ACIT, CHENNAI V. M/s. Mother Mira Industries Ltd., CHENNAI

ITA 3193/CHNY/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6036 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-10-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 18-05-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 21-11-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M PALANICHAMY
• Assessee Lawyers: R VIJAYARAGHAVAN ADV
• Keywords: Depreciation; Rectification of order; Non-deduction of tax
• Section: 147; 148; 154

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI . , , BEFORE SHRI ABRAHAM P.GEORGE, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER ./I.T.A. NOS.3194, 3197, 3193 & 3198/MDS/2016 / ASSESSMENT YEARS : 2007-08, 2008-09 & 2010-20 11. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(2) CHENNAI. VS. M/S. MOTHER MIRA INDUSTRIES LTD, RAYALA TOWERS, 2 ND FLOOR, 158, ANNA SALAI, CHENNAI 600 002. [PAN AACCM 2392L ] ( / APPELLANT) ( /RESPONDENT) ! ' # / APPELLANT BY : SHRI. M. PALANICHAMY, JCIT. $%! ' # /RESPONDENT BY : SHRI. R. VIJAYARAGHAVAN, ADV & ' ' () /DATE OF HEARING : 12-10-2017 *+ ' () /DATE OF PRONOUNCEMENT : 13-10-2017 / O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER APPEALS IN ITA 3194/2016, 3197/2016 AND 3193/2016 ARE AGAINST AN ORDER DATED 28.08.2016 OF LD. COMMISSIO NER OF INCOME TAX (APPEALS)-18, CHENNAI FOR ASSESSMENT YEARS 2007-08 , 2008-09 AND 2010-2011. APPEAL IN ITA NO.3198/2016 IS AGAINST AN ORDER DATED ITA NO. 3193, 3194, 3197 & 3198/2016. :- 2 -: EVEN OF VERY SAME LD. COMMISSIONER OF INCOME TAX ( APPEALS) FOR ASSESSMENT YEAR 2010-2011, QUASHING A RECTIFICATION ORDER PASSED BY THE LD. ASSESSING OFFICER U/S. 154 OF THE INCOME TA X ACT, 1961 (IN SHORT THE ACT). 2. APPEALS IN ITA 3194/2016, 3197/2016 AND 3193/2016 ARE TAKEN UP FIRST FOR DISPOSAL. GROUNDS TAKEN BY THE REVENUE FOR ASSESSMENT YEAR 2007-08 IN ITA 3194/2016 ARE REPROD UCED HEREUNDER:- 1 . THE ORDER OF THE LEARNED COMMISSIONER OF INCOME T AX (APPEALS) IS ERRONEOUS ON FACTS OF THE CASE AND IN LAW. 2. THE LEARNED CIT (A) ERRED IN HOLDING THAT THE AC TION OF THE AO IN RE- OPENING THE ASSESSMENT FOR THE A .. Y 2007- 08 IS LEGALLY NOT CORRECT.. 2 .. 1 THE LD. CIT(A) IS NOT JUSTIFIED IN HOLDING T HAT THE ACTION OF THE AO IN RE- OPENING THE ASSESSMENT FOR THE A .. Y 2007-08 IS LEGALLY NOT CORRECT. 2.2. THE LD. CIT(A) ERRED IN HOLDING THAT THE A.O H AS NOT PROVED THAT THERE WAS A FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE TRULY AND FULLY ALL MATERIAL FACTS TO E NABLE HIM TO COMPLETE THE ASSESSMENT .. 2 3. THE LEARNED CIT (A) OUGHT TO HAVE APPRECIATED THAT SUCH A PRECONDITION FOR INVOKING THE PROVISO TO SEC .. 