The Citizen Co-operative Bank Limited, Vasco V. Assistant Commissioner of Income Tax Circle - 2(1), , Panaji

ITA 300/PAN/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3909 (ITAT-PANAJI)
• Duration Of Justice: 1 year(s) 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 17-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y V RAVIRAJ
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE S HRI SHAMIM YAHYA (AM) AND SHRI RAM LAL NEGI (JM) ITA NO. 300 /PAN /2017 ASSESSMENT Y EAR: 2012 - 13 THE CITIZEN CO. OP. BANK LTD., LAKSHDEEP APARTMENTS, NEAR DAMODAR TEMPLE, VASCO - DA - GAMA, GOA - 403802 PAN: AACAT1914B VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE - 2(1), FIRST FLOOR, AAYAKAR BHAVAN, PLOT NO. 5, EDC COMPLEX, PATTO PLAZA, PANAJI, GOA (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI TANZIL PADVEKAR (ADVOCATE) REVE NUE BY : SHRI Y.V. RAVIRAJ (DR) DATE OF HEARING: 13 / 11 /201 8 DATE OF PRONOUNCEMENT: 31 / 01 /201 9 O R D E R PER RAM LAL NEGI, JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER DATED 21.09.2017 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 1 (FOR SHORT THE CIT(A) , PANAJI , PERTAINING TO THE ASSESSMENT YEAR 2012 - 13 , WHEREBY THE LD. CIT(A) HAS DISMISSED THE APPEAL FILED BY THE ASSESSEE AGAINST THE ASSESSMENT ORDER PASSED U/S 143 (3) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT). 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IN ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION HAD CLAIMED DEPRECIATION ON UPS @ 60% WHICH WORKS OUT TO RS. 3,13,675/ - . ACCO RDINGLY, THE ASSESSEE WAS ASKED TO EXPLAIN AS TO WHY THE DEPRECIATION SHOULD NOT BE RESTRICTED TO 15%. THE ASSESSEE CONTENDED THAT UPS IS AN INTEGRAL PART OF THE COMPUTER SYSTEM, THEREFORE, DEPRECIATION OF 60% IS APPLICABLE IN THE CASE OF UPS ALSO. HOWEVER , 2 ITA NO. 300 / PAN /2017 ASSESSMENT YEAR: 2012 - 13 THE AO REJECTED THE CONTENTION OF THE ASSESSEE AND RESTRICTED THE ADDITION TO 15%. IN THE FIRST APPEAL, THE LD.CIT (A) CONFIRMED THE ACTION OF THE AO. AGAINST THE SAID ORDER, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 3 . T HE ASSESSEE HAS CHALLENGED THE IMPUGNED ORDER PASSED BY THE LD. CIT (A) O N THE FOLLOWING EFFECTIVE GROUND : - THAT BASED ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN NOT ALLOWING THE DEPRECIATION ON UPS AT 60% BY RES TRICTING IT TO 15%. THE DEPRECIATION HAS TO BE ALLOWED AT 60%. 4. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISSUE INVOLVED IN T HE PRESENT APPEAL IS COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE DELHI TRIBUNAL IN THE CASE OF ACIT, NEW DELHI VS. M/S CAPARO ENGINEERING INDIA PVT. LTD., ITA NO. 6838/DEL/2014 FOR THE A.Y. 2007 - 08. THEREFORE, THE ASSESSEE IN THE PRESENT CASE IS ALSO ENTITLED TO CLAIM DEPRECIATION @ 60% ON THE UPS. 5. ON THE OTHER HAND, THE LD . DEPARTMENTAL REPR ESENTATIVE (DR) RELIED ON THE CONCURRENT FINDINGS OF THE AUTHORITIES BELOW. 6. WE HAVE PERUSED THE MATERIAL IN THE LIGHT OF THE RIVAL SUBMISSIONS INCLUDING THE DECISION OF THE DELHI BENCH OF THE TRIBUNAL RELIED UPON BY THE ASSESSEE. WE NOTICE THAT THE DE LHI BENCH OF THE TRIBUNAL IN THE CASE OF AICT VS. M/S CAPARO ENGINEERING INDIA PVT. LTD. (SUPRA) HAS DECIDED THE IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEE. THE RELEVANT PARAS OF THE SAID ORDER READ AS UNDER: - 15. LASTLY, WITH REGARD TO THE DISALLOWANCE O F CLAIM OF DEPRECIATION @ 60% ON UPS, THE ASSESSING OFFICER HAS ALLOWED 15% INSTEAD OF 60% CLAIMED BY THE ASSESSEE ON THE GROUND THAT UPS IS NOT PART OF COMPUTER AND THEREBY MADE THE ADDITION OF RS. 2,21,895/ - . THE ASSESSEE HAD PURCHASED UPS FOR RS. 4,93 ,1 10/ - AND HAD CLAIMED DEPRECIATION THEREON @ 60% FOR RS. 2,95,860/ - . THE ASSESSING OFFICER OBSERVED THAT DEPRECIATION MENTIONED IN APPENDIX - I RULE 5 OF IT RULES APPLIES ONLY TO COMPUTER AND 3 ITA NO. 300 / PAN /2017 ASSESSMENT YEAR: 2012 - 13 COMPUTERS SOFTWARE, WHICH ALONE ARE ENTITLED FOR DEPRECIATION @ 60 % AND SAME RATE CANNOT BE APPLIED FOR UPS. 16. THE LD. CIT (A) HAS DELETED THE ADDITION, FOLLOWING THE JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. BSES RAJDHANI POWERS LTD. IN ITA NO. 1266/2010, WHEREIN COMPUTER ACCESSORIES/PERIPHERALS LIK E PRINTERS, SCANNERS, SERVER, UPS, ETC., HAVE BEEN HELD TO BE INTEGRAL PART OF COMPUTER SYSTEM, AND THEREFORE, ENTITLED TO DEPRECIATION @ 60%. ACCORDINGLY, THE LD. CIT (A) FOLLOWING THE JUDGMENT OF HONBLE DELHI HIGH COURT AND OTHER DECISIONS OF THE TRIBU NAL ALLOWED THE ASSESSEES CLAIM @ 60%. 17. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT (A) AS THE ISSUE, WHETHER COMPUTER ACCESSORIES/PERIPHERALS LIKE PRINTERS, SCANNERS, SERVER, UPS ETC, THE RATE OF DEPRECIATION ALLOWABLE IS @ 60% AS HELD B Y THE HONBLE JURISDICTIONAL HIGH COURT AND CATENA OF OTHER JUDGMENTS. THUS, GROUND NO. 3 RAISED BY THE REVENUE IS DISMISSED. 7. SINCE, THE DELHI BENCH OF THE ITAT HAS DECIDED THE IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEE IN ACIT VS. M/S CAPARO ENGINEERI NG INDIA PVT. LTD. (SUPRA) AND SINCE NO DECISION WAS BROUGHT OUR NOTICE BY THE REVENUE CONTRARY TO THE DECISION OF THE ITAT AFORESAID, WE RESPECTFULLY FOLLOWING THE SAID DECISION ALLOW THE SOLE GROUND OF APPEAL OF THE ASSESSEE AND DIRECT THE AO TO ALLOW TH E DEPRECIATION ON THE UPS @ 60%. IN THE RESULT, APPEAL FILED BY THE ASSESSEE FOR ASSESSMENT YEAR 2012 - 2013 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST JANUARY , 2019 . SD/ - SD/ - ( SHAMIM YAHYA ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER PANAJI ; DATED: 31 / 01 / 201 9 ALINDRA, PS 4 ITA NO. 300 / PAN /2017 ASSESSMENT YEAR: 2012 - 13 / CO PY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , PANAJI / DR, ITAT, PANAJI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) / PS , PANAJI / ITAT, PAN AJI