V.Pandarinathan, Salem V. ITO, Salem

ITA 337/CHNY/2015

• Counselvise Citation: 33721714 RSA 2015
• Duration Of Justice: 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 09-02-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Assessee Lawyers: T S LAKSHMIVENKATARAMAN
• Keywords: Depreciation; Business expenditure; Non-deduction of tax
• Section: 28; 154; 14A; 37(1)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . . . , . !'# ! , % !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NOS.336 & 337/MDS/2015 ( )( / ASSESSMENT YEARS : 2008-09 & 2010-11 SHRI V. PANDARINATHAN, NO.1, BHARATHIYAR STREET, SUBRAMANIA NAGAR, SALEM 636 005. PAN : AEAPP 2538 Q V. THE INCOME TAX OFFICER, WARD I(3), THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE I(2), SALEM. (+,/ APPELLANT) (-.+,/ RESPONDENTS) +, / 0 / APPELLANT BY : SH.T.S.LAKSHMI VENKATARAMAN, CA -.+, / 0 / RESPONDENTS BY : SH. N. MADHAVAN, JCIT 1 / 2% / DATE OF HEARING : 12.05.2015 3') / 2% / DATE OF PRONOUNCEMENT : 29.05.2015 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: BOTH THE APPEALS OF THE ASSESSEE ARE DIRECTED AGA INST THE DIFFERENT ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS), SALEM, PERTAINING TO ASSESSMENT YEARS 2008-09 AND 2 010-11. FIRST, LETS TAKE I.T.A. NO.336/MDS15. 2 I.T.A. NOS.336 & 337/MDS/15 2. THE ONLY ISSUE ARISES FOR CONSIDERATION IN THIS APPEAL IS WITH REGARD TO DISALLOWANCE MADE BY THE ASSESSING OFFICE R UNDER SECTION 14A OF THE INCOME-TAX ACT, 1961 (IN SHORT ' THE ACT') TO THE EXTENT OF ` 2,38,765/- IN A PROCEEDING UNDER SECTION 154 OF THE ACT. 3. SHRI T.S. LAKSHMI VENKATRAMAN, THE LD. REPRESENT ATIVE FOR THE ASSESSEE, SUBMITTED THAT THE ASSESSING OFFICER DISALLOWED A SUM OF ` 2,38,765/- UNDER SECTION 14A OF THE ACT IN EXERCISE OF HIS JURISDICTION UNDER SECTION 154 OF THE ACT. ACCORDI NG TO THE LD. REPRESENTATIVE, PROCEEDING UNDER SECTION 154 OF THE ACT COULD BE INITIATED ONLY FOR THE PURPOSE OF RECTIFYING ERROR WHICH IS APPARENT ON THE FACE OF THE RECORD. ACCORDING TO THE LD. REPRE SENTATIVE, THE ISSUE ARISES FOR CONSIDERATION IS A DEBATABLE ONE, THEREFORE, IT IS NOT SUBJECT TO RECTIFICATION UNDER SECTION 154 OF THE A CT. ACCORDING TO THE LD. REPRESENTATIVE, DISALLOWANCE UNDER SECTION 14A NEEDS TO BE EXAMINED IN DETAIL IN REGULAR COURSE OF ASSESSMENT. THEREFORE, DISALLOWING THE CLAIM OF THE ASSESSEE IN A PROCEEDI NG UNDER SECTION 154 OF THE ACT IS NOT JUSTIFIED. 4. ON THE CONTRARY, SHRI N. MADHAVAN, THE LD. DEPAR TMENTAL REPRESENTATIVE, SUBMITTED THAT SECTION 154 ENABLES THE ASSESSING OFFICER TO RECTIFY AN ERROR APPARENT ON THE FACE OF THE RECORD. IN THAT PROCESS, THE ASSESSING OFFICER HAS AMENDED THE ORDE R PASSED 3 I.T.A. NOS.336 & 337/MDS/15 UNDER THE PROVISIONS OF INCOME-TAX ACT. ACCORDING TO THE LD. D.R., IN THIS CASE, WHAT WAS RECTIFIED IS ONLY AN ARITHME TICAL ERROR WHICH CREPT IN THE ORDER. THE LD. D.R. SUBMITTED THAT ON THE BASIS OF MATERIAL ALREADY AVAILABLE ON RECORD, THE ASSESSING OFFICER RECTIFIED THE ARITHMETICAL ERROR WHICH CREPT. THEREFORE, IT IS NOT A DEBATABLE ISSUE. HENCE, THE ASSESSING OFFICER HAS RIGHTLY DI SALLOWED THE CLAIM OF THE ASSESSEE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. THOUGH TH E ASSESSEE CLAIMS THAT THE ISSUE OF DISALLOWANCE UNDER SECTION 14A OF THE ACT IS A DEBATABLE ONE, FROM THE ORDERS OF THE LOWER AUTHO RITIES IT APPEARS THAT THE ASSESSING OFFICER HAS RECTIFIED THE ARITHM ETICAL ERROR WHILE DISALLOWING THE CLAIM OF THE ASSESSEE UNDER SECTION 14A OF THE ACT. WHAT WAS DISALLOWED BY THE ASSESSING OFFICER IS THE PROPORTIONATE EXPENSES ON THE INVESTMENTS WHICH EARNED TAX-FREE I NCOME. SINCE THE ASSESSING OFFICER HAS RECTIFIED THE ARITHMETICA L ERROR AND WHEN THIS WAS DONE AFTER GIVING REASONABLE OPPORTUNITY T O THE ASSESSEE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER HAS RIGHTLY RECTIFIED THE MISTAKE IN THE ASSESSMENT ORDER ON THE BASIS OF THE MATERIAL ALREADY AVAILABLE ON RECORD. 4 I.T.A. NOS.336 & 337/MDS/15 6. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIRMI TY IN THE ORDER OF THE CIT(APPEALS). ACCORDINGLY, THE SAME IS CONF IRMED. NOW LETS TAKE I.T.A. NO.337/MDS/15. 7. THE FIRST ISSUE ARISES FOR CONSIDERATION IN THIS APPEAL IS WITH REGARD TO DISALLOWANCE OF ` 1,55,100/- PAID AS MACHINE HIRE CHARGES UNDER SECTION 40(A)(IA) OF THE ACT. 8. SHRI T.S. LAKSHMI VENKATRAMAN, THE LD. REPRESENT ATIVE FOR THE ASSESSEE, SUBMITTED THAT THE ASSESSEE PAID MACH INE HIRE CHARGES. HOWEVER, THE ASSESSING OFFICER DISALLOWED THE HIRE CHARGES ON ACCOUNT OF NON-DEDUCTION OF TAX. ACCORD ING TO THE LD. REPRESENTATIVE, THE ENTIRE HIRE CHARGES WERE PAID O N OR BEFORE 31.03.2010 AND NOTHING REMAINED TO BE PAYABLE. THE LD. REPRESENTATIVE PLACING RELIANCE ON THE DECISION OF THIS BENCH OF THE TRIBUNAL IN ITO V. THEEKATHIR PRESS IN I.T.A. NO.20 76/MDS/2012 DATED 18.09.2013, SUBMITTED THAT THIS BENCH OF THE TRIBUNAL, BY FOLLOWING THE JUDGMENT OF ALLAHABAD HIGH COURT IN C IT V. VECTOR SHIPPING SERVICES (P) LTD. (357 ITR 642) AND THE DE CISION OF SPECIAL BENCH OF THIS TRIBUNAL IN MERILYN SHIPPING AND TRANSPORT V. ACIT (2012) 16 ITR (TRIB.) 1 (SB), ALLOWED THE CLAI M OF THE ASSESSEE. THEREFORE, ACCORDING TO THE LD. REPRESEN TATIVE, THE 5 I.T.A. NOS.336 & 337/MDS/15 DISALLOWANCE MADE BY THE ASSESSING OFFICER UNDER SE CTION 40(A)(IA) OF THE ACT IS NOT JUSTIFIED. 9. ALTERNATIVELY, THE LD. REPRESENTATIVE SUBMITTED THAT SECTION 40 STARTS WITH NON OBSTANTE CLAUSE WHICH SAYS THAT NOTWITHSTANDING ANYTHING TO THE CONTRARY IN SECTIONS 30 TO 38, THE AMOUNTS SHALL NOT BE DEDUCTED IN COMPUTING THE INCOME CHARGEABLE TO T AX UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. ACCORDING TO THE LD. REPRESENTATIVE, SECTIONS 30 TO 38 DO NOT REFER THE PAYMENT OF HIRE CHARGES ON MACHINE. ACCORDING TO THE LD. REPR ESENTATIVE, THE PAYMENT OF HIRE CHARGES ON MACHINE WOULD FALL UNDER SECTION 28 OF THE ACT, THEREFORE, THE PAYMENT OF HIRE CHARGES ON MACHINE DOES NOT FALL UNDER SECTION 40 OF THE ACT. THEREFORE, ACCOR DING TO THE LD. REPRESENTATIVE, THE DISALLOWANCE MADE UNDER SECTION 40(A)(IA) OF THE ACT IS TOTALLY CONTRARY TO THE PROVISIONS OF SE CTION 40(A)(IA) OF THE ACT. 10. ON THE CONTRARY, SHRI N. MADHAVAN, THE LD. DEPA RTMENTAL REPRESENTATIVE SUBMITTED THAT GUJARAT HIGH COURT AN D CAULCUTTA HIGH COURT SPECIFICALLY HELD THAT THE DECISION OF S PECIAL BENCH OF THIS TRIBUNAL IN MERILYN SHIPPING AND TRANSPORT V. ACIT (2012) 16 ITR (TRIB.) 1 (SB) IS NOT A GOOD LAW. THE ALLAHABA D HIGH COURT HAD NO OCCASION TO CONSIDER THE CORRECTNESS OF THE DECI SION OF THE 6 I.T.A. NOS.336 & 337/MDS/15 SPECIAL BENCH. HOWEVER, IT MADE ONLY A PASSING REF ERENCE. THEREFORE, THE JUDGMENT OF ALLAHABAD HIGH COURT IS PER INCURIAM . HENCE, IT IS NOT BINDING ON THIS TRIBUNAL THE SLP F ILED BY THE REVENUE WAS DISMISSED AT THE ADMISSION STAGE. THER EFORE, THE APEX COURT HAS NOT LAID DOWN ANY LAW ON THE SUBJECT . ACCORDING TO THE LD. D.R., THE LAW LAID DOWN BY GUJARAT HIGH COU RT AND CALCUTTA HIGH COURT HOLDS THE FIELD AS OF NOW. THEREFORE, I T HAS TO BE FOLLOWED. 11. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE FIRST CONTENTION OF THE ASSESSEE IS THAT THE ASSESSEE HAD ALREADY PAID ON O R BEFORE 31.03.2010 AND NOTHING REMAINED TO BE PAID. THE LD . REPRESENTATIVE PLACED RELIANCE ON THE JUDGMENT OF A LLAHABAD HIGH COURT IN VECTOR SHIPPING SERVICES (P) LTD. (SUPRA) AND ON THE DECISION OF THIS BENCH OF THE TRIBUNAL IN THEEKATHI R PRESS (SUPRA). WE HAVE CAREFULLY GONE THROUGH THE JUDGMENT OF ALLA HABAD HIGH COURT IN VECTOR SHIPPING SERVICES (P) LTD. (SUPRA). THE ALLAHABAD HIGH COURT, WHILE CONSIDERING THE DECISION OF THE S PECIAL BENCH OF THIS TRIBUNAL IN MERILYN SHIPPING AND TRANSPORT (SU PRA), MADE A PASSING REFERENCE ABOUT THE DECISION TAKEN BY THE S PECIAL BENCH OF THIS TRIBUNAL. THE ALLAHABAD HIGH COURT HAD NO OCC ASION TO 7 I.T.A. NOS.336 & 337/MDS/15 EXAMINE THE LEGALITY AND OTHERWISE OF THE SPECIAL B ENCH OF THIS TRIBUNAL. WE FIND THAT THAT CALCUTTA HIGH COURT IN CIT V. CRESCENT EXPORT SYNDICATES AND GUJARAT HIGH COURT IN CIT V. SIKANDARKHAN N. TUNVAR HAD AN OCCASION TO EXAMINE THE LEGALITY O R OTHERWISE OF THE DECISION OF THE SPECIAL BENCH OF THIS TRIBUNAL. THE CALCUTTA HIGH COURT AND THE GUJARAT HIGH COURT HAVE EXAMINED THE MATTER IN DETAIL AND FOUND THAT THE DECISION OF THE SPECIAL B ENCH OF THIS TRIBUNAL IS NOT SUSTAINABLE IN LAW. HOWEVER, THE A LLAHABAD HIGH COURT BY WAY OF PASSING REFERENCE DECIDED THE MATTE R IN FAVOUR OF THE ASSESSEE. THE SPECIAL LEAVE PETITION FILED BY THE REVENUE AGAINST THE JUDGMENT OF ALLAHABAD HIGH COURT IN VEC TOR SHIPPING SERVICES (P) LTD. (SUPRA) WAS REJECTED BY THE APEX COURT AT THE ADMISSION STATE. THEREFORE, THE APEX COURT HAS NOT LAID DOWN ANY LAW. IN OTHER WORDS, MERE DISMISSAL OF THE SPECIAL LEAVE PETITION BY THE APEX COURT AT THE ADMISSION STAGE DOES NOT AMOU NT TO LAYING DOWN ANY LAW ON THE ELABORATE JUDGMENTS ON THE GROU ND CALCUTTA HIGH COURT AND GUJARAT HIGH COURT AVAILABLE ON THE SAME SUBJECT. ON IDENTICAL CIRCUMSTANCES, THE COCHIN BENCH OF THI S TRIBUNAL IN THOMAS GEORGE MUTHOOT V. ACIT IN I.T.A. NO.63 & 64/ COCH/2014 HAD AN OCCASION TO CONSIDER AN IDENTICAL ISSUE. TH E COCHIN BENCH HAS OBSERVED AS FOLLOWS:- 8 I.T.A. NOS.336 & 337/MDS/15 12. WE HAVE ALSO CAREFULLY GONE THROUGH THE JUDGMEN T OF THE ALLAHABAD HIGH COURT IN CIT VS M/S VECTOR SHIPPING SERVICES (P) LTD (SUPRA), COPY OF WHICH IS FILED BY THE ASSE SSEE. THE ALLAHABAD HIGH COURT, AFTER REPRODUCING THE RELEVAN T PARAGRAPH FROM THE ORDER OF CIT(A) AND REFERRING TO THE DECIS ION OF THE SPECIAL BENCH OF THIS TRIBUNAL IN MERILYIN SHIPPING & TRANSPORTS (SUPRA) FOUND THAT THE TRIBUNAL HAS NOT COMMITTED A N ERROR. IT IS OBVIOUS THAT THERE IS NO DISCUSSION ABOUT THE CORRE CTNESS OR OTHERWISE OF THE DECISION RENDERED BY THE SPECIAL B ENCH OF THIS TRIBUNAL IN MERILYN SHIPPING & TRANSPORTS (SUPRA). HOWEVER, WE FIND THAT THE GUJARAT HIGH COURT IN THE CASE OF CIT VS SIKANDARKHAN N TUNVAR ITA NOS 905 OF 2012, 709 & 71 0 OF 2012, 333 OF 2013, 832 OF 2012, 857 OF 2012, 894 OF 2012, 928 OF 2012, 12 OF 2013, 51 OF 2013, 58 OF 2013 AND 218 OF 2013 JUDGMENT DATED 02-05-2013 CONSIDERED THE DECISION O F THE SPECIAL BENCH OF THIS TRIBUNAL IN MERILYN SHIPPING & TRANSPORTS (SUPRA) AND SPECIFICALLY DISAGREED WITH THE PRINCIP LES LAID DOWN BY THE SPECIAL OF THIS TRIBUNAL IN MERILYN SHIPPING & TRANSPORTS (SUPRA). THE CALCUTTA HIGH COURT ALSO IN THE CASE O F CRESCENT EXPORTS SYNDICATE & ANOTHER IN ITAT 20 OF 2013 AND GA 190 OF 2013 JUDGMENT DATED 03-04-2013 CONSIDERED ELABORATE LY THE JUDGMENT OF THE SPECIAL BENCH OF THIS TRIBUNAL IN M ERILYN SHIPPING & TRANSPORTS (SUPRA) AND FOUND THAT THE DE CISION RENDERED BY THE SPECIAL BENCH OF THIS TRIBUNAL IS N OT THE CORRECT LAW. IT IS WELL SETTLED PRINCIPLES OF LAW THAT WHEN DIFFERENT HIGH COURTS EXPRESSED DIFFERENT OPINIONS ON A POINT OF L AW, THEN, NORMALLY, THE BENEFIT OF DOUBT UNDER THE TAXATION L AW WOULD GO TO THE ASSESSEE. IT IS ALSO EQUALLY SETTLED PRINCIP LES OF LAW THAT THE JUDGMENT WHICH DISCUSSES THE POINT IN ISSUE ELA BORATELY AND GIVES AN ELABORATE REASONING HAS TO BE PREFERRED WH EN COMPARED TO THE JUDGMENT WHICH HAS NO REASONING AND DISCUSSION. ADMITTEDLY, THE CALCUTTA HIGH COURT AND GUJARAT HIGH COURT HAVE DISCUSSED THE ISSUE ELABORATELY AND THE SPECIFIC REASONING HAS ALSO BEEN RECORDED AS TO WHY THE SPECIAL BENCH IS NOT CORRECT. THEREFORE, THIS TRIBU NAL IS OF THE CONSIDERED OPINION THAT THE JUDGMENTS OF THE CALCUT TA HIGH COURT CRESCENT EXPORTS SYNDICATE & ANOTHER (SUPRA) AND GUJARAT HIGH COURT IN SIKANDARKHAN N TUNVAR (SUPRA) HAVE TO BE PREFERRED WHEN COMPARED TO THE ALLAHABAD HIGH CO URT IN M/S VECTOR SHIPPING SERVICES (P) LTD (SUPRA). 13. FOR THE PURPOSE OF CONVENIENCE WE REPRODUCING BELOW THE OBSERVATIONS MADE BY THE CALCUTTA HIGH COURT IN CRE SCENT EXPORTS SYNDICATE & ANOTHER (SUPRA) AND GUJARAT HIG H COURT IN SIKANDARKHAN N TUNVAR (SUPRA): CALCUTTA HIGH COURT IN CRESCENT EXPORTS SYNDICATE & ANOTHER (SUPRA) BEFORE DEALING WITH THE SUBMISSIONS OF THE LEARNED COUNSEL APPEARING FOR THE ASSESSEES IN BOTH THE 9 I.T.A. NOS.336 & 337/MDS/15 APPEALS WE HAVE TO EXAMINE THE CORRECTNESS OF THE MAJORITY VIEWS IN THE CASE OF MERILYN SHIPPING. WE ALREADY HAVE QUOTED EXTENSIVELY BOTH THE MAJORITY AND THE MINