ITO, New Delhi V. M/s International Cars and Motors Ltd., Delhi

ITA 3326/DEL/2015

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6159 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 7 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-01-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2006-2007
• Appeal Filed On: 25-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NAINA SOIN KAPILA
• Assessee Lawyers: SUMIT KUMAR BANSAL
• Keywords: Depreciation; Additional depreciation; Question of law
• Section: 271(1)(c); 32(1)(iia); 32; 27

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: BENCH D, NEW DELHI BEFORE SMT. BEENA A PILLAI, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 3326/DEL/2015 AY: 2006-07 ITO WARD 12(3), ROOM NO. 420B, C.R. BUILDING, I.P. ESTATE, NEW DELHI. VS . INTERNATIONAL CARS & MOTORS LTD., SONALIKA HOUSE, 283, ACGR ENCLAVE, KARKARDOOMA, DELHI. AABC12403D (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. NAINA SOIN KAPILA, SR. DR RESPONDENT BY : SH. SUMIT KUMAR BANSAL, CA DATE OF HEARING : 22/01/2019 DATE OF PRONOUNCEMENT : 24/01/2019 ORDER PER BEENA A PILLAI, JUDICIAL MEMBER PRESENT PENALTY APPEAL HAS BEEN FILED BY REVENUE AG AINST ORDER DATED 13/03/15, PASSED BY LD.CIT (A)-4, NEW DELHI FOR ASS ESSMENT YEAR 2006- 07 ON FOLLOWING GROUNDS OF APPEAL: 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING PENALTY IMPOSE D U/S 271(1)(C) FOR RS. 61,51,765/-. 2. THE APPELLANT CRAVES LEAVE, TO ADD, ALTER OR AMEND ANY GROUND OF APPEAL RAISED ABOVE AT THE TIME OF HEARING. BRIEF FACTS OF THE CASE ARE AS UNDER 2. ASSESSEE IS A COMPANY ENGAGED IN MANUFACTURING A ND ASSEMBLY OF MULTI-UTILITY VEHICLES. LD.AO DURING ASSESSMENT PRO CEEDINGS OBSERVED THAT ASSESSEE CLAIMED ADDITIONAL DEPRECIATION UNDER SECTION 32(1)(IIA) ON ITA NO. 3326/DEL/2015 2 FIXED ASSETS UNDER THE HEAD PLANT AND MACHINERY AMO UNTING TO RS.27,12,71,521/-. IN THE ASSESSMENT ORDER LD.AO DI D NOT ALLOW CLAIM OF ADDITIONAL DEPRECIATION AMOUNTING TO RS.1,82,76,190 /-. 3. AGGRIEVED BY ADDITION MADE BY LD. AO, ASSESSEE P REFERRED APPEAL BEFORE LD. CIT (A) WHO CONFIRMED THE ADDITION IT IS OBSERVED THAT AGAINST ORDER OF LD. CIT(A) ASSESSEE PREFERRED APPEAL BEFOR E THIS TRIBUNAL, WHO UPHELD ORDER OF LD. AO VIDE ORDER DATED 21/12/12. 4. LD. AO THEREAFTER ISSUED NOTICE UNDER SECTION 27 4, FOR LEVY OF PENALTY UNDER SECTION 271 (1) (C) OF THE ACT. ASSES SEE IN THE MEANWHILE, PREFERRED APPEAL BEFORE HONBLE DELHI HIGH COURT, AGAINST TRIBUNALS ORDER ON 21/12/12 AND HONBLE DELHI HIGH COURT ADMITTED THE APPEAL. 5. AGAINST THE PENALTY ORDER PASSED BY LD.AO ASSESS EE PREFERRED APPEAL BEFORE LD.CIT (A). LD.CIT (A) DELETED PENALT Y BY FOLLOWING DECISION OF HONBLE DELHI HIGH COURT IN CASE OF CIT VS RAUL MEHTA IN ITA NO. 523/11 AND CIT VS. LIQUID INVESTMENTS LTD IN ITA NO. 240/2009 VIDE ORDER DATED 05/10/10 . 6. AGGRIEVED BY ORDER OF LD.CIT (A), REVENUE IS IN APPEAL BEFORE US NOW. 7. LD.COUNSEL AT THE OUTSET SUBMITTED THAT HONBLE DELHI HIGH COURT IN ITA NO. 598/2014 ADMITTED QUESTION OF LAW IN RESPECT OF ADDITION, O N WHICH PENALTY HAS BEEN CONFIRMED BY LD.CIT(A). HE BROUGHT TO OUR NOTICE QUESTION OF LAW THAT HAS BEEN FRAMED BY HONBLE HIGH COU RT WHICH HAS BEEN REPRODUCED BY LD.CIT (A) IN PARA 5.2 AS UN DER: 1. WHETHER THE INCOME TAX APPELLATE TRIBUNAL WAS RIGH T IN HOLDING THAT THE ASSESSEE IS NOT ENTITLED TO ADDITIONAL DEPRECIA TION OF @ 15% OR 20% UNDER SECTION 32 (1) (IIA) OF THE INCOME TAX AC T, 1961 AS IT EXISTED PRIOR TO 31/03/06 OR AFTER 01/04/06 BECAUSE THE MAC HINERY WAS ITA NO. 3326/DEL/2015 3 ACQUIRED BEFORE 31 ST OF MARCH, 2006 BUT WAS INSTALLED AFTER 01/04/06?. 8. LD.COUNSEL PLACED RELIANCE ON ORDER DATED 05/10/10 PASSED BY HONBLE DELHI HIGH COURT IN CASE OF CIT VS LIQUID INVESTMENT AND TRADING CO., IN ITA NO. 240/2009, AND SUBMITTED THAT, ADMISSION OF ISSUE ON WHICH PENALTY HAS BEEN LEVIED WOULD MAKE IT APPAREN T THAT, SUCH ADDITION MADE IS DEBATABLE. 9. ON CONTRARY, LD.DR PLACE RELIANCE ON ORDERS OF A UTHORITIES BELOW. 10. WE HAVE PERUSED SUBMISSIONS ADVANCED BY BOTH SI DES IN LIGHT OF RECORDS PLACED BEFORE US. 10.1 IT IS A CASE WHERE PENALTY IS LEVIED, ON A ISS UE, IN RESPECT OF WHICH HONBLE DELHI HIGH COURT IN ASSESSEES OWN CASE FOR RELEVANT ASSESSMENT YEAR UNDER CONSIDERATION, HAS FRAMED SUBSTANTIAL QU ESTION OF LAW. IT THUS BECOMES APPARENT THAT ADDITION IS DEBATABLE. 11. WE DRAW SUPPORT IN RESPECT OF AFORESTATED VIEW FROM ORDER DATED 05/10/10 PASSED BY HONBLE DELHI HIGH COURT IN CASE OF CIT VS LIQUID INVESTMENT AND TRADING CO., (SUPRA) . 12. WE ARE, THEREFORE, INCLINED TO DELETE THE PENAL TY. ACCORDINGLY GROUNDS RAISED BY REVENUE STANDS DISMIS SED. IN THE RESULT APPEAL FILED BY REVENUE STANDS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/01/2019 SD/- SD/- (PRASHANT MAHARISHI) (B EENA A PILLAI) ACCOUNTANT MEMBER JUDIC IAL MEMBER DATED: 24.01.2019 *KAVITA ARORA COPY FORWARDED TO: ITA NO. 3326/DEL/2015 4 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT TRUE COPY ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 22 .01.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 23 .01.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P S/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 2 4 / 0 1 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 2 4 / 0 1 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT 2 4 / 0 1 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 2 4 / 0 1 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER