Torrent Power Ltd., Surat V. The ACIT.,Circle-4, Surat

ITA 293/AHD/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6236 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 13-06-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 25-01-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KARTAR SINGH
• Assessee Lawyers: S N SOPARKAR
• Keywords: Depreciation; Revenue expenditure; Capital expenditure
• Section: 143(3); 32

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH A BEFORE SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER DATE OF HEARING : 13/06/2011 DRAFTED ON: 13/06/2011 1. ITA NO.293/AHD/2008 A.Y. 2004-05 2. ITA NO.771/AHD/2008 A.Y. 2004-05 1. TORRENT POWER LTD. ( FORMERLY KNOWN AS TORRENT POWER SEC.LTD. ) TORRENT HOUSE STATION ROAD,SURAT 2. THE ACIT CIRCLE-4, SURAT VS. 1. ACIT, CIRCLE-4, SURAT 2. TORRENT POWER LTD. SURAT PAN/GIR NO. : AAACT 8629 D ( APPELLANTS ) .. ( RESPONDENTS ) ASSESSEE BY : SHRI S.N.SOPARKAR, A.R. REVENUE BY: SHRI KARTAR SINGH, CIT-D.R. O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THESE CROSS APPEALS HAVE ARISEN FROM THE ORDER OF THE LEARNED CIT(APPEALS)-I, SURAT DATED 31/12/2007 FOR ASSESSME NT YEAR 2004-05. THESE APPEALS ARE CONSOLIDATED AND HEREBY DECIDED B Y THIS COMMON ORDER. (A) ASSESSEES APPEAL; ITA NO.293/AHD/2008 2. GROUND NOS.1 & 2 READ AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE CIT(A) HAS ERRED IN REJECTING THE ASSESSEES CLAIM THAT TH E LEASEHOLD RIGHT FOR 99 YEARS WAS NOT AN INTANGIBLE ASSET ENVISAGED IN SECTION 32 ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 2 - AND CONSEQUENTLY ERRED IN NOT ACCEPTING THE ASSESSE ES CLAIM OF DEPRECIATION ON COST/WDV OF THE SAME. 2. WITHOUT PREJUDICE, ON THE FACTS AND IN THE CIRC UMSTANCES OF THE CASE, SINCE THE WHOLE OF THAT SUM HAD NOT BEEN ALLO WED IN ANY PAST YEAR ON REVENUE ACCOUNT THE ASSESSEE WAS ENTITLED T O DEDUCTION FOR THE SUM ATTRIBUTABLE TO THE RELEVANT PREVIOUS YEAR (BEING TOTAL PREMIUM DIVIDED BY 99) BECAUSE THE LESE WAS OPERATI VE FOR 99 YEARS. 2. FACTS IN BRIEF AS EMERGED FROM THE CORRESPONDING ASSESSMENT ORDER PASSED U/S. 143(3) OF THE I.T. ACT, 1961 DATED 28 /12/2006 WERE THAT THE ASSESSEE IS A PUBLIC LIMITED COMPANY AND IN THE BUS INESS OF TRANSMISSION AND DISTRIBUTION OF ELECTRICITY POWER IN SURAT CITY . THE ASSESSEE- COMPANY IS PURCHASING ELECTRICITY POWER FROM GUJARA T ELECTRICITY BOARD AND DISTRIBUTING TO VARIOUS CUSTOMERS. THE ASSESSE E HAS CLAIMED DEPRECIATION @ 25% ON A LEASED HOLD LAND. FOLLOWI NG THE PAST HISTORY OF CASE FOR ASSESSMENT YEARS 2002-03 & 2003-04 CLAIM O F DEPRECIATION OF RS.53,99,742/- WAS DISALLOWED AND ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. THE MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY WHO HAS ALSO FOLLOWED THE DECISIONS OF HIS PREDECESSOR AND REJECTED THE GROUNDS OF THE ASSESSEE. 2.1. IN THE PAST FOR ASSESSMENT YEAR 2003-04 IN ASS ESSEES APPEAL BEARING ITA NO.644/AHD/2007 ITAT A BENCH AHMEDABA D VIDE AN ORDER DATED 10/12/2010 THERE WAS A REFERENCE OF AN ORDER OF THE TRIBUNAL DATED 23/12/2008 FOR ASSESSMENT YEAR 2002-03 WHEREI N ASSESSEES OWN ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 3 - CASE BEARING CO NO.254/AHD/2006 THE ISSUE WAS DECIDED AGAINST THE ASSESSEE. RELEVANT PARAGRAPHS ARE REPRODUCED BELOW:- 4.1. THE ISSUE IS ABOUT NON-ALLOWANCE OF DEPRECIATI ON OF RS.44,88,656/- CLAIMED @ 25% ON THE LEASEHOLD RIGHT LAND. THE FIRST APPELLATE AUTHORITY HAS RELIED UPON THE ORDER OF HIS PREDECESSOR FOR ASSESSMENT YEAR 2002-03 AND DECIDED THE SAME AGAINST THE ASSESSEE. IN THAT YEAR, THE MATTER W AS CARRIED BY THIS ASSESSEE BEFORE THE TRIBUNAL AND VIDE ORDER DATED 2 3/12/2008 (REFERENCE SUPRA), WHILE DECIDING THE CROSS OBJECTI ON OF THE ASSESSEE VIDE PARAGRAPH NO.27 IT WAS HELD AS UNDER: - 27. WE HAVE HEARD THE RIVAL SUBMISSIONS AND, PERUS ED THE MATERIAL ON RECORD ALONG WITH THE ORDER OF THE AUTH ORITIES BELOW. WE HAVE ALSO GONE THROUGH THE VARIOUS DECISIONS AS RELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE BEFORE THE CIT(A) AS WELL AS BEFORE US. WE FIND THAT THE PAYMENT OF PR EMIUM FOR OBTAINING THE 99 YEARS LEASE WAS EVIDENTLY AN EXPENDITURE INCURRED IN CAPITAL FIELD FOR OBTAINING AN ASSET OF ENDURING NATURE, WHICH CANNOT STAND ON A DIFFERENT FOOTING T HAN THE COST OF THE LAND, AS SPENT BY ANYBODY FOR PURCHASE OF LA ND. THE MERE FACT THAT SOME SUCH REQUIREMENTS OR CONDITIONS HAVE BEEN SPECIFIED IN THE LEASE DEED DOES NOT HOWEVER, FETTE R THE RIGHTS OF THE LESSEE OR CREATE ANY IMPEDIMENTS IN THE ENJOYME NT OF ITS RIGHT OVER USER OF THE LAND SO AS TO INTERFERE WITH OR LESSEN OR IN ANY MANNER CHANGE THE ENDURING NATURE OF THE RIGHTS GRANTED TO THE ASSESSEE THROUGH THE LEASE DEED. WE FIND THAT T HE PREMIUM PAID FOR OBTAINING THE 99 YEARS LEASE FROM THE SMC CANNOT BE TREATED AS INTANGIBLE ASSET AND NO DEPRECIATION WOULD BE ADMISSIBLE TO THE ASSESSEE AS PER THE PROVISION OF THE ACT. WE FURTHER FIND THAT THE LAN D DEVELOPED BY THE SMC WOULD NOT FALL IN THE CATEGORY OF A COMMERC IAL OR BUSINESS RIGHT AND NOT BE ENTITLED TO DEPRECIATION. IF ANY DEPRECIATION IS ALLOWED IN THESE FACTS AND CIRCUMST ANCES, THAT WILL BE EVIDENTLY OPPOSED TO THE ACCEPTED LEGAL POS ITION. THE PREMIUM PAID FOR