The DCIT, Circle-1(1)(2), Ahmedabad V. M/s. Cera Sanitaryware Ltd., Ahmedabad

ITA 2813/AHD/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8009 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 06-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: TUSHAR H VASA
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH (BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER & SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER) ITA. NOS: 2813 & 2814/AHD/2015 (ASSESSMENT YEARS: 2009-10 & 2010-11) DCIT CIRCLE-1(1)(2), AHMEDABAD V/S M/S. CERA SANITARYAWARE LTD. MADHUBAN HOUSE, OPP. NAVRANGPURA TELPHONE EXCHANGE, NAVRANGPURA (APPELLANT) (RESPONDENT) PAN: AABCM9244N APPELLANT BY : SHRI MUDIT NAGPAL SR. D.R . RESPONDENT BY : SHRI TUSHAR H. VASA ( )/ ORDER DATE OF HEARING : 08 -12-201 7 DATE OF PRONOUNCEMENT : 18-12-2017 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. ITA NOS. 2813 & 2814/AHD/2015 ARE TWO SEPARATE APPE ALS BY THE REVENUE PREFERRED AGAINST THE ORDER OF THE LD. CIT(A)-1, AH MEDABAD DATED 29.07.2015 PERTAINING TO A.YS. 2009-10 & 2010-11. ITA NOS. 281 3 & 2814/AHD/2015 . A.YS. 2009- 10 & 2010-11 2 2. SINCE THE FIRST APPELLATE AUTHORITY HAD DISPOSED TH E APPEALS BY A COMMON ORDER, BOTH THESE APPEALS WERE HEARD TOGETHER AND A RE DISPOSED OF BY THE COMMON ORDER FOR THE SAKE OF CONVENIENCE AND BREVIT Y. WE WILL FIRST TAKE UP ITA NO. 2813/AHD/2015 FOR A.Y . 2009-10 3. THE FIRST GROUND RELATES TO THE DELETION OF THE DIS ALLOWANCE OF EXPENSES CLAIMED ON ACCOUNT OF ESOP AMOUNTING TO RS. 40,58,221/-. 4. WHILE SCRUTINIZING THE RETURN OF INCOME, THE A.O. N OTICED THAT THE ASSESSEE COMPANY AMORTIZED THE EXCESS OF MARKET PRICE OF THE SHARES AT THE RATE OF GRANT OF OPTIONS UNDER THE ESOP SCHEME. 5. THE ASSESSEE WAS ASKED TO EXPLAIN THE TREATMENT MAD E IN THE BOOKS OF ACCOUNTS REGARDING ESOP AND TO JUSTIFY ITS ALLOWABILITY. ASS ESSEE FILED A DETAILED REPLY WHICH IS EXTRACTED AT PAGES 3 TO 5 OF THE ASSESSMEN T ORDER. 6. THE A.O. FOUND THAT THE SAME WAS NOT CONSIDERED IN A.Y. 2008-09. ACCORDINGLY, THE A.O. DISALLOWED THE CLAIM OF RS. 4 0,58,221/-. 7. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) A ND REITERATED ITS CLAIM. AFTER CONSIDERING THE FACTS AND THE CONTENTIONS OF THE AS SESSEE, THE LD. CIT(A) OBSERVED THAT THE A.O. HAS FOLLOWED THE FINDINGS GI VEN IN A.Y. 2007-08 TO A.Y. 2009-10. THE LD. CIT(A) FURTHER FOUND THAT IN THOSE YEARS, THE TRIBUNAL HAS ALLOWED THE CLAIM OF THE ASSESSEE FOLLOWING THE SPE CIAL BENCH JUDGMENT OF THE TRIBUNAL IN THE CASE OF BICON LTD. AND DIRECTED THE A.O. TO ALLOW THE CLAIM OF RS. 40,58,221/-. ITA NOS. 281 3 & 2814/AHD/2015 . A.YS. 2009- 10 & 2010-11 3 8. BEFORE US, THE LD. D.R. COULD NOT BRING ANY DISTING UISHING DECISION IN FAVOUR OF THE REVENUE. 9. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF THE AUTH ORITIES BELOW. WE FIND THAT IN ASSESSEES CASE, THE TRIBUNAL IN EARLIER YEARS H AD ALLOWED THE CLAIM OF THE ASSESSEE FOLLOWING THE DECISION OF THE SPECIAL BENC H OF THE ITAT BANGALORE RENDERED IN THE CASE OF BICON LTD. (SUPRA). ON DUE CONSIDERATION OF THE DETAILS, WE ARE OF THE VIEW THAT THERE IS NO DISPARITY OF TH E FACTS. THE A.O. HAS BASED HIS ORDER EXCLUSIVELY ON THE FINDINGS OF THE ASSESSMENT ORDER OF EARLIER ASSESSMENT YEARS IN WHICH YEARS; THE TRIBUNAL HAD ALLOWED THE CLAIM OF DEDUCTION. RESPECTFULLY FOLLOWING THE FINDINGS OF THE CO-ORDIN ATE BENCH, WE DECLINE TO INTERFERE. GROUND NO. 1 IS DISMISSED. 10. GRIEVANCE RAISED VIDE GROUND NO. 2 IS COMMON IN BOT H YEARS UNDER CONSIDERATION AND RELATE TO THE DELETION OF THE DIS ALLOWANCE OF DEPRECIATION ON FAN AND ELECTRIC INSTALLATIONS. 11. WHILE SCRUTINIZING THE DETAILS OF CLAIMED ON VARIOU S FIXED ASSETS, THE A.O. FOUND THAT THE ASSESSEE HAS CLAIMED DEPRECIATION ON ELECT RIC FITTINGS AND FANS @ 15%. THE A.O. WAS OF THE OPINION THAT DEPRECIATION IS AL LOWABLE @ 10% ON THESE ASSETS. THE ASSESSEE WAS ASKED TO JUSTIFY ITS CLAIM OF DEPRECIATION @ 15%. THE ASSESSEE FILED A DETAILED REPLY WHICH DID NOT FIND ANY FAVOUR WITH THE A.O. WHO RESTRICTED THE CLAIM OF DEPRECIATION @ 10%. 12. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) AND REITERATED ITS CLAIM OF DEPRECIATION @ 15%. AFTER CONSIDERING THE FACTS, TH E LD. CIT(A) FOUND THAT THE A.O. HAS FOLLOWED THE DECISION TAKEN IN A.Y. 2008-0 9 IN WHICH YEAR, THE ITA NOS. 281 3 & 2814/AHD/2015 . A.YS. 2009- 10 & 2010-11 4 TRIBUNAL HAD ALLOWED THE CLAIM OF DEPRECIATION @ 15 % IN ITA NOS. 2817 & 2877/AHD/2011 VIDE ORDER DATED 29.05.2015. FOLLOWI NG THE SAME, THE LD. CIT(A) DIRECTED THE A.O. TO ALLOW DEPRECIATION @ 15 %. 13. ON FINDING PARITY ON THE FACTS OF THE CLAIM OF DEPR ECIATION AND ON FINDING THAT THE CO-ORDINATE BENCH HAS ALLOWED THE CLAIM OF DEPR ECIATION @ 15%, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). THE COMMON GRIEVANCE IS ACCORDINGLY DISMISSED. 14. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS D ISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 18 - 12- 20 17 SD/- SD/- (RAJPAL YADAV) (N. K. BILLAIYA) JUDICIAL MEMBER TRUE COPY A CCOUNTANT MEMBER AHMEDABAD: DATED 18 /12/2017 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD