FORMING PART OF THE BLOCK OF ASSETS, WAS RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER FOR RE- COMPUTATION. IT WAS OBSERVED BY THE TRIBUNAL THAT ON SALE OR WRITTEN OFF OF SOME OF THE ASSETS, THEIR WDV IS TO BE REDUCED FROM THE WDV OF BLOCK ASSETS FOR THE PURPOSES OF CO MPUTING DEPRECIATION AND NOT THE WDV OF ASSETS BY WORKING O UT THE SAME ITEM-WISE. THE LEARNED AR FAIRLY CONCEDED THA T THE FACTS AND CIRCUMSTANCES DURING THE YEAR UNDER CONSI DERATION ARE IN PARI MATERIA WITH THE ASSESSMENT YEARS 2000- 01 AND 2001-02 AS DECIDED BY THE TRIBUNAL, WE FOUND THAT H ONBLE DELHI HIGH COURT IN AN APPEAL FILED BY THE REVENUE AGAINST THIS ORDER OF TRIBUNAL, CONFIRMED THE SAME VIDE ITS ORDER DATED 9 TH AUGUST, 2009 AFTER HAVING THE FOLLOWING OBSERVATIONS:- 3 HARMONEOUS READING OF EXPRESSIONS USED FOR THE PURPOSES OF THE BUSINESS AND DISCARDED OCCURRING IN SECTION 32 MEANS USER IN THE BUSINESS IN THE EARLIER YEARS AND NOT IN THE RELEVANT PREVIOUS YEAR; DEPRECIATION IS ALLOWABLE AFTER REDUCING THE SCRAP VALUE OF THE ASSETS WHICH HAVE BEEN DISCARDED AND WRITTEN OFF IN THE BOOKS OF ACCOUNT IN THE RELEVANT YEAR FROM THE WDV OF THE BLOCK OF ASSETS. 2.1 WE HAVE GONE THROUGH THE ORDER OF THE TRIBUNA L WHICH WAS DULY AFFIRMED BY THE HONBLE HIGH COURT W HEREIN EXACTLY SIMILAR ISSUE WITH RESPECT TO COMPUTATION O F DEPRECIATION WAS EXAMINED WITH REFERENCE TO REDUCIN G THE SCRAP VALUE OF ASSETS WHICH HAVE BEEN DISCARDED AND WRITTEN OFF IN THE BOOKS OF ACCOUNTS IN THE RELEVANT ASSESS MENT YEAR FROM THE WDV OF BLOCK ASSETS. THE DECISION OF THE TRIBUNAL WAS AFFIRMED BY THE HONBLE HIGH COURT FOR BOTH THE ASSESSMENT YEARS VIDE ITS ORDER DATED 9 TH AUGUST, 2009 AND REPORTED AT 226 CTR 304. AS THE FACTS AND CIRCUMST ANCES DURING THE YEAR UNDER CONSIDERATION ARE IN PARI MAT ERIA, RESPECTIVELY FOLLOWING THE ORDER OF THE HONBLE HIG H COURT, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LE ARNED CIT(A) WHICH HAS ALSO RESTORED THE MATTER BACK TO THE FILE OF THE 4 ASSESSING OFFICER FOR RE-COMPUTING DEPRECIATION AFT ER REDUCING THE SCRAP VALUE OF ASSETS WHICH HAVE BEEN DISCARDED AND WRITTEN OFF IN THE BOOKS OF ACCOUNTS FOR THE YEAR UNDER CONSIDERATION FROM THE RETURN DOWN VALUE OF THE BLOCK OF ASSETS. 3. IN RESULT, APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN OPEN COURT ON 24.09.2010. SD/- SD/- ( RAJPAL YADAV ) ( R.C. SHARMA ) JUDICIAL MEMBER ACCOUNTANT ME MBER DT.24.09.2010. NS *COPY FORWARDED TO:- 1. DCIT, CIRCLE 18(1), NEW DELHI. 2. M/S YAMAHA MOTOR INDIA PVT. LTD., ALLIAZ HOUSE, 2 ND FLOOR, 273, CAPT. GAUR MARG, SRINIWAS PURI, NEW DELHI. 3. THE CIT 4. THE CIT (A), NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DELHI. TRUE COPY BY ORDER (ITAT, NEW DELHI).