Robotix Learning Solutions P Ltd., CHENNAI V. ITO Corporate Ward 5(3), CHENNAI

ITA 2669/CHNY/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 1050 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 07-11-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B SAGADEVAN
• Assessee Lawyers: S SRIDHAR
• Keywords: Depreciation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO.2669/CHNY/2017 ( )( / ASSESSMENT YEAR : 2014-15 M/S ROBOTIX LEARNING SOLUTIONS PVT. LTD., C/O C/O SHRI S. SRIDHAR, SH. A.S. SRIRAMAN, ADVOCATES, NEW NO.14, OLD NO.82, FLAT NO.5, 1 ST AVENUE, INDIRA NAGAR, ADYAR, CHENNAI - 600 020. PAN : AAFCR 0395 D V. THE INCOME TAX OFFICER, CORPORATE WARD 5(3), CHENNAI. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE -.+, / 0 / RESPONDENT BY : SHRI B. SAGADEVAN, JCIT 1 / 2% / DATE OF HEARING : 10.07.2018 3') / 2% / DATE OF PRONOUNCEMENT : 12.09.2018 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -3, CHENNA I, DATED 29.09.2017 AND PERTAINS TO ASSESSMENT YEAR 2014-15. 2 I.T.A. NO.2669/CHNY/17 2. THE FIRST ISSUE ARISES FOR CONSIDERATION IS DEPR ECIATION CLAIMED BY THE ASSESSEE ON ROBOTIX KITS. 3. SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE , SUBMITTED THAT THE ASSESSEE PURCHASED ROBOTIX KITS TO THE EXT ENT OF 55,70,960/- DURING THE YEAR UNDER CONSIDERATION AND CLAIMED DEPRECIATION @ 60% WHICH IS APPLICABLE FOR COMPUTER S. ACCORDING TO THE LD. COUNSEL, ROBOTIX KITS CAN BE OPERATED ON LY WITH THE COMPUTER, THEREFORE, IT WAS GROUPED UNDER THE HEAD COMPUTER. THE LD.COUNSEL FURTHER SUBMITTED THAT ROBOTIX KITS COMPRISE ASSORTMENT OF PARTS AND AN INSTRUCTION MANUAL THAT PRESENTS NUMEROUS IDEAS FOR CREATING MANY MODELS, ETC. AND T HESE KITS CAN BE OPERATED ONLY WITH COMPUTERS. THEREFORE, ACCORD ING TO THE LD. COUNSEL, THEY ARE GROUPED UNDER THE HEAD COMPUTER A ND ACCESSORIES, HENCE, THE ASSESSEE IS ELIGIBLE FOR DE PRECIATION @ 60%. 4. WE HEARD SHRI B. SAGADEVAN, THE LD. DEPARTMENTAL REPRESENTATIVE ALSO. ADMITTEDLY, THE ASSESSEE PURC HASED ROBOTIX KITS FOR THE PURPOSE OF ITS BUSINESS. SINCE COMPUT ERS ARE OPERATING THE ROBOTIX KITS, THE ASSESSEE CLAIMED DEPRECIATION @ 60% WHICH IS ELIGIBLE FOR COMPUTERS. THE QUESTION ARISES FOR CO NSIDERATION IS 3 I.T.A. NO.2669/CHNY/17 WHETHER ROBOTIX KITS CAN BE CONSIDERED AS COMPUTER MERELY BECAUSE THE SAME ARE OPERATED THROUGH COMPUTER? IT IS COMM ON KNOWLEDGE THAT NOWADAYS THE ENTIRE INDUSTRY IS AUTOMATED AND MACHINERIES ARE OPERATED THROUGH COMPUTER. IT DOES NOT MEAN THAT T HE ENTIRE INDUSTRIAL UNDERTAKING WAS A COMPUTER. THE COMPUTE R OR SOFTWARE INSTALLED THEREIN MAY BE USED FOR OPERATING INDUSTR IAL MACHINERIES. IN THIS CASE ALSO, THE COMPUTER OR SOFTWARE ATTACHE D IS USED FOR OPERATION OF ROBOTIX KITS. THEREFORE, IT CANNOT BE CONSTRUED AS IF THE ROBOTIX KITS ITSELF IS A COMPUTER. THIS TRIBUNAL I S OF THE CONSIDERED OPINION THAT THE COMPUTER IS TOTALLY DIFFERENT WHIC H COMPRISES PROCESSING DATA AND NOT THE MACHINERY WHICH UNDERTA KES WORKS AS PER THE INSTRUCTION GIVEN THROUGH THE COMPUTER. TH EREFORE, COMPUTER IS A DIFFERENT ONE AND ROBOTIX KITS ARE EN TIRELY DIFFERENT MACHINERIES. HENCE, THIS TRIBUNAL IS OF THE CONSID ERED OPINION THAT THE ASSESSEE IS NOT ELIGIBLE FOR DEPRECIATION @ 60% AS CLAIMED. ACCORDINGLY, THIS TRIBUNAL DO NOT FIND ANY REASON T O INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SA ME IS CONFIRMED. 5. THE NEXT ISSUE ARISES FOR CONSIDERATION IS ADDIT ION OF 14,48,466/-. 4 I.T.A. NO.2669/CHNY/17 6. SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE , SUBMITTED THAT THE ASSESSEE CLAIMED DEPRECIATION FOR THREE BL OCK OF ASSETS. FOR THE FIRST BLOCK OF ASSET, THE DEPRECIATION WAS CLAIMED AT 10%, FOR THE SECOND BLOCK, THE DEPRECIATION WAS CLAIMED AT 1 5% AND FOR THE THIRD BLOCK, THE DEPRECIATION WAS CLAIMED AT 60%. ACCORDING TO THE LD. COUNSEL, ALL THE BILLS AND VOUCHERS WERE PRODUC ED IN RESPECT OF FIRST AND SECOND BLOCKS. IN RESPECT OF THIRD BLOCK , ACCORDING TO THE LD. COUNSEL, THE ASSESSING OFFICER FOUND THAT THE A SSESSEE HAS NOT SUBMITTED PROPER BILLS. THEREFORE, HE DISALLOWED 14,48,466/-. ACCORDING TO THE LD. COUNSEL, THE ASSESSEE IS HAVIN G PROPER BILLS AND VOUCHERS. ACCORDING TO THE LD. COUNSEL, THIS G ROUND WAS NOT AGITATED BEFORE THE CIT(APPEALS), THEREFORE, THE CI T(APPEALS) HAD NO OCCASION TO CONSIDER THE SAME. SINCE THE GROUND WAS RAISED FIRST TIME BEFORE THIS TRIBUNAL, ACCORDING TO THE L D. COUNSEL, THE FACTUAL ASPECT HAS TO BE EXAMINED. THEREFORE, THE MATTER MAY BE REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER FOR RECONSIDERATION. 7. ON THE CONTRARY, SHRI B. SAGADEVAN, THE LD. DEPA RTMENTAL REPRESENTATIVE, SUBMITTED THAT THE DISALLOWANCE OF 14,48,466/- WAS NOT CHALLENGED BEFORE THE ASSESSING OFFICER OR BEFORE THE CIT(APPEALS). SINCE THE ADDITION WAS NOT CHALLENGE D BEFORE THE FIRST 5 I.T.A. NO.2669/CHNY/17 APPELLATE AUTHORITY, ACCORDING TO THE LD. D.R., THE ASSESSEE IS NOT JUSTIFIED IN AGITATING THE MATTER BEFORE THIS TRIBU NAL. 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSING OFFICER MADE ADDITION OF 14,48,466/- ON THE GROUND THAT THE ASSESSEE HAS NOT SUBMITTED PROPER BILLS TOWARDS PUR CHASE OF ASSETS. THE LD.COUNSEL FOR THE ASSESSEE NOW CLAIMS THAT BILLS AND VOUCHERS ARE READILY AVAILABLE. THEREFORE, THIS TR IBUNAL IS OF THE CONSIDERED OPINION THAT GIVING ONE MORE OPPORTUNITY TO THE ASSESSEE TO PRODUCE BILLS WOULD NOT PREJUDICE THE I NTERESTS OF THE REVENUE. EVEN THOUGH NO GROUND WAS RAISED BEFORE T HE CIT(APPEALS) IN RESPECT OF THE ADDITION OF 14,48,466/-, THE ASSESSEE HAS RAISED SPECIFIC GROUND BEFORE THIS TRI BUNAL. THIS TRIBUNAL BEING THE FINAL FACT FINDING AUTHORITY, TH E FACTS NEED TO BE SETTLED AT TRIBUNAL LEVEL. THEREFORE, EXAMINING TH E MATTER BY THE ASSESSING OFFICER ON THE BASIS OF BILLS AND VOUCHER S THAT MAY BE PRODUCED BY THE ASSESSEE IS VERY ESSENTIAL. ACCORD INGLY, ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE IS SUE OF ADDITION OF 14,48,466/- IS REMITTED BACK TO THE FILE OF THE ASS ESSING OFFICER. THE ASSESSING OFFICER SHALL RE-EXAMINE THE MATTER I N THE LIGHT OF THE 6 I.T.A. NO.2669/CHNY/17 MATERIAL THAT MAY BE FILED BY THE ASSESSEE AND THER EAFTER DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW, AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 12 TH SEPTEMBER, 2018 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 12 TH SEPTEMBER, 2018. KRI. / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A)-3, CHENNAI 4. 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