Tej Kumar, Book Depot Private Limited, Lucknow V. Dy. Commissioner of Income Tax, Lucknow

ITA 282/LKW/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92166 (ITAT-LUCKNOW)
• Duration Of Justice: 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 17-06-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 08-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P K KAPOOR
• Keywords: Business income; Depreciation
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI. A. K. GARODIA, ACCOUNTANT MEMBER ITA NO.282/LKW/2015 ASSESSMENT YEAR:2010-11 TEJ KUMAR BOOK DEPOT PRIVATE LIMITED 1, TRILOKI NATH ROAD, HAZRATGANJ LUCKNOW V. DCIT-VI LUCKNOW TAN/PAN:AABCT9555F (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI. P. K. KAPOOR, C.A. RESPONDENT BY: SHRI. AMIT NIGAM, D.R. DATE OF HEARING: 17 06 2015 DATE OF PRONOUNCEMENT: 25 06 2015 O R D E R PER SUNIL KUMAR YADAV: THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A) ON VARIOUS GROUNDS, BUT THEY ALL RELATE TO THE CONFIRMATION OF DISALLOWANCE OF RS.4,68,834/- CLAIMED AS DEDUCTION UNDER SECTION 24(A) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER CALLED IN SHORT THE ACT') ON RENTAL INCOME DERIVED FROM LETTING OUT OFFICE SPACE IN THE PROPERTIES AT PUNE AND LUCKNOW. 2. DURING THE COURSE OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE HAS INVITED OUR ATTENTION THAT IN THE RETURN OF INCOME THE ASSESSEE HAS WRONGLY CLAIMED DEPRECIATION ON FURNITURE AND FIXTURES AT RS.53,453/- BESIDES CLAIMING RENTAL INCOME AS INCOME FROM HOUSE PROPERTY. THE ASSESSING OFFICER WAS OF THE VIEW THAT SINCE THE ASSESSEE HAS CLAIMED DEPRECIATION ON FURNITURE AND FIXTURES, NO STANDARD DEDUCTION UNDER SECTION 24 OF THE ACT :- 2 -: CAN BE ALLOWED AND HE ACCORDINGLY DISALLOWED DEDUCTION CLAIMED UNDER SECTION 24 OF THE ACT RESULTING INTO AN ADDITION OF RS.4,68,834/-. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER CONTENDED THAT IN THE IMMEDIATELY PRECEDING YEAR ALSO, THE ASSESSEE HAS INADVERTENTLY CLAIMED DEPRECIATION ON FURNITURE AND FIXTURES AND THE ASSESSING OFFICER HAS MADE DISALLOWANCE OF DEDUCTION CLAIMED UNDER SECTION 24 OF THE ACT, AGAINST WHICH AN APPEAL WAS FILED BEFORE THE LD. CIT(A) AND THE LD. CIT(A) HAS DENIED DEPRECIATION, BUT ALLOWED DEDUCTION UNDER SECTION 24(A) OF THE ACT. THIS FINDING OF THE LD. CIT(A) WAS NOT CHALLENGED BY THE DEPARTMENT, THEREFORE, IT ATTAINED FINALITY. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER CONTENDED THAT IN THE LIGHT OF THE FINDING OF THE LD. CIT(A) IN ASSESSMENT YEAR 2009-10, THE ISSUE MAY KINDLY BE DECIDED. 3. THE LD. D.R., ON THE OTHER HAND, HAS PLACED RELIANCE UPON THE ORDER OF THE LD. CIT(A). 4. HAVING CAREFULLY EXAMINED THE ORDERS OF THE LOWER AUTHORITIES IN THE LIGHT OF THE RIVAL SUBMISSIONS, WE FIND THAT SIMILAR DISALLOWANCE WAS MADE IN ASSESSMENT YEAR 2009-10 BUT IN APPEAL THE LD. CIT(A) HAS DENIED DEPRECIATION BUT ALLOWED DEDUCTION UNDER SECTION 24(A) OF THE ACT AND THIS FINDING OF THE LD. CIT(A) WAS NOT CHALLENGED BY THE REVENUE, THEREFORE, IT ATTAINED FINALITY. THE RELEVANT OBSERVATIONS OF THE LD. CIT(A) ARE EXTRACTED HEREUNDER FOR THE SAKE OF REFERENCE:- 6(2) I HAVE EXAMINED THE FACTS AND CIRCUMSTANCES OF THE CASE. I HAVE EXAMINED THE FINDINGS OF THE ASSESSING OFFICER AND THE SUBMISSIONS OF THE APPELLANT. I FIND THAT THE AO HAS NOT IDENTIFIED THE EXPENSES CLAIMED IN RESPECT OF THE PROPERTY RENTED OUT AT PUNE TO M/S KUENE + NAGEL (P) LTD. FROM 01.05.2008 @ RS.1,07,525/- PER MONTH. THE INCOME FROM HOUSE PROPERTY WAS ACCEPTED IN THE ASSESSMENT ORDER PASSED UNDER SECTION 143(3) OF THE ACT FOR ASSESSMENT YEAR 2007-08 ON 23.11.2009 AND FOR ASSESSMENT YEAR 2008-2009 ON 30.12.2010. THERE IS NO JUSTIFICATION WITH THE AO IN :- 3 -: TREATING THE INCOME AS BUSINESS INCOME WITHOUT PROPER EXAMINATION. THE ADDITION OF RS.331,746/- BY WAY OF DISALLOWANCE OF DEDUCTION UNDER SECTION 24(A) OF THE ACT IS DELETED GIVING RELIEF TO THE APPELLANT. 5. SINCE IN THE IMMEDIATELY PRECEDING YEAR THE LD. CIT(A) HAS ALLOWED RELIEF TO THE ASSESSEE AND THE ORDER OF THE LD. CIT(A) HAS ATTAINED FINALITY, WE FIND NO REASON TO TAKE A CONTRARY VIEW IN THIS APPEAL. WE ACCORDINGLY DIRECT THE ASSESSING OFFICER TO DENY DEPRECIATION CLAIMED ON FIXTURE AND FURNITURE BUT ALLOW DEDUCTION UNDER SECTION 24(A) OF THE ACT AND TREAT THE RENTAL INCOME AS INCOME FROM HOUSE PROPERTY. ACCORDINGLY THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTIONED PAGE. SD/- SD/- [A. K. GARODIA] [SUNIL KUMAR YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:25 TH JUNE, 2015 JJ:106 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR ASSISTANT REGISTRAR