147 AND ESTABLISHING THAT THERE WAS A FAILURE ON THE PA RT OF THE ASSESSEE TO DISCLOSE TRULY AND FULLY ALL MATERIAL F ACTS NECESSARY FOR ASSESSMENT IS REQUIRED TO BE SATISFIE D BY THE AO, ONLY WHEN AN ASSESSMENT IS REOPENED BEYOND 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. 2..4 THE LEARNED CIT (A) OUGHT TO HAVE CONSIDERED T HAT THE ASSESSMENT FOR THE AY 2007-08 WAS REOPENED BY THE A .O BY ISSUING NOTICE U/S 148 OF THE IT ACT ON 23.03.20 12, WHICH IS WELL WITHIN THE PERIOD OF 4 YEARS, FROM TH E END OF ITA NO. 3193, 3194, 3197 & 3198/2016. :- 3 -: THE AY 2007-08 . 2.5. THE ID. CIT(A) OUGHT TO HAVE APPRECIATED THAT THE RE- OPENING OF ASSESSMENT MADE BY THE AO U/S .. 147 OF THE ACT FOR THE A Y 200708 IS JUSTIFIED ON THE FACTS AN D REASONS RECORDED BY HIM .. 2.6 THE LD. CIT (A) OUGHT TO HAVE APPRECIATED THAT THE REOPENING OF THE ASSESSMENT WAS NOT MADE ON A CHANG E OF OPINION BY THE ASSESSING OFFICER .. 2.7 THE LD. CIT (A) OUGHT TO HAVE APPRECIATED THAT PRIMARY FACTS NECESSARY FOR ASSESSMENT WERE NOT FULLY DISCL OSED BY THE ASSESSEE AS REGARDS THE NON- DEDUCTION OF TDS O N LEASE PAYMENTS WHICH WAS ONE OF THE REASONS FOR REOPENING OF THE ASSESSMENT .. 3. THE LD CIT(A) ERRED IN DELETING THE DISAIIOWANCE OF RS .. 2,98,53,716/- MADE BY THE AO U/S..40(A)(IA) IN T HE ASSESSMENT. 3.1 THE ID. CIT(A) IS NOT JUSTIFIED IN DELETING THE DISALLOWANCE OF RS.2,98,53,716/- MADE BY THE A.O ON THE GROUND OF NON-DEDUCTION OF TAX BY THE ASSESSEE ON T HE LEASE RENT PAID U/S.40(A)(IA)OF THE ACT. 3 2. THE ID .. CIT(A), ON THE FACTS AND CIRCUMSTANC ES OF THE CASE, OUGHT TO HAVE CONFIRMED THE DISALLOWANCE OF 2,98,53,716/- MADE BY THE AO U/S..40(A)(IA) IN THE ASSESSMENT . 4. THE ID . CIT(A) ERRED IN DELETING THE ADDITION O F RS..47,764/- MADE ON ACCOUNT OF THE DISALLOWANCE OF EXPENDITURE UNDER THE HEAD RUNNING AND OPERATION OF VEHICLES IN THE ASSESSMENT 4.1. FOR THE REASONS STATED BY THE A .. O IN PARA 6 OF THE ASST .. ORDER, THE ID CIT(A) OUGHT TO HAVE CONFIRME D THE SAID ADDITION OF RS..47,764/- MADE IN THE ASSESSMEN T 5. FOR THIS GROUNDS AND FOR ANY OTHER GROUNDS INCLU DING AMENDMENT THAT MAY BE RAISED DURING THE COURSE OF T HE APPEAL PROCEEDINGS, THE ORDER OF LEARNED CIT (APPEA LS) MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED ITA NO. 3193, 3194, 3197 & 3198/2016. :- 4 -: 3. GROUNDS 1 & 5 ARE GENERAL IN NATURE NEEDING NO SPEC IFIC ADJUDICATION. 4. IN SUPPORT OF ITS GROUND 2, LD. COUNSEL FOR THE REV ENUE SUBMITTED THAT LD. COMMISSIONER OF INCOME TAX (APPE ALS) FELL IN ERROR IN HOLDING THE REOPENING AS INVALID. AS PER LD. DEPARTMENTAL REPRESENTATIVE REOPENING WAS DONE WITHIN A PERIOD O F FOUR YEARS FROM THE END OF THE IMPUGNED ASSESSMENT YEAR AND THE REA SONS RECORDED BY THE LD. ASSESSING OFFICER JUSTIFIED SUCH REOPENI NG. 5. LD. AUTHORISED REPRESENTATIVE FAIRLY ADMITTED THAT REOPENING DONE FOR ASSESSMENT YEARS 2007-08 AND 2008-09 WERE VALID AND CONCEDED THE GROUND BY THE REVENUE. ACCORDINGLY, G ROUND NO.2 OF THE REVENUE STANDS ALLOWED. 6. VIDE ITS GROUND NO.3, GRIEVANCE RAISED BY THE REVEN UE IS THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DELET ED A DISALLOWANCE OF RS.2,98,53,716/- MADE BY THE LD. ASSESSING OFFIC ER RELYING ON SECTION 40(A)(IA) OF THE INCOME TAX ACT, 1961 (IN S HORT THE ACT). 7. LD. COUNSEL FOR THE REVENUE SUBMITTED THAT ASSESSEE HAD PAID LEASE RENTAL TO M/S.MOHAN BREWERIES AND DISTIL LERIES LIMITED, (IN ITA NO. 3193, 3194, 3197 & 3198/2016. :- 5 -: SHORT THE MBDL) ON WHICH NO TAX WAS DEDUCTED A T SOURCE. LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT LD. COMM ISSIONER OF INCOME TAX (APPEALS) HAD ALLOWED THE CLAIM ON ASSES SEES APPEAL, RELYING ON THE SPECIAL BENCH DECISION IN THE CASE O F MERILYN SHIPPING & TRANSPORTS VS. ACIT, (2012) 136 ITD 23. AS PER THE LD. DEPARTMENTAL REPRESENTATIVE, LD. COMMISSIONER OF INCOME TAX (APP EALS) HELD THAT DISALLOWANCE U/S. 40(A)(IA) OF THE ACT COULD BE DON E ONLY ON AMOUNTS SHOWN AS PAYABLE AND NOT AS PAID. AS PER THE LD. D EPARTMENTAL REPRESENTATIVE BY VIRTUE OF JUDGMENT OF HONBLE A PEX COURT IN THE CASE OF PALAM GAS SERVICE VS CIT, 394 ITR 300 THE VIEW TAKEN BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS) WAS NOT CO RRECT. ACCORDING TO HIM SEC.40(A)(IA) OF THE ACT APPLIED BOTH TO PA YABLE AS WELL AS PAID AMOUNTS IF TAX WAS NOT DEDUCTED AT SOURCE. 8. PER CONTRA, LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAD DECIDED TH E ISSUE RELYING ON THE DECISION OF THE TRIBUNAL IN THE CASE OF EDEN EXPORTS CO. VS. ACIT (ITA NO.2121/MDS/2015, DATED 30.12.2015) WHICH HAD FOLLOWED THE DECISION OF SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF MERILYN SHIPPING & TRANSPORTS (SUPRA). ACCORDING TO HIM, ASSESSEE HAD RAISED ONE OTHER GROUND BEFORE THE LD. COMMISSIONER OF IN COME TAX (APPEALS) THAT M/S. MBDL HAD TAKEN INTO ACCOUNT T HE LEASE RENTAL ITA NO. 3193, 3194, 3197 & 3198/2016. :- 6 -: PAID BY THE ASSESSEE TO THEM WHILE COMPUTING THEIR INCOME FOR THE IMPUGNED ASSESSMENT YEAR AND HAD ALSO FILED A RETU RN OF INCOME AFTER PAYING DUE TAXES. ACCORDING TO HIM, BY VIRTUE OF J UDGMENT OF HONBLE APEX COURT IN THE CASE HINDUSTAN COCO COLA BEVERAGE (P) LTD VS. CIT, 293 ITR 226 , ONCE THE PAYEE HAD SHOWN RECEIPTS AS A PART OF IT S INCOME AND PAID TAXES, ASSESSEE COULD NOT BE CONSID ERED AS ONE IN DEFAULT. LD. COUNSEL ALSO PLACED RELIANCE ON A CO- ORDINATE BENCH DECISION IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009-2010 IN ITA NO.2135/MDS/2013, DATED 28.10.2016. ACCORDING TO HI M, VERY SAME ISSUE REGARDING DISALLOWANCE U/S. 40(A)(IA) OF THE ACT ON PAYMENTS MADE TO M/S. MBDL, HAD COME UP BEFORE THE CO-ORDINA TE BENCH. AS PER THE LD. AUTHORISED REPRESENTATIVE, THE CO-ORDIN ATE BENCH HAD, AFTER CONSIDERING THE JUDGMENT OF HONBLE DELHI HI GH COURT IN THE CASE OF CIT VS. ANSAL LAND MARK TOWNSHIP (P) LTD (2015) 377 ITR 635 REMITTED THE MATTER BACK TO THE LD. ASSESSING OFFICER FOR FIND ING OUT WHETHER THE LEASE RENTALS WERE CONSIDERED BY M/S. M BDL, WHILE COMPUTING THEIR INCOME FOR THE IMPUGNED ASSESSMENT YEAR AND WHETHER TAXES WERE ACTUALLY PAID BY THE CONCERNED P ARTY. ACCORDING TO HIM, IF ASSESSEE WAS ABLE TO SHOW THAT M/S. MBDL HAD PAID TAXES ON LEASE RENTALS AND TAKEN IT INTO ACCOUNT FOR COM PUTING THEIR INCOME, THEN DISALLOWANCE U/S. 40(A)(IA) OF THE ACT COULD NOT BE MADE IN THE HANDS OF THE ASSESSEE. ITA NO. 3193, 3194, 3197 & 3198/2016. :- 7 -: 9. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUS ED THE ORDERS OF THE AUTHORITIES BELOW. LD. COMMISSIONER O F INCOME TAX (APPEALS) HAD DELETED THE DISALLOWANCE MADE BY THE LD. ASSESSING OFFICER U/S. 40(A)(IA) OF THE ACT FOR LEASE RENTALS PAID BY THE ASSESSEE TO M/S. MBDL ON A FINDING THAT THEY WERE PAID AMOUN T AND NOT PAYABLE AMOUNT. BY VIRTUE OF JUDGMENT OF HONBLE APEX COUR T IN THE CASE OF PALAM GAS SERVICE (SUPRA ) SECTION 40(A)(IA) OF THE ACT WILL BE ATTRACTED WHETHER THE AMOUNTS ARE PAID OR SHOWN AS PAYABLE. OTHER DECISIONS TO THE CONTRARY ARE THEREFORE NO MORE GOO D LAW. NEVERTHELESS, CO-ORDINATE IN ASSESSEES OWN CASE H AD HELD THAT IF M/S. MBDL HAD CONSIDERED THE LEASE RENTALS WHILE COMPUTING THEIR INCOME AND HAD PAID TAX THEREON, THEN ASSESSEE CO ULD NOT BE BURDENED WITH THE RIGOURS OF SECTION 40(A)(IA) OF T HE ACT. OBSERVATION OF THE TRIBUNAL AS APPEARING IN PARAGRAPHS 3 & 4 IN ITA NO.2135/MDS/2013, DATED 28.10.2016 ARE REPRODUCED H EREUNDER: 3. SH. R. VIJAYARAGHAVAN, THE LD. COUNSEL FOR TH E ASSESSEE, SUBMITTED THAT THE ASSESSEE HAS PAID A SU M OF `3,40,68,670/- TOWARDS LEASE RENT TO M/S MOHAN BREW ERIES AND DISTILLERIES LIMITED. IN FACT, THE ASSESSEE TOOK V EHICLES ON LEASE AND PAID THE LEASE RENTAL. HOWEVER, NO TAX WAS DED UCTED. REFERRING TO THE CERTIFICATE ISSUED BY M/S MOHAN BR EWERIES AND DISTILLERIES LIMITED ON 03.02.2015, THE LD. COUNSEL SUBMITTED THAT M/S MOHAN BREWERIES AND DISTILLERIES LIMITED H AS ACCOUNTED THE LEASE RENTAL TO THE EXTENT OF `2,40,6 7,200/-, THEREFORE, IN RESPECT OF LEASE RENTAL ACCOUNTED BY M/S MOHAN BREWERIES AND DISTILLERIES LIMITED CANNOT BE ASSESS ED IN THE HANDS OF THE ASSESSEE. THE LD. COUNSEL PLACED HIS RELIANCE ON THE JUDGEMENT OF DELHI HIGH COURT IN CIT V. ANSAL L AND MARK TOWNSHIP (P) LTD. (20150 93 CCH 214 AND SUBMITTED T HAT SECOND PROVISO TO SECTION 40(A)(IA) OF THE ACT WAS RETROSPECTIVE ITA NO. 3193, 3194, 3197 & 3198/2016. :- 8 -: IN OPERATION, THEREFORE, WHEN THE RECIPIENT HAS PAI D THE TAXES, THERE CANNOT BE ANY DISALLOWANCE IN THE HANDS OF TH E ASSESSEE. 4. WE HAVE HEARD SHRIDURAI PANDIAN, THE LD. DEPARTMENTAL REPRESENTATIVE, ALSO. ADMITTEDLY, THE ASSESSEE HAS PAID A SUM OF `3,01,08,357/- TOWARDS LEASE RENT AL TO M/S MOHAN BREWERIES AND DISTILLERIES LIMITED. ADMITTED LY, NO TAX WAS DEDUCTED. NOW THE ASSESSEE FILED A COPY OF CER TIFICATE SAID TO BE ISSUED BY M/S MOHAN BREWERIES AND DISTILLERIE S LIMITED ON THE GROUND THAT THEY HAVE ACCOUNTED THE LEASE RENTA L TO THE EXTENT OF `2,40,67,200/- IN THEIR ACCOUNTS FOR THE PURPOSE OF COMPUTATION OF TAX LIABILITY. IN VIEW OF THE JUDGE MENT OF DELHI HIGH COURT IN ANSAL LAND MARK TOWNSHIP (P) LTD. (SU PRA), THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHEN THE RECIPIENT HAS PAID THE TAXES ON THE AMOUNT RECEIVED FROM THE ASSE SSEE, THERE MAY NOT BE ANY DISALLOWANCE IN THE HANDS OF THE ASS ESSEE. HOWEVER, WHEN THE ASSESSEE CLAIMS THAT A SUM OF `3,01,08,357/- WAS PAID TOWARDS LEASE RENTAL, WHAT WAS CERTIFIED BY M/S MOHAN BREWERIES AND DISTILLERIES LIMITED IS ONLY TO THE EXTENT OF `2,40,67,200/-. THEREFORE, IT HAS TO BE EXAMINED WHAT HAPPENED TO THE BALANCE AMOUNT. MOREOVER, IT NEEDS TO BE VERIFIED WHETHER TAX WAS ACTUALLY PAID BY M/S MOHAN BREWERIES AND DISTILLERIES LIMITED AS CLAIMED BY THEM. SINCE BOTH THE AUTHORITIES BELOW HAVE NOT EXAMINED THIS ISSUE, THI S TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RECONSIDERED. ACCORDINGLY, THE ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE DISALLOWANCE OF `3,01,0 8,357/- IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL RE-EXAMINE THE MATTER AND F IND OUT WHETHER ANY TAX WAS PAID BY M/S MOHAN BREWERIES AND DISTILLERIES LIMITED IN RESPECT OF THE AMOUNT RECEI VED FROM THE ASSESSEE TOWARDS LEASE RENTAL AND THEREAFTER DECIDE THE ISSUE IN ACCORDANCE WITH LAW, AFTER GIVING A REASONABLE O PPORTUNITY TO THE ASSESSEE. ACCORDINGLY, FOR THE IMPUGNED ASSESSMENT YEAR ALSO, WE REMIT THE ISSUE BACK TO THE FILE OF THE LD. ASSESSING OFFICER FOR EXAMINING WHETHER THE LEASE RENTALS WERE TAKEN INTO ACCOUNT BY M/S. M BDL FOR COMPUTING THEIR INCOME AND WHETHER DUE TAXES WERE PAID. THERE AFTER LD. ITA NO. 3193, 3194, 3197 & 3198/2016. :- 9 -: ASSESSING OFFICER HAS TO DECIDE THE ISSUE IN ACCOR DANCE WITH LAW. GROUND 3 OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSE. 10. VIDE ITS GROUND 4, GRIEVANCE OF THE REVENUE IS THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) DELETED AN ADD ITION OF E47,764/- MADE BY THE LD. ASSESSING OFFICER ON EXP ENDITURE CLAIMED UNDER THE HEAD RUNNING AND OPERATION OF VEHICLES . 11. WHAT WE FIND IS THAT THIS GROUND IS ILL-CONCEIVED S INCE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAD AT PARA 7. 2 ORDER DISMISSED THE RELEVANT GROUND RAISED BY THE ASSESSE E. GROUND NO.4 OF THE REVENUE THEREFORE STANDS DISMISSED. 12. NOW, WE TAKE UP APPEAL OF THE REVENUE FOR ASSESSMEN T YEAR 2008-09 IN ITA NO.3197/MDS/2016. 13. GROUNDS 1 & 5 ARE GENERAL IN NATURE NEEDING NO SPE CIFIC ADJUDICATION. 14. GROUND NUMBER 2 RAISED BY THE REVENUE IS SIMILAR T O ITS GROUND NO.2 FOR ASSESSMENT YEAR 2007-2008 IN ITA NO.3194/MDS/2016. WE HAD ALREADY HELD AT PARA 5 ABO VE THAT REOPENING DONE WAS VALID, SINCE LD. AUTHORISED REPR ESENTATIVE OF THE ITA NO. 3193, 3194, 3197 & 3198/2016. :- 10 -: ASSESSEE CONCEDED THE RELATED GROUND RAISED BY THE REVENUE. ACCORDINGLY, GROUND NO.2 OF THE REVENUE STANDS ALLO WED. 15. VIDE ITS GROUND 3, GRIEVANCE OF THE REVENUE IS THA T LD. COMMISSIONER OF INCOME TAX (APPEALS) DELETED AN ADD ITION OF E.18,86,634/- MADE BY THE LD. ASSESSING OFFICER. 16. WHAT WE FIND IS THAT LD. COMMISSIONER OF INCOME TAX (APPEALS) HAD DISMISSED THE GROUND RAISED BY THE AS SESSEE ASSAILING THE DISALLOWANCE UNDER THE HEAD RUNNING AND OPE RATION OF VEHICLES. THIS IS SPECIFICALLY MENTIONED BY LD. C OMMISSIONER OF INCOME TAX (APPEALS) AT PARA 7.2 OF HIS ORDER. ACCO RDINGLY, GROUND NO.3 OF THE REVENUE SEEMS TO BE ILL-CONCEIVED. SAID GROUND IS DISMISSED. 17. VIDE ITS GROUND NO.4, GRIEVANCE RAISED BY THE REVE NUE IS ON THE DELETION OF AN ADDITION OF E12,92,020/- MADE BY THE LD. ASSESSING OFFICER, FOR EXCESS DEPRECIATION ON COMMERCIAL VEH ICLES. 18. WHAT WE FIND FROM THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) IS THAT LD. COMMISSIONER OF IN COME TAX (APPEALS) HAD NOT DELETED THE DISALLOWANCE MADE FOR EXCESS DEPRECIATION ON COMMERCIAL VEHICLES. AT PARA 7.2 O F ITS ORDER, LD. ITA NO. 3193, 3194, 3197 & 3198/2016. :- 11 -: COMMISSIONER OF INCOME TAX (APPEALS) HAD DISMISSED ALL THE GROUNDS ON MERITS, RAISED BY THE ASSESSEE HAVING HELD THA T REASSESSMENTS WAS INVALID. IN OUR OPINION, LD. COMMISSIONER OF I NCOME TAX (APPEALS) HAVING NOT DELETED THE DISALLOWANCE OF EXCESS DEPRE CIATION, THE GROUND IN THIS REGARD RAISED BY THE REVENUE IS ILL-CONCEIV ED. SUCH GROUND DOES NOT ARISE FROM THE ORDER IN APPEAL. GROUND NO. 4 OF THE REVENUE IS DISMISSED. 19. NOW, WE TAKE UP APPEAL OF THE REVENUE FOR ASSESSME NT YEAR 2010-2011 IN ITA NO.3193/MDS/2016. 20. ONLY EFFECTIVE GROUND RAISED BY THE REVENUE IN THI S APPEAL IS GROUND 2 AND IT ASSAILS THE DELETION OF A DISALLOWA NCE MADE BY THE LD. ASSESSING OFFICER U/S. 40(A)(IA) OF THE ACT. 21. FACT SITUATION WITH REGARD TO THE ABOVE DISALLOWANC E IS VERY SIMILAR TO THE DISALLOWANCE MADE FOR ASSESSMENT Y EARS 2007-08 UNDER THE VERY SAME SECTION. DISALLOWANCE WAS ON LEASE R ENTALS PAID BY THE ASSESSEE TO M/S. MBDL. WE HAVE ALREADY HELD AT PARA 9 ABOVE, THAT THE ISSUE REQUIRES A FRESH LOOK BY THE LD. ASSESSIN G OFFICER, FOR VERIFYING WHETHER PAYEE HAD ACCOUNTED FOR THE LEASE RENTAL AN D PAID TAXES. SIMILAR DIRECTIONS ARE GIVEN HERE ALSO. GROUND NUM BER 2 IS ALLOWED FOR STATISTICAL PURPOSE. ITA NO. 3193, 3194, 3197 & 3198/2016. :- 12 -: 22. NOW, WE TAKE UP THE APPEAL OF THE REVENUE IN ITA NO.3198/MDS/2016, FOR ASSESSMENT YEAR 2010-2011. 23. IN THIS APPEAL, THE REVENUE IS AGGRIEVED ON LD. COM MISSIONER OF INCOME TAX (APPEALS) HOLDING AN ORDER PASSED BY LD. ASSESSING OFFICER U/S. 154 OF THE ACT AS NOT VALID. 24. LD. ASSESSING OFFICER HAD INVOKED SECTION 154 OF TH E ACT FOR CORRECTING THE WDV ADOPTED FOR THE IMPUGNED ASSESSM ENT YEAR, WHILE WORKING OUT THE DEPRECIATION. AS PER THE LD. ASSES SING OFFICER REWORKING OF THE DEPRECIATION ON COMMERCIAL VEHIC LES FOR ASSESSMENT YEARS 2008-09 AND 2009-2010 RENDERED THE WDV DIFFER ENT FROM WHAT WAS CONSIDERED IN THE ASSESSMENT. 25. LD. COMMISSIONER OF INCOME TAX (APPEALS) ON ASSESS EES APPEAL HELD THAT DISALLOWANCE MADE BY THE LD. ASSES SING OFFICER U/S. 154 OF THE ACT WAS A HIGHLY DEBATABLE ONE AND QUAS HED THE RECTIFICATION ORDER. 26. WE ARE OF THE CONSIDERED OPINION THAT THIS ISSUE RE QUIRES A FRESH LOOK BY THE LD. ASSESSING OFFICER, SINCE HE H AS TO CONSIDER THE EFFECT OF APPELLATE DECISIONS IF ANY, FOR ASSESSME NT YEARS 2008-09 AND 2009-2010 WITH RESPECT TO ASSESSEES CLAIM OF DEPR ECIATION ON COMMERCIAL VEHICLES. SINCE WE HAVE ALREADY REMITTE D THE ISSUE ITA NO. 3193, 3194, 3197 & 3198/2016. :- 13 -: REGARDING DISALLOWANCE UNDER SEC. 40(A)(IA) OF THE ACT FOR THE IMPUGNED ASSESSMENT YEAR BACK TO THE FILE OF THE LD . ASSESSING OFFICER, WE ARE OF THE OPINION THAT THE ISSUE REGARDING OPEN ING WDV ON COMMERCIAL VEHICLES CAN ALSO BE VERIFIED AFRESH A LONGWITH THAT. ACCORDINGLY, WE REMIT THE ISSUE BACK TO THE FILE OF THE LD. ASSESSING OFFICER FOR CONSIDERATION AFRESH IN ACCORDANCE WIT H LAW. 27. TO SUMMARIZE THE RESULTS, THE APPEALS OF THE REVEN UE IN ITA NOS.3194/2016 AND 3197/2016 FOR ASSESSMENT YEA RS 2007-08 AND 2008-09 ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES . THE APPEALS OF THE REVENUE IN ITA NOS. 3193/2016 AND 3198/2016 FOR ASS ESSMENT YEAR 2010-2011 ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON FRIDAY, THE 13 TH DAY OF OCTOBER, 2017, AT CHENNAI. SD/- SD/- ( ) (GEORGE MATHAN) /JUDICIAL MEMBER ( . ! ' ) (ABRAHAM P. GEORGE) $ %& / ACCOUNTANT MEMBER - ' / CHENNAI . / DATED:13TH OCTOBER, 2017 KV / ' $(0 1 2 1 ( / COPY TO: 1 . ! / APPELLANT 3. & 3( ( ) / CIT(A) 5. 167 $(8 / DR 2. $%! / RESPONDENT 4. & 3( / CIT 6. 79 :' / GF