OBTAINING THE 99 YEARS LEASE FROM THE SMC CANNOT BE TREATED AS AN INTANGIBLE ASSET AND NO DEP RECIATION WOULD, THEREFORE, BE ADMISSIBLE THEREON IN ACCORDAN CE WITH THE PROVISIONS OF THE ACT. FURTHER, THE OBTAINING OF LAND FROM THE SMC WAS IN THE NATURE OF CAPITAL EXPENDITURE FOR OB TAINING ENDURING BENEFIT IN POSSESSION OF LAND FOR A PERIOD OF 99 YEARS. THEREFORE, THIS EXPENDITURE CANNOT BE ALLOW ED AS REVENUE EXPENDITURE. ACCORDINGLY, THIS ISSUE OF THE CROSS ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 4 - OBJECTION OF THE ASSESSEE IS DISMISSED. ( EMPHASI S GIVEN BY US ) 5. THIS ISSUE HAD ONCE BEEN DECIDED BY THE M UMBAI BENCHES IN THE CASE OF GOVIK ELECTRICALS 96ITD70/ 97 TTJ75(MUM.) (ONE OF US I.E JM IS THE PARTY) AND HELD THAT THE LUMP-S UM PAYMENT MADE AS A CONSIDERATION FOR ACQUIRING THE RIGHTS OV ER THE PROPERTY WAS IN THE NATURE OF CAPITAL EXPENDITURE. FURTHER, ON IDENTICAL FACTS AND CIRCUMSTANCES IN ASSESSEES OWN CASE ONCE THE ISSUE OF DISALLOWANCE OF DEPRECIATION HAS ALREADY BEEN DECID ED IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE BY THE RES PECTED COORDINATE BENCH FOR A.Y. 2002-03, THEREFORE, IN TH E IDENTICAL MANNER FOR THE YEAR UNDER CONSIDERATION, I.E. 2003- 04, THIS GROUND OF THE ASSESSEE IS HEREBY DISMISSED. 2.2. HOWEVER, NOW BEFORE US AN ANOTHER ORDER OF ITA T A BENCH AHMEDABAD FOR ASSESSMENT YEAR 2005-06 IS ALSO PLACE D ON RECORD BEARING ITA NO.3133 & 3331/AHD/2008 ORDER DATED 21 /01/2001, WHEREIN THERE IS A REFERENCE OF THE ABOVE CITED DEC ISION OF THE TRIBUNAL OF ASSESSMENT YEAR 2003-04 BUT THE RESPECTED CO-ORDINA TE BENCH HAS CITED A DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF DCIT VS. SUN PHARMACEUTICALS IND. LTD. REPORTED AT (2 010)329 ITR 479 (GUJ.), WHEREIN THE ISSUE OF LEASE RENT WAS DECIDED AND HELD THAT THE SAME IS ALLOWABLE AS REVENUE EXPENDITURE AFTER FOLLOWING THE ORDER OF THE HONBLE HIGH COURT. RESPECTED BENCH HAD THOUGHT IT PROPER TO RE- EXAMINE THE ENTIRE ISSUE IN THE LIGHT OF THE DECISI ON OF THE HON'BLE GUJARAT HIGH COURT. IN THE RESULT, THE MATTER WAS RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO EXAM INE THE LEGAL POSITION AND TO DECIDE ACCORDINGLY. THE RELEVANT PARAGRAPH NO.4 REPRODUCED BELOW:- ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 5 - 4. WE HAVE HEARD RIVAL CONTENTIONS AND GONE THROU GH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT THESE INTER-CONNECTED ISSUES NEEDS RE-EXAMINATION AT THE LEVEL OF ASSESSI NG OFFICER IN THE LIGHT OF THE DECISION OF HON'BLE JURISDICTIONAL HIG H COURT IN THE CASE OF SUN PHARMACEUTICALS IND. LTD. (SUPRA) AND A SSESSING OFFICER WILL ALSO EXAMINE LEASE AGREEMENTS AND OTHE R DOCUMENTS IN DETAIL AND THEN DECIDE THE ISSUE. THE ASSESSING OF FICER WILL EXAMINE THE LATEST LEGAL POSITION AS STAND ON THAT DATE. ACCORDINGLY, THESE INTER-CONNECTED ISSUES OF THE AS SESSEES APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES. 3. ON THIS SHORT SUBMISSION OF RESTORATION, LEARNE D DEPARTMENTAL REPRESENTATIVE MR.KARTAR SINGH HAD NO OBJECTION BUT STATED THAT ONCE THE MATTER HAS BEEN DECIDED BY THE HON'BLE HIGH COURT, THOUGH THE ASSESSING OFFICER HAD LEFT WITH A LIMITED SCOPE BUT STILL HAS TO VERIFY THE CONNECTED FACTS TO APPLY THE RATIO LAID IN THE SAID PRECEDENT. THE SAID VERDICT IS AS FOLLOWS, REPRODUCED FROM THE HEAD NOT ES(329 ITR 479):- THE ASSESSEE-COMPANY CLAIMED DEDUCTION OF A SUM OF RS.48,02,616 BEING PAYMENT TO GIDC. IT CONTENDED T HAT THE LEASE RENT IN RESPECT OF THE LAND ALLOTTED TO THE ASSESSE E-COMPANY BEING VERY NOMINAL, I.E., AT RS.40 PER YEAR, THE PAYMENT WAS NOTHING ELSE BUT ADVANCE RENT AND HENCE, ALLOWABLE AS REVENUE EX PENDITURE. AFTER GOING THROUGH THE LEASE AGREEMENT THE ASSESSI NG OFFICER DISALLOWED THE CLAIM HOLDING THAT THE ASSESSEE HAD ACQUIRED A BENEFIT OF ENDURING NATURE IN THE FORM OF USE OF LA ND FOR A PERIOD OF 99 YEARS; THAT THE LAND HAD BEEN TRANSFERRED THROUG H A REGISTERED DEED INVOLVING TRANSFER OF IMMOVABLE PROPERTY AND T HUS, THE ASSESSEE HAD ACQUIRED A FIXED ASSET IN THE FORM OF A PARCEL OF LAND. THE TRIBUNAL HELD THAT THE LEASE RENT WAS DEDUCTIBL E. ON APPEAL TO THE HIGH COURT: HELD, DISMISSING THE APPEAL, THAT THE TRIBUNAL HAD FOUND THAT THE LAND IN QUESTION WAS NOT ACQUIRED BY THE ASSESSEE. MERELY BECAUSE ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 6 - THE DEED WAS REGISTERED THE TRANSACTION IN QUESTION WOULD NOT ASSUME A DIFFERENT CHARACTER. THE LEASE RENT WAS V ERY NOMINAL. BY OBTAINING THE LAND ON LEASE THE CAPITAL STRUCTUR E OF THE ASSESSEE DID NOT UNDERGO ANY CHANGE. THE ASSESSEE ONLY ACQU IRED A FACILITY TO CARRY ON BUSINESS PROFITABLY BY PAYING NOMINAL L EASE RENT. THE LEASE RENT PAID BY THE ASSESSEE TO GIDC WAS ALLOWAB LE AS REVENUE EXPENDITURE. 4. ON CAREFUL READING OF THE JUDGEMENT OF SUN PHARM ACEUTICALS IND. LTD.(SUPRA), WE HAVE FOUND THAT THE ISSUE WAS CONFI NED TO THE QUESTION OF DEDUCTIBILITY OF THE LEASE RENT. DISMISSING THE AP PEAL OF THE REVENUE, THE COURT HAS SAID THAT THE TRIBUNAL HAD FOUND THAT THE LAND IN QUESTION WAS NOT ACQUIRED BY THE ASSESSEE. MERELY BECAUSE THE D EED WAS REGISTERED THE TRANSACTION IN QUESTION WOULD NOT ASSUME A DIFFEREN T CHARACTER. BY OBTAINING THE LAND ON LEASE THE ASSESSEE HAS ACQUIR ED A FACILITY TO CARRY ON BUSINESS BY PAYING NOMINAL LEASE RENT, THEREFORE, L ESE RENT PAID WAS HELD ALLOWABLE AS REVENUE EXPENDITURE. IN THIS CONTEXT WE MAY LIKE TO ADD THAT THOUGH THE RESPECTED CO-ORDINATE BENCH VIDE AN ORDER DATED 21.1.2011 FOR A.Y. 2005-06 HAS RESTORED BOTH THE GR OUNDS FOR RE- ADJUDICATION BY ASSESSING OFFICER BUT THE DISTINCTI ON BETWEEN THE TWO GROUNDS IS THAT GROUND NO.1 IS ABOUT CLAIM OF DEPRE CIATION ON LEASE HOLD- RIGHTS AND GROUND NO.2 IS ABOUT THE CLAIM OF EXPEND ITURE PERTAINING TO THE SAID LEASE. THE HONBLE COURT HAS DECIDED ONLY IN RESPECT OF DEDUCTIBILITY OF LEASE RENT BUT SINCE THE MATTER NO W STOOD RESTORED BACK TO ASSESSING OFFICER, THEREFORE, WE HEREBY DIRECT TO K EEP IN MIND THIS SUBTLE DISTINCTION AND RE-DECIDE AS PER LAW. IDENTICALLY, THESE TWO GROUNDS MAY BE TREATED AS ALLOWED BUT FOR STATISTICAL PURPOSES. ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 7 - 5. GROUND NO.3 & GROUND NO.6 READ AS UNDER: 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE CIT(A) HAS ERRED IN NOT ACCEPTING THE ASSESSEES CLAIM THA T THE METERS INSTALLED BY THE ASSESSEE WERE ENERGY SAVING DEVICE S ENTITLED TO DEPRECIATION @ 80% AS MENTIONED IN APPENDIX-I, PART- III(8)(IX)B.(E) OF THE I.T.RULES, 1962. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE CIT(A) HAS ERRED IN NOT FOLLOWING THE VIEW TAKEN IN RESPEC T OF THE RATE OF DEPRECIATION ON METERS BY HIS PREDECESSOR IN THE AS SESSEES OWN CASE FOR A.Y. 2002-03. 5.1. THESE TWO GROUNDS HAVE A COMMON ISSUE ABOUT TH E DEPRECIATION ON ELECTRIC METERS. THE ASSESSEE HAS CLAIMED DEPRECIA TION @ 80% ON METERS AND CAPACITORS, HOWEVER, THE ASSESSING OFFICER WAS OF THE OPINION THAT THE ASSESSEE IS NOT ENTITLED TO DEPRECIATION @ 80% SINCE THE METERS ARE INSTALLED FOR MEASUREMENT OF CONSUMPTION OF ENERGY AND NOT FOR PRESERVATION OF THE ENERGY. THE MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY AND THE LEARNED CIT(APPEALS) HA S DISMISSED THE GROUNDS. 5.2. FOR ASSESSMENT YEAR 2003-04, THE RESPECTED ITA T A BENCH AHMEDABAD BEARING ITA NO.517/AHD/2007 & 644/AHD/200 7 VIDE ORDER DATED 10/12/2010 HAS REFERRED AN ANOTHER DECISION O F THIS VERY TRIBUNAL BEARING ITA NO.1998/AHD/2006 & CO NO.254/AHD/2006 D ATED 23/12/2008. AFTER THE REPRODUCTION OF THE RELEVANT PARAGRAPH, THE TRIBUNAL HAS SAID THAT DEPRECIATION IS TO BE ALLOWE D BUT RATE OF DEPRECIATION IS TO BE APPLIED AS PER THE PRESCRIBED RATES FOR THE YEAR ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 8 - UNDER CONSIDERATION. IN IDENTICAL MANNER, WE HEREB Y DIRECT ACCORDINGLY, THUS ALLOWED FOR STATISTICAL PURPOSE. 6. GROUND NO.4 & GROUND NO.5 READ AS UNDER: 4. WITHOUT PREJUDICE, ON THE FACTS AND IN THE CIR CUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN NOT ACCEPTING THE ASS ESSEES CLAIM THAT REPLACEMENT COST OF OLD METERS WAS DEDUCTIBLE AS A REVENUE EXPENDITURE IN PURSUANCE OF SECTION 31(I). WITHOUT PREJUDICE, ON THE FACTS AND IN THE CIRCUMST ANCES OF THE CASE, THE CIT(A) HAS ERRED IN NOT ALLOWING THE COST OF METERS AS A REVENUE EXPENDITURE AS THE ASSESSEE HAD REPLACED THE OLD METERS U/S.37 OF THE ACT. 6.1. ONCE THE CONNECTED GROUNDS IN RESPECT OF METER S HAVE ALREADY BEEN CONSIDERED HEREINABOVE, THEREFORE, LEARNED AUTHORIS ED REPRESENTATIVE MR.S.N.SOPARKAR HAS EXPRESSED NOT TO PRESS THESE TW O GROUNDS. EVEN IN ASSESSMENT YEAR 2005-06 IN ITA NO.3133/AHD/2008 ORD ER DTED 21.1.2011, THE LEARNED AUTHORISED REPRESENTATIVE HA S NOT CONTESTED THESE TWO GROUNDS. RESULTANTLY, THESE GROUNDS ARE DISMISSED. 7. GROUND NO.7 IS IN RESPECT OF LEVY OF INTEREST U/ S.234-B, 234C AND 234D WHICH ARE CONSEQUENTIAL IN NATURE AND GROUND N O.8 IS GENERAL IN NATURE, THEREFORE, THESE GROUNDS NEED NO INDEPENDEN T ADJUDICATION. 8. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLOWED . (B) REVENUES APPEAL; ITA NO.771/AHD/2008 FOR A. Y. 2004-05 ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 9 - 9. GROUND NO.1 READS AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF CASE IN LAW, THE LEARNED CIT(A) HAS ERRED IN ALLOWING EXCESS DEPRECIATION CLAIMED AT 80% AS AGAINST 25% RESTRICTED BY THE A.O., ON CIRCUIT BREAKERS, ISOLATORS, CONTROL PANEL, TRANSFORMERS AND LIGHTING ARRESTOR. 9.1. AT THE OUTSET, IT HAS BEEN INFORMED THAT THE Q UESTION OF CLAIM OF DEPRECIATION ON CIRCUIT BREAKERS, ISOLATORS, CONTRO L PANELS, TRANSFORMERS, ETC. AS RAISED IN THE GROUNDS OF APPEAL WAS NOT ADJ UDICATED BY THE LEARNED CIT(APPEALS), HENCE, THE ISSUE NOW RAISED BY THE RE VENUE IS NOT RELEVANT FOR THIS APPEAL. FROM THE SIDE OF THE REVENUE THIS FACTUAL ASPECT WAS NOT CONTRADICTED. UNDER THESE CIRCUMSTANCES, WE FIND N O FORCE IN THIS GROUND OF THE REVENUE, HENC E DISMISSED . 10. GROUND NO.2 READS AS UNDER: 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF CAS E AND IN LAW, THE LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS.90,00,000/- MADE BY THE A.O. ON ACCOUNT OF DISALLOWANCE OF PROVISION OF WAGE SETTLEMENT DEBITED TO PROFIT AND LOSS ACCOUNT. 10.1 WHILE DECIDING APPEAL FOR AY 2005-06 IN ITA NO .3133 & 3331/AHD/2008 ORDER DATED 21/01/2011, IT WAS HELD T HAT THE ISSUE WAS COVERED BY AN EARLIER ORDER OF THIS TRIBUNAL IN ASS ESSEES OWN CASE FOR ASSESSMENT YEAR 2003-04 BEARING ITA NOS.517 & 644/A HD/2007 ORDER DATED 10/12/2010, WHEREIN VIDE PARAGRAPH NO.3 IT WA S HELD AS UNDER:- 3. FOR THE YEAR UNDER CONSIDERATION THE FACTS ARE STATED TO BE IDENTICAL DUE TO THE REASON THAT ON THE SAME LINES A PROVISION I N ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 10 - RESPECT OF THE WAGE SETTLEMENT OF RS.2,70,00,000/- WAS MADE AND THE FIRST APPELLATE AUTHORITY HAS SIMPLY FOLLOWED H IS PREDECESSORS ORDER OF THE A.Y. 2002-03. ONCE THIS VERY GROUND O F THE REVENUE HAS ALREADY BEEN DISMISSED BY THE RESPECTED CO-ORDI NATE BENCH FOR THE A.Y. 02-03, RELEVANT PORTIONS REPRODUCED , THEREFORE, THE JUDICIAL PROPRIETY REQUIRES ONE BENCH OF THE TRIBU NAL TO FOLLOW ANOTHER BENCH WHERE FACTS AND THE CIRCUMSTANCES AR E LIKE PEAS IN A POD. WE FIND NO REASON TO ADOPT ANY OTHER VIEW B ECAUSE ON THESE VERY FACTS AND CIRCUMSTANCES, THE AFORESAID RESPECTED CO- ORDINATE BENCH HAS ALREADY TAKEN A DECISION THAT THE PROVISION SO MADE FOR ENHANCED WAGES WAS NOT A CONTINGENT LIABIL ITY BUT AN ANTICIPATED EXPENDITURE ACCRUED THIS YEAR THEREFORE AN ALLOWABLE REVENUE EXPENDITURE HENCE THAT VIEW OUGHT TO BE FOLLOWED IN THE PRESENT APPEAL. THUS, THE GROUND RAISED BY THE REV ENUE IS DISMISSED. 11. WE HAVE HEARD THE SUBMISSIONS OF BOTH THE SIDES AND ON CAREFUL PERUSAL OF THE ORDERS OF THE AUTHORITIES BELOW, SIN CE THE FACTS IN RESPECT OF THE ALLOWABILITY OF THE PROVISIONS OF WAGE SETTLEM ENT WERE IDENTICAL, THEREFORE, FOLLOWING THE PAST HISTORY WE FIND NO FO RCE IN THIS GROUND OF THE REVENUE AND HEREB Y DISMISSED. 12. REST OF THE GROUNDS ARE GENERAL IN NATURE NEED NO INDEPENDENT ADJUDICATION. ITA NO.293/AHD/2008(BY ASSESSEE) & ITA NO.771/AHD/2008(BY REVENUE) TORRENT POWER LTD. VS. ACIT ASST.YEAR 2004-05 - 11 - 13. IN THE RESULT, ASSESSEES APPEAL IS PARTLY AL LOWED AND THAT OF REVENUE IS DISMISSED. ORDER SIGNED, DATED AND PRONOUNCED IN THE COURT ON 30 TH JUNE, 2011. SD/- SD/- ( A.K. GARODIA ) ( MUKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JUDICIAL MEM BER AHMEDABAD; DATED 30 / 6 /2011 T.C. NAIR, SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE ASSESSEE. 2. THE DEPA RTMENT. 3. THE CIT CONCERNED. 4. THE LD. CIT(A PPEALS)-I, SURAT 5. THE DR, AHMEDABAD BENCH. 6. THE GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT.REGISTRAR), ITAT, AHMEDABAD 1. DATE OF DICTATION..13/06/2011 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 14/06/2011 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S30.6.11 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 30.6.11 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 9. DATE OF DESPATCH OF THE ORDER