M/s.Oberon Trading Corpn, Trivandrum V. The ITO, Trivandrum

ITA 294/COCH/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69044 (ITAT-COCHIN)
• Duration Of Justice: 6 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 12-11-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 13-05-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: K K JOHN
• Keywords: Depreciation
• Section: 263

Judgement Text

1 ITA NO.294/COCH/2013 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) I.T.A NO. 294/COCH/2013 (ASSESSMENT YEAR 2005-06) M/S OBERON TRADING CORPORATION VS ITO, WD.1(2) THE ARCADE, KILLIPALAM TRIVANDRUM KARAMANA, THIRUVANANTHAPURAM PAN : AAAFO3524F (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ANIL D NAIR RESPONDENT BY : SHRI K.K. JOHN DATE OF HEARING : 12-11-2013 DATE OF PRONOUNCEMENT : 22-11-2013 O R D E R PER N.R.S. GANESAN (JM) THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE CIT(A), TRIVANDRUM DATED 01-03-2013. 2. SHRI ANIL D NAIR, THE LD.COUNSEL FOR THE ASSESSE E SUBMITTED THAT CONSEQUENT TO THE REVISIONAL ORDER PASSED BY THE CO MMISSIONER OF INCOME-TAX, THE ASSESSING OFFICER DISALLOWED THE DE PRECIATION. THE REVISIONAL ORDER WAS CHALLENGED BEFORE THIS TRIBUNA L AND THE TRIBUNAL CONFIRMED THE ORDER OF THE COMMISSIONER OF INCOME-T AX. ON FURTHER APPEAL 2 ITA NO.294/COCH/2013 BEFORE THE HIGH COURT, THE HIGH COURT DISMISSED THE APPEAL OF THE ASSESSEE BY CONFIRMING THE ORDER OF THIS TRIBUNAL. THEREFORE, THE LD.COUNSEL SUBMITTED THAT AT THIS STAGE, THE ORDER PASSED BY THE CIT(A) CANNOT BE FOUND FAULT WITH. 3. WE HEARD SHRI K.K. JOHN, THE LD.DR ALSO. ACCORD ING TO THE LD.DR, THE FIRST APPELLATE AUTHORITY, AFTER REFERRING TO THE O RDER OF THIS TRIBUNAL ON THE APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF T HE ADMINISTRATIVE COMMISSIONER, DISALLOWED THE CLAIM OF DEPRECIATION. THE LD.DR SUBMITTED THAT THE HIGH COURT WHILE CONFIRMING THE ORDER OF T HIS TRIBUNAL FOUND THAT THE PARTNERSHIP FIRM CONTINUES ITS BUSINESS TOGETHE R WITH ALL ASSETS AND LIABILITIES. THEREFORE, THERE CANNOT BE ANY CLAIM OF DEPRECIATION ON THE AMOUNT PAID TO THE RETIRING PARTNER. SINCE THE CLA IM MADE BY THE ASSESSEE TOWARDS DEPRECIATION WAS DISALLOWED BY THIS TRIBUNA L WHICH WAS ALSO CONFIRMED BY THE HIGH COURT, ACCORDING TO THE LD.DR , THE CIT(A) HAS RIGHTLY REJECTED THE CLAIM OF THE ASSESSEE. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. ORIGINAL LY, THE ASSESSING OFFICER 3 ITA NO.294/COCH/2013 ALLOWED THE CLAIM OF DEPRECIATION ON THE AMOUNT PAI D TO THE RETIRING PARTNER. HOWEVER, THE ADMINISTRATIVE COMMISSIONER, IN EXERCISE OF HIS REVISIONAL JURISDICTION U/S 263 FOUND THAT THE AMOU NT PAID TO THE RETIRING PARTNER IS NOT ELIGIBLE FOR DEPRECIATION. THIS ORD ER OF THE ADMINISTRATIVE COMMISSIONER WAS CHALLENGED BEFORE THIS TRIBUNAL. THIS TRIBUNAL FOUND THAT THE PARTNERSHIP FIRM IS AN INDEPENDENT AND SEP ARATE ASSESSABLE UNIT. THE FIRM CONTINUED ITS BUSINESS EVEN AFTER RETIREME NT OF THE PARTICULAR PARTNER. THE ASSETS AND LIABILITIES INCLUDING THE COMMERCIAL RIGHTS, TRADEMARK, GOODWILL, ETC. CONTINUED WITH THE PARTNE RSHIP FIRM EVEN BEFORE AND AFTER RETIREMENT OF THE PARTNER. THEREFORE, TH IS TRIBUNAL FOUND THAT THE ASSESSEE MAY NOT BE ELIGIBLE FOR ANY DEPRECIATION. THIS ORDER OF THE TRIBUNAL WAS CHALLENGED BEFORE THE HIGH COURT AND T HE HIGH COURT CONFIRMED THE ORDER OF THIS TRIBUNAL. THEREFORE, T HIS TRIBUNAL IS OF THE OPINION THAT THE ASSESSEE IS NOT ELIGIBLE FOR DEPRE CIATION IN RESPECT OF THE AMOUNT PAID TO THE RETIRING PARTNER. IN VIEW OF TH E ABOVE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A). ACCORDIN GLY, THE SAME IS CONFIRMED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS DISMISSED. 4 ITA NO.294/COCH/2013 ORDER PRONOUNCED IN THE OPEN COURT ON THIS 22 ND DAY OF NOVEMBER, 2013. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 22 ND NOVEMBER, 2013 PK/- COPY TO: 1. M/S OBERON TRADING CORPORATION, THE ARCADE, KILL IPALAM, KARAMAN, THIRUVANANTHAPURAM 2. ITO, WD.1(2), TRIVANDRUM 3. THE COMMISSIONER OF INCOME-TAX, TRIVANDRUM 4. THE COMMISSIONER OF INCOME-TAX(A), KOWDIAR, TRIV ANDRUM 695 003 5. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH