ACIT, Circle - 15(1), Kolkata , Kolkata V. M/s. ABCI Infrastructures Pvt. Ltd., , Kolkata

ITA 269/KOL/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 0142 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 1 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 16-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROBIN CHOWDHURY
• Assessee Lawyers: M D SHAH
• Keywords: Depreciation; Rule of consistency; Additional depreciation; Assessment record
• Section: 143(3); 195; 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B, BENC H KOLKATA BEFORE SHRI A.T.VARKEY, JM &DR. A.L.SAINI, AM ./ITA NO.269/KOL/2018 ( / ASSESSMENT YEAR:2010-11) ACIT, CIRCLE-15(1), KOLKATA VS. M/S ABCI INFRASTRUCTURES PVT. LTD. 6 TH FLOOR, VASUNDHARA, SARAT BOSE ROAD, BHAWANIPORE, KOLKATA-700020 ./ ./PAN/GIR NO.: AACCM 3317 R (ASSESSEE) .. (REVENUE) ASSESSEE BY :SHRI ROBIN CHOWDHURY, ADDL. CIT SR. D R RESPONDENT BY : SHRI M.D.SHAH, AR / DATE OF HEARING : 31/01/2019 /DATE OF PRONOUNCEMENT : 29/03/2019 / O R D E R PER DR. A. L. SAINI: THE CAPTIONED APPEAL FILED BY THE REVENUE PERTAINI NG TO ASSESSMENT YEAR 2010-11, IS DIRECTED AGAINST AN ORDER PASSED BY T HE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-5, KOLKATA (IN SHORT THE LD. C IT(A)], WHICH IN TURN ARISES OUT OF AN ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 147 / 143(3) OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT) DATED 27 .12.2016. 2. IN THIS APPEAL, HOWEVER, THE REVENUE HAS RAISED MULTIPLE GROUNDS OF APPEAL, BUT AT THE TIME OF HEARING THE MAIN GRIEVANCE OF THE RE VENUE HAS BEEN CONFINED TO THE FOLLOWING ISSUES: M/S ABCI INFRASTRUCTURES PVT. LTD. ITA NO.269/KOL/2018 ASSESSMENT YEAR:2010-11 P PP PA AA AG GG GE EE E | || | 2 22 2 I) GROUND NO. 1:THE LD. CIT(A) ERRED IN DELETING TH E DISALLOWANCE OF DEPRECIATION OF RS. 85,17,966/-(BEING THE DIFFERENCE OF DEPRECIA TION CLAIMED BY ASSESSEE @30% AND ALLOWANCE OF DEPRECIATION BY THE ASSESSING OFFI CER @ 15% ON THE VEHICLES). II) GROUND NO. 2 RELATES TO DELETION OF ADDITION OF RS. 36,00,000/- BEING THE REDUCTION FROM THE SECURED LOAN AND DELETION OF HI RE PURCHASE SUSPENSE ACCOUNT FROM OTHER CURRENT ASSETS ON THE BASIS OF A GENE RAL COMMENT OF THE AUDITOR WITHOUT REBUTTING THE OBSERVATION OF THE ASSESSING OFFICER THAT THE LIABILITY HAS BEEN MET UP BY THE ASSESSEE FROM SOME UNDISCLOSED I NCOME. 3. NOW WE SHALL TAKE ISSUE NO. 1 RAISED BY THE REVE NUE WHICH RELATES TO DISALLOWANCE OF DEPRECIATION OF RS. 85,17,966/-. 5. THE BRIEF FACTS QUA THE ISSUE ARE THAT THEDURING THE ASSESSMENT PROCEEDINGS, AO HAD DISALLOWED RS.85,17,966/- ON ACCOUNT OF ADDITIO NAL DEPRECIATION CLAIMED BY THE ASSESSEE. THE AO IN HIS ASSESSMENT ORDER HAD ST ATED THAT THE ASSESSEE BEING A CIVIL CONTRACTOR, HAD TO DEPLOY VARIOUS KINDS OF PL ANT AND MACHINERY WHICH INCLUDES SEVERAL MACHINES LIKE JCB, EXCAVATOR ETC. AND GOODS TRANSPORT VEHICLES LIKE TIPPERS FOR CARRYING RAW MATERIALS ETC. TO DIF FERENT SITES ACROSS THE COUNTRY. ASSESSEE ALSO MAINTAINED VARIOUS KINDS OF MOTOR VEH ICLES TO CARRY WORKERS TO THE SITES AND FOR THE USE OF THE OFFICIALS/DIRECTORS. I N ITS RETURN OF INCOME, THE ASESSEE IS FOUND TO HAVE SHOWN 30% ON THE WDV OF VEHICLES USED FOR ITS OWN BUSINESS IN THE RELEVANT YEARUNDER CONSIDERATION AND THEREBY CLAIME D DEPRECIATION OF RS.L,70,28,233/- @ 30%. THE ALLOWABLE DEPRECIATION RATE AS PER ASSESSING OFFICER WAS @ 15%. IT IS WORTHWHILE TO MENTION THAT ON VERI FICATION OF 'SCHEDULE DPM' (DEPRECIATION ON PLANT AND MACHINERY) OF THE RETURN FILED BY THE ASSESSEE, WHEREIN IT IS FOUND THAT IN COLUMN OF 30% BLOCK OF PLANT AN D MACHINERY THAT WDV AS ON 01.04.2009 IS DECLARED TO BE RS. 3,25,93,616/- WITH ADDITIONS FOR A PERIOD OF 180 DAYS OR MORE TO THE TUNE OF RS.32,78,346/- AND DELE TION OF RS.2,50,000/-. APART FROM THIS, AN AMOUNT OF RS.4,22,77,628/- IS DECLARE D AS ADDITIONS TO THE BLOCK FOR A PERIOD LESS THAN 180 DAYS. IN SERIAL NO. 12 AND 13 OF THAT SCHEDULE, ASSESSEE CLEARLY DECLARED 'ADDITIONAL DEPRECIATION, IF ANY AS NIL. M/S ABCI INFRASTRUCTURES PVT. LTD. ITA NO.269/KOL/2018 ASSESSMENT YEAR:2010-11 P PP PA AA AG GG GE EE E | || | 3 33 3 THEREFORE, AO WAS OF THE VIEW THAT THAT THE ASSESSE E WILLFULLY MISLED THE DEPARTMENT BY OVER-CLAIMING DEPRECIATION FOR THE PL ANT AND MACHINERY FOR WHICH IT IS ELIGIBLE TO CLAIM AT THE RATE OF 15%,DEPRECIATIO N ONLY. IN AN EXCEPTIONAL NATURE OF USAGE, IT SHOULD MENTION THE CLAIM ON THE RETURN IT SELF BY SHOWING THE AMOUNT OF ADDITIONAL DEPRECIATION. THE AO NOTED THAT IN COURS E OF THE ASSESSMENT PROCEEDINGS, THE ASSESSEE CAME UP WITH NEW CLAIM OF PARTIAL USAGE TO SHOW A PART OF ITS MOTOR VEHICLES FOR HIRING PURPOSE TO JUSTIFY ITS CLAIM OF EXCESS DEPRECIATION. 6. IN RESPONSE, THE ASSESSEE SUBMITTED THE WRITTEN REPLY TO THE ASSESSING OFFICER AS FOLLOWS: .. THE ASSESSEE COMPANY IS CARRYING ON BUSINESS OF CIVIL CONSTRUCTION AND MANUFACTURING OF CONSTRUCTION MATERIAL. IT IS DOING CIVIL CONSTRUCTION IN VARIOUS PLACES IN INDIA PARTICULARLY IN NORTH EASTERN REGIO N. THE COMPANY HAS PURCHASED VARIOUS LIGHT AND HEAVY VEHICLES FOR ITS CIVIL CON STRUCTION WORK AND OTHER OFFICIAL WORK SUCH AS TRUCKS, TIPPERS, TRACTOR, CAR MOTOR CY CLE ETC. THE ASSESSEE COMPANY HAS CLAIMED DEPRECIATION ON SUCH VEHICLES AT 30%. A LL THE HEAVY VEHICLES ARE NOT USED BY THE ASSESSEE COMPANY FOR SUBSTANTIAL PART O F THE YEAR AND THEREFORE, IT GIVES SUCH VEHICLES ON HIRE TO OTHER CONTRACTORS CA RRYING CONSTRUCTION WORK IN NEARBY PLACES TO EARN MORE INCOME. SOME OF THE HEAV Y VEHICLES INCLUDING TIPPERS ARE EXCLUSIVELY GIVEN ON HIRE. HOWEVER, THE ASSESSING OFFICER REJECTED THE CONTENT ION OF THE ASSESSEE AND MADE THE ADDITION TO THE TUNE OF RS. 85,17,966/- BEING T HE DIFFERENCE BETWEEN 30% AND 15% OF DEPRECIATION RATES. 7. AGGRIEVED BY THE STAND SO TAKEN BY THE ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS DELETED THE ADDITION. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE US. 8. BEFORE US, THE LD. DR HAS PRIMARILY REITERATED T HE STAND TAKEN BY THE ASSESSING OFFICER WHICH WE HAVE ALREADY NOTED IN OUR EARLIER PARA AND THE SAME IS NOT BEING REPEATED FOR THE SAKE OF BREVITY. ON THE OTHER HAND , THE LD. COUNSEL FOR THE ASSESSEE DEFENDED THE ORDER PASSED BY THE LD. CIT(A). M/S ABCI INFRASTRUCTURES PVT. LTD. ITA NO.269/KOL/2018 ASSESSMENT YEAR:2010-11 P PP PA AA AG GG GE EE E | || | 4 44 4 9. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. WE NOTE THAT ONLY THE POINT OF DISPUTE IS THAT WHET HER THE ASSESSEE IS ENTITLED TO DEPRECIATION AT HIGHER RATE OF 30% FOR TIPPERS AGA INST THE NORMAL RATE OF DEPRECIATION @ 15%. IT IS NOT DISPUTED, THAT TIPPER S ARE VEHICLES AND ARE REGISTERED UNDER THE MOTOR VEHICLE ACT,1988. THE ASSESSING OFF ICER HAD DISALLOWED DEPRECIATION CLAIMED @ 30% AND RESTRICTED DEPRECIA TION TO 15% AND DISALLOWED RS. 85,17,966/- AS EXCESS DEPRECIATION. THE MAIN RE ASON GIVEN BY THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER U/S 143(3) OF THE A CT, WAS THAT THE EXPLANATION GIVEN BY THE ASSESSEE THAT HIS VEHICLES WERE DEPLOY ED IN DIFFICULT AREAS PARTICULARLY IN THE NORTH EASTERN REGION AND THERE FORE, ENTITLED HIGHER DEPRECIATION, IS AN AFTERTHOUGHT, WHICH IS OFFERED ONLY AFTER THE DISCOVERY OF EXCESS DEPRECIATION BY THE DEPARTMENT. SECONDLY, THE CLAIM OF THE ASSESSEE THAT SOME VEHICLES WERE GIVEN ON HIRE CANNOT BE ACCEPTED, AS NO SPECIFIC INCOME HAS BEEN DECLARED FROM HIRING PURCHASES. 10. WE NOTE THAT THE ASSESSEE AS PER ASSESSMENT REC ORDS HAVE BEEN CLAIMING DEPRECIATION @ 30% ON VEHICLES USED IN THEIR BUSI NESS ON THE GROUNDS OF THEM BEEN DEPLOYED IN DIFFICULT AREAS INCLUDING NORTH EAST. THE ASSESSEE HAD MADE THE SAME CLAIM IN ASSESSMENT YEAR 2009-10, WHICH WAS DI SALLOWED BY THE A.O. THE CIT(A)-16, KOLKATA HAD DELETED THE ADDITION AND ALL OWED DEPRECIATION AT HIGHER RATE IN A.Y.2009-10. THUS, CLEARLY SHOWS THAT THE A SSESSEE IN PAST ASSESSMENT ORDERS, HAVE ALSO BEEN CLAIMED DEPRECIATION AT HIGH ER RATE. THE CONTENTION OF THE A.O., THAT EXPLANATION GIVEN IS AN AFTERTHOUGHT, WH ICH IS OFFERED ONLY AFTER DISCOVERY OF EXCESS DEPRECIATION BY THE DEPARTMENT, IS NOT CORRECT, AND NOT SUPPORTED BY THE FACTS. REGARDING HIRE CHARGES, THE COUNSEL FOR THE ASSESSEE HAS SUBMITTED BEFORE US THAT THE ASSESSING OFFICER HAD NOT ASKED FOR DETAILS OF HIRE CHARGES RECEIVED AGAINST THE TIPPERS GIVEN ON HIRE. SUCH DETAILS COULD HAVE BEEN PROVIDED IF ASKED FOR. THE COUNSEL OF THE ASSESSEE ALSO SUBMITTED THAT THE VEHICLES WERE GIVEN ON HIRING TO PERSON AGAINST WHOM THE AS SESSEE RECEIVED SERVICES IN THE FORM OF GOODS, LABOUR SUPPLY ETC. THE HIRING CHARGE S RECEIVABLE ARE ADJUSTED AGAINST PAYMENTS TO BE MADE TO THESE PERSONS. THES E FACTS HAVE BEEN SUBMITTED TO M/S ABCI INFRASTRUCTURES PVT. LTD. ITA NO.269/KOL/2018 ASSESSMENT YEAR:2010-11 P PP PA AA AG GG GE EE E | || | 5 55 5 THE A.O. THIS METHOD OF ACCOUNTING HAS BEEN FOLLOWE D BY THE ASSESSING OFFICER IN PREVIOUS YEAR AND NO DOUBT WERE RAISED BY THE A.O. EVEN IN SCRUTINY ASSESSMENTS. THEREFORE, A METHOD FOLLOWED BY THE ASSESSING OFFIC ER IN PREVIOUS YEAR SHOULD NOT BE CHANGED UNLESS THERE IS A CHANGE IN FACTS AND LA W. WE NOTE THAT IT IS A WELL SETTLED LEGAL POSITION THAT FACTUAL MATTERS WHICH P ERMEATE THROUGH MORE THAN ONE ASSESSMENT YEAR, IF THE REVENUE HAS ACCEPTED A PART ICULAR'S VIEW OR PROPOSITION IN THE PAST, IT IS NOT OPEN FOR THE REVENUE TO TAKE A ENTIRELY CONTRARY OR DIFFERENT STAND IN A LATER YEAR ON THE SAME ISSUE, INVOLVING IDENTI CAL FACTS UNLESS AND UNTIL A COGENT CASE IS MADE OUT BY THE ASSESSING OFFICER ON THE BA SIS OF CHANGE IN FACTS. FOR THAT WE RELY ON THE ORDER OF THE HONBLE SUPREME COURT I N RADHASOAMISATSANG VS. CIT 193 ITR 321 (SC), WHEREIN IT WAS HELD AS FOLLOWS: 'WE ARE AWARE OF THE FACT THAT, STRICTLY SPEAKING, RES JUDICATA DOES NOT APPLY TO INCOME TAX PROCEEDINGS. AGAIN, EACH ASSESSMENT YEAR BEING A UNIT, WHAT IS DECIDED IN ONE YEAR MAY NOT APPLY IN THE FOLLOWING YEAR BUT WHERE A FUNDAMENTAL ASPECT PERMEATING THROUGH THE DIFFERENT ASSESSMENT YEARS HAS BEEN FOUND AS A FACT ONE WAY OR THE OTHER AND PARTIES HAVE ALLOWED THAT POSITION TO BE SUSTAINED BY NOT CHALLENGING THE ORDER, IT WOULD NOT BE AT ALL APPRO PRIATE TO ALLOW THE POSITION TO BE CHANGED IN A SUBSEQUENT YEAR. ON THESE REASONING , IN THE ABSENCE OF ANY MATERIAL CHANGE JUSTIFYING THE REVENUE TO TAKE A DI FFERENT VIEW OF THE MATTER - AND, IF THERE WAS NO CHANGE, IT WAS IN SUPPORT OF THE AS SESSEE WE DO NOT THINK THE QUESTION SHOULD HAVE BEEN REOPENED AND CONTRARY TO WHAT HAD BEEN DECIDED BY THE COMMISSIONER OF LNCOME-TAX IN THE EARLIER PROCE EDINGS, A DIFFERENT AND CONTRADICTORY STAND SHOULD HAVE BEEN TAKEN.' WE ARE OF THE VIEW THAT THE ABOVE CITED PRECEDENTS ON PRINCIPLE OF CONSISTENCY ARE SQUARELY APPLICABLE TO THE ASSESSEE UNDER CONSIDERA TION. 11. WE NOTE THAT THE A.O. COULD NOT BRING ANY MATER IAL ON RECORD, TO DISPUTE THE ASSESSEES CLAIM, THAT THE VEHICLES AND OTHER EQUIP MENTS WERE DEPLOYED IN DIFFICULT AREAS AND THEREFORE, ENTITLE TO HIGHER RATE OF DEPR ECIATION. THE A.OS CONTENTION, THAT THE EXPLANATION GIVEN BY THE ASSESSEE, IS AN A FTERTHOUGHT, AND THAT NO HIRING CHARGES HAVE BEEN RECEIVED, IS NOT SUPPORTED BY FAC TS. THE TIPPERS USED BY THE ASSESSEE IN ITS BUSINESS ARE REGISTERED UNDER THE M OTOR VEHICLES ACT, 1988. THEY MET THE FUNCTIONAL TEST AS THE BASIS FOR GRANT OF 3 0% DEPRECIATION, AND ALSO ON THE GROUND THAT THE HIGHER DEPRECIATION IS ON ACCOUNT OF RIGOROUS AND HARD USE OF COMMERCIAL VEHICLES, IN COMPARISON TO THE STATIONER Y AND PERMANENTLY INSTALLED M/S ABCI INFRASTRUCTURES PVT. LTD. ITA NO.269/KOL/2018 ASSESSMENT YEAR:2010-11 P PP PA AA AG GG GE EE E | || | 6 66 6 MACHINERY. THESE VIEWS, FIND SUPPORT IN THE DECISIO N OF THE PUNJAB & HARIYANA HIGH COURT IN THE CASE OF CIT VS. RAKESH JAIN [2013 ] 350 ITR 230 (P&J). THEREFORE, TAKING INTO ACCOUNT THE SUBMISSION OF TH E COUNSEL AND RELEVANT ASSESSMENT RECORDS, THE ADDITION OF RS. 85,17,966/- , MADE BY AO, ON ACCOUNT OF ADDITIONAL DEPRECIATION CLAIM ON HIGHER RATE,SHOULD BE DELETED.THAT BEING SO, WE DECLINE TO INTERFERE WITH THE ORDER OF ID. C.I T.(A ) IN DELETING THE AFORESAID ADDITION. HIS ORDER ON THIS ADDITION IS, THEREFORE, UPHELD AND THE GROUNDS OF APPEAL OF THE REVENUE IS DISMISSED. 12. NOW WE SHALL TAKE THE ISSUE WHICH RELATES TO A DDITION OF RS. 36 LACS BEING DEDUCTION FROM THE SECURED LOAN AND DELETION OF HIR E PURCHASE SUSPENSE ACCOUNT. 13. THE BRIEF FACTS QUA THE ISSUE ARE THAT DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE FILED ITS AUDITED BALANCE SHEET AS ON 31.0 3.2011 BEFORE THE AO, FOR THE ASSESSMENT PROCEEDINGS OF A.Y. 2011-12. IN BALANCE SHEET, A CHANGE HAD BEEN MADE IN ASSET WITH BALANCING ENTRY IN LIABILITY SID E. IN HIRE PURCHASE INTEREST SUSPENSE ACCOUNT UNDER 'OTHER CURRENT ASSETS' THE B ALANCE OF RS.36,00,000/-WAS FOUND TO HAVE VACATED TO NIL. ON THE OPPOSITE SIDE, THE SAME AMOUNT HAS BEEN REDUCED FROM' SECURED LOAN'. THE AO NOTICED THAT TH IS CHANGE WAS DONE WITHOUT ANY CLARIFICATION OR NOTE. EVEN NO CHANGE HAS BEEN MADE IN THE AUDITED ACCOUNTSSUPPLIED WITH THE COMPLIANCE OF ASSESSMENT PROCEEDINGS OF A.Y. 2010-11. IN COURSE OF THE ASSESSMENT PROCEEDINGS, ASSESSEE W AS ASKED TO EXPLAIN THE ISSUE AND SHOW CAUSE AS TO WHY THE OMISSION IN ASSET AND LIABILITIES WILL NOT BE ADDED TO THE TOTAL INCOME. IN RESPONSE, THE ASSESSEE SUBMITTED A WRITTEN SUBMI SSION, VIDE LETTER DATED 16.12.2016, WHICH IS REPRODUCED BELOW: 'WITH REFERENCE TO YOUR ABOVE SUBJECTED PROCEEDINGS AND IN RESPONSE TO YOUR SHOW CAUSE NOTICE DATED 09.12.2016, WE WOULD LIKE T O SUBMIT BEFORE YOUR HONOUR THAT RS.36,00,000/- SHOWN IN THE BALANCE SHEET AS O N 31.03.2010 UNDER 'OTHER CURRENT ASSETS' AGAINST 'HIRE PURCHASE INTEREST SUS PENSE' REPRESENTS THE AMOUNT OF INTEREST ON TERM LOAN ACCRUED BUT NOT DUE AS ON THE DATE OF THE BALANCE SHEET. IN OTHER WORDS, THIS IS THE AMOUNT OF UN-MATURED INTER EST WHICH SHALL BE PAYABLE IN FUTURE YEARS OVER THE TENURE OF THE TERM LOAN. ON T HE OTHER HAND, THE SAME AMOUNT IS INCLUDED IN OUTSTANDING AMOUNT OF TERM LOAN IN L IABILITIES SIDE OF THE BALANCE SHEET. M/S ABCI INFRASTRUCTURES PVT. LTD. ITA NO.269/KOL/2018 ASSESSMENT YEAR:2010-11 P PP PA AA AG GG GE EE E | || | 7 77 7 FURTHER, IN THE BALANCE SHEET AS ON 31.03.2011, HI RE PURCHASE INTEREST SUSPENSE AMOUNT HAS BEEN DEDUCTED FROM THE AMOUNT OF TERM LO AN FOR DISCLOSURE COMPLIANCE OF SCHEDULE VI OF THE COMPANIES ACT, 195 6. ACCORDINGLY, THE CORRESPONDING AMOUNT OF THE PREVIOUS YEAR IN THE BA LANCE SHEET AS ON 31.03.2011 HAS BEEN RE-GROUPED TO MAKE IT COMPARABLE WITH THE FIGURES OF THE CURRENT YEAR. WE THEREFORE, REQUEST YOUR HONOUR NOT TO ADD THIS A MOUNT TO PROFIT SINCE THE SAME IS THE AMOUNT OF UN-MATURED INTEREST, WHICH IS NOT DUE FOR PAYMENT AS ON THE BALANCE SHEET DATE. THE AMOUNT HAS BEEN ADJUSTED WI TH SECURED LOAN FOR THE COMPLIANCE PURPOSE ONLY OTHERWISE THE TERM LOAN WOU LD HAVE BEEN REMAINED OVERSTATED BY THE AMOUNT OF UN-MATURED INTEREST WIT H CORRESPONDING AMOUNT APPEARING IN THE ASSETS SIDE OF THE BALANCE SHEET. HOWEVER, THE ASSESSING OFFICER REJECTED THE CONTENT ION OF THE ASSESSEE AND HELD THAT THE EXPLANATION OFFERED BY THE ASSESSEE IS NOT ACCE PTABLE IN VIEW OF THE FACT THAT IT WAS NEITHER BROUGHT INTO THE NOTICE OF THE DEPARTME NT BEFORE DISCOVERY OF THE MATTER BY THE DEPARTMENT NOR SUPPORTED BY AUDIT REP ORT. THEREFORE, AO MADE ADDITION OF RS.36,00,000/-. 14. AGGRIEVED BY THE STAND SO TAKEN BY THE ASSESSIN G OFFICER THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS DELETED THE ADDITION. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE US. 15. BEFORE US, THE LD. DR HAS PRIMARILY REITERATED THE STANDS TAKEN BY THE ASSESSING OFFICER WHICH WE HAVE ALREADY NOTED IN OUR EARLIER PARA AND THE SAME IS NOT BEING REPEATED FOR THE SAKE OF BREVITY. ON THE OTHER HAND , THE LD. COUNSEL HAS DEFENDED THE ORDER OF THE LD. CIT(A). 16. WE HAVE HEARD THE RIVAL SUBMISSION AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE NOTE THAT THE A.O. HAS ADDED BACK HIRE P URCHASE INTEREST SUSPENSE AMOUNTING TO RS. 36,00,000/-. THE A.O. HAD NOT ACCE PTED THE EXPLANATION OF THE ASSESSEE, THAT THIS AMOUNT REPRESENTS UN-MATURE INT EREST, WHICH HAVE BEEN PAYABLE IN FUTURE YEARS OVER THE TENURE OF THE TERM LOAN ON THE GROUNDS THAT IT WAS NOT BROUGHT TO THE NOTICE OF THE A.O. BEFORE DISCOVERY OF THE MATTER BY THE DEPARTMENT AND NOT SUPPORTED BY AUDIT REPORT. THELD COUNSEL FO R THEASSESSEE, SUBMITTED BEFORE US THAT IN THE BALANCE SHEET AS ON 31.03.201 1, HIRE PURCHASE INTEREST SUSPENSE AMOUNT HAS BEEN DEDUCTED FROM THE AMOUNT O F TERM LOAN FOR DISCLOSURE COMPLIANCE OF SCHEDULE VI OF THE COMPANIES ACT,1956 . ACCORDINGLY, THE M/S ABCI INFRASTRUCTURES PVT. LTD. ITA NO.269/KOL/2018 ASSESSMENT YEAR:2010-11 P PP PA AA AG GG GE EE E | || | 8 88 8 CORRESPONDING AMOUNT OF THE PREVIOUS YEAR IN THE BA LANCE SHEET AS ON 31.03.2011 HAS BEEN RE-GROUPED, TO MAKE IT COMPARABLE WITH THE FIGURES OF THE CURRENT YEAR. WE NOTE THAT ON VERIFICATION OF THE AUDIT REPORT, S CHEDULE 18 CLEARLY STATES THE FOLLOWINGS: PREVIOUS YEAR'S FIGURES HAVE BEEN RE-GROUPED, REWO RKED, RE-ARRANGED, RE- CLASSIFIED WHEREVER NECESSARY TO CONFORM TO CURRENT YEAR CLASSIFICATION'. WE NOTE THAT THE SUBMISSION OF THE LD COUNSEL THAT IN THE BALANCE SHEET AS ON 31.03.2011, HIRE PURCHASE INTEREST SUSPENSE ACCOUNT HAS BEEN DEDUCTED FROM AMOUNT OF TERM LOAN FOR DISCLOSURE COMPLIANCE OF SC HEDULE V1 OF THE COMPANIES ACT, 1956 AND THE SAME IS SUPPORTED BY THE AUDIT RE PORT AND CERTIFICATION OF THE AUDITOR. THEREFORE, WE ARE OF THE VIEW THAT THE SA ID AMOUNT OF RS.36.00,000/- DOES NOT REPRESENT INCOME. IT IS JUST RE-GROUPED, R EWORKED, RE-ARRANGED, RE- CLASSIFICATION OF THE FIGURES IN THE BALANCE SHEET OF THE ASSESSEE FOR THE PURPOSE OF PRESENTATION IN THE BALANCE SHEET AND NO ANY UNACCO UNTED MONEY WAS INTRODUCED BY THE ASSESSEE COMPANY. HENCE, AFTER A CAREFUL CON SIDERATION OF THE SUBMISSION OF THE LD COUNSEL AND RELEVANT ASSESSMENT RECORDS, THE ADDITION OF RS. 36,00,000-, MADE BY AO ON ACCOUNT OF HIRE PURCHASE INTEREST SUS PENSE ACCOUNT IS NOT JUSTIFIED. THE ASSET SIDE OF THE BALANCE SHEET AND LIABILITY S IDE OF THE BALANCE SHEET BOTH ARE DIAGNOSED AND WE NOTE THAT THIS IS JUST AN ACCOUNT ING ENTRY AND PRESENTATION IN THE BALANCE SHEET THEREFORE,ADDITION MADE BY THE ASSESS ING OFFICER NEEDS TO BE DELETED. THAT BEING SO, WE DECLINE TO INTERFERE IN THE ORDER OF THE LD. CIT(A), ON THIS ISSUE, HIS ORDER IS HEREBY UPHELD AND GROUND S OF APPEAL RAISED BY THE REVENUE IS DISMISSED. 17. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED IN THE COURT ON 29.03.2019 SD/- ( A.T.VARKEY ) SD/- (A.L.SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /KOLKATA; / DATE: 29/03/2019 ( SB, SR.PS ) M/S ABCI INFRASTRUCTURES PVT. LTD. ITA NO.269/KOL/2018 ASSESSMENT YEAR:2010-11 P PP PA AA AG GG GE EE E | || | 9 99 9 COPY OF THE ORDER FORWARDED TO: 1. ACIT, CIRCLE-15(1), KOLKATA 2. M/S ABCI INFRASTRUCTURES PVT. LTD. 3. C.I.T(A)- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. 6. GUARD FILE. TRUE COPY BY ORDER ASSIST ANT REGISTRAR ITAT, KOLKA TA BENCHES