DB International Stock Brokers Ltd., New Delhi V. DCIT, New Delhi

ITA 3238/DEL/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66002 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 09-05-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 25-06-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ANIMA BARNWAL
• Assessee Lawyers: SEKHON
• Keywords: Depreciation

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B, NEW DELHI BEFORE SHRI L.P. SAHU, ACCOUNTANT MEMBER & MS. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA NO. 3238/DEL/2012 ASSESSMENT YEAR: 2008-09 M/S DB INTERNATIONAL STOCK BROKERS LTD., VS. DCIT 402, NEW DELHI HOUSE, CIRCLE 10(1), 27, BARAKHAMBA ROAD, NEW DELHI. CONNAUGHT PLACE, NEW DELHI. AAACD0852G (APPELLANT) (RESPONDENT) ASSESSEE BY: SH. M.S. SEKHON, CA REVENUE BY: MS. ANIMA BARNWAL, SR. DR ORDER PER L.P. SAHU, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST T HE ORDER OF THE CIT(A)-XVI, NEW DELHI, VIDE ORDER DATED 23/02/2012 FOR THE A.Y. 2008- 09 ON THE FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LD. CIT(APPEALS)-XVI, DELHI HAS ERRED IN CONFIRMING THE ASSESSED INCOME OF RS. 9,39,54,331/- BY THE ASS ESSING OFFICER AS AGAINST THE RETURNED INCOME OF RS. 9,37, 22,110/-. 2. THAT THE LD. CIT(APPEALS) HAS ERRED IN CONFIRMIN G THE ADDITION OF RS. 2,28,604/- OUT OF DEPRECIATION. 3. THAT THE ORDER OF THE CIT(APPEALS) IS BAD IN LAW AND ON THE FACTS OF THE CASE; AND 4. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, A MEND OR WITHDRAW ANY OF THE GROUNDS OF APPEAL AT ANY TIME B EFORE OR AT THE TIME OF HEARING OF THE APPEAL. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAD FILED RETURN OF INCOME DECLARING THE TOTAL INCOME OF RS. 9,37,22,11 0/- FILED ON 26 TH SEPTEMBER, 2010. THE CASE WAS PROCESSED U/S 143(1) AND IT WAS SELECTED U/S 143(2) UNDER CASS NORMS. NOTICE U/S 1 42(1) ALONG WITH 2 THE QUESTIONNAIRE WAS ISSUED WHICH WAS DULY SERVED. DURING THE COURSE OF SCRUTINY PROCEEDINGS THE LD. ASSESSING OFFICER F OUND THAT THE ASSESSEE HAS ADDED AS NEW ASSET IN COMPUTER OF RS. 543607/- AND DEPRECIATION WAS CLAIMED @ 60% OR 30% (LESS THAN 18 0 DAYS). THE ASSESSING OFFICER REQUIRED DETAILS OF THE NEW ASSET S ADDED UNDER THE COMPUTER HEAD, IN RESPONSE TO THIS THE ASSESSEE FUR NISHED THE DETAILS OF NEW ASSETS PURCHASED LIKE EICON CARD, P.D. SWITCH, CLIENT ACCESS LICENCE, ODIN DERIVATIVES, FRONT OFFICE SOFTWARE PR ODUCT, EICON CARD, IBM SERVER, MODEM PRINTERS ETC. FOR AGGREGATE AMOUN T OF RS. 543607/-. OUT OF THE ADDITION OF RS. 472407/- WAS CLAIMED @ 6 0% OF THE DEPRECIATION AND THE REST AMOUNT OF RS. 71,200/- TH E DEPRECIATION WAS CLAIMED @ 30% IT MEANS THERE WAS TOTAL DEPRECIATION WAS CLAIMED BY THE ASSESSEE WAS 304804/- (RS. 283444 + RS. 21360). ON THIS ADDITION THE LD. ASSESSING OFFICER CALCULATED DEPRECIATION @ 15% AT RS. 70,860/- AND BALANCE THE DEPRECIATION WAS ALLOWED @ 7.5% RES PECTIVELY. THEREFORE, THE TOTAL DEPRECIATION WAS ALLOWED 76200 /- (RS. 70860 + RS. 5340) UNDER THE HEAD OF PLANT & MACHINERY. THE R ATE APPLIED BY THE ASSESSING OFFICER IS 15% AND 7.5% IS APPLICABLE TO THE PLANT AND MACHINERY HEAD. 3. AGGRIEVED BY THE ASSESSEE ON THE ABOVE DEPRECIAT ION DISALLOWANCE THE ASSESSEE PREFERRED AN APPEAL BEFOR E THE FIRST APPELLATE AUTHORITY AND THE LD. FIRST APPELLATE AUTHORITY UPH ELD THE ORDER OF THE ASSESSING OFFICER. AGAINST THE ORDER OF THE LD. CI T(A) THE ASSESSEE CAME BEFORE THE TRIBUNAL. 4. THE LD. AR SUBMITTED THAT THE ASSESSING OFFICER HAS ERRONEOUSLY CLASSIFYING THE COMPUTER AND THEIR PERIPHERALS. HE HAS TREATED TO THE ABOVE COMPUTER PERIPHERALS UNDER THE HEAD PLANT AN D MACHINERY AND APPLIED THE RATE AS PROVIDED. HE FURTHER SUBMITTED THAT COMPUTER SOFTWARE MEANS ANY COMPUTER PROGRAMME RECORDED ON A NY DISE, TAPE, 3 PERFORATED MEDIA OR ANY OTHER INFORMATION STORAGE D EVICE. HE ALSO FURTHER SUBMITTED THAT THE LD. CIT(A) DID NOT CONSI DER THE ORDER OF THE SPL. BENCH OF THE INCOME TAX APPELLATE TRIBUNAL IN THE D ECISION OF DEPUTY CIT VS. DATA CRAFT INDIA LTD. HAD UPHELD THE ABOVE MENTIONED CLASSIFICATION. HE ALSO RELIED ON THE DECISION OF CIT VS. BSES YAMUNA POWERS LTD., 358 ITR 47 (2013) (DEL.). 5. THE LD. DR RELIED ON THE ORDER OF THE LOWER AUTH ORITIES AND HE VEHEMENTLY OBJECTED THAT THE LOWER AUTHORITIES HAS MADE GOOD ORDER AND DOES NOT REQUIRE ANY INTERFERENCE. 6. AFTER HEARING BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD AND RELIED ON THE CASE LAWS CITED BY THE AR. THIS CASE IS SQUARELY COVERED BY THE ABOVE CITED CASE. RESPECTF ULLY FOLLOWING THE ABOVE CITED CASE AND ABOVE ADDITIONS IN THE COMPUTE R AS PERIPHERALS IS DESERVED FOR THE APPLICABLE RATE OF 60% AND 30%. A S PER NEW APPENDIX- I EFFECTIVE FROM A.Y. 2006-07 ONWARDS RULE 5 PART A TANGIBLE ASSETS-III MACHINERY AND PLANT (V) THE RATE OF DEPRECIATION ON COMPUTERS HAS BEEN PRESCRIBED @ 60% IN WHICH COMPUTER SOFTWARE AND COM PUTER SOFTWARE MEANS ANY COMPUTER PROGRAMME RECORDED ON ANY DISE, TAPE, PERFORATED MEDIA OR ANY OTHER INFORMATION STORAGE DEVICE. THE ABOVE CASE IS COVERED AS PER THE DEFINITION OF THE COMPUTER AND C OMPUTER SOFTWARE. THEREFORE, APPELLANT IS ELIGIBLE FOR DEPRECIATION @ 60% PER YEAR ON COMPUTER & COMPUTER SOFTWARE AND THEIR PERIPHERALS. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 10.05.2016 SD/- SD/- (SUCHITRA KAMBLE) (L.P. SA HU) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 10.05.2016 *KAVITA ARORA 4 COPY TO: 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR TRUE COPY BY ORDER ASSISTANT REGISTRAR DATE 1. DRAFT DICTATED ON 09.05.2016 2. DRAFT PLACED BEFORE AUTHOR 09.05.2016 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. 5. APPROVED DRAFT COMES TO THE SR.PS/PS 10.05.2016 6. KEPT FOR PRONOUNCEMENT ON 10.05.2016 7. FILE SENT TO THE BENCH CLERK 10.05.2016 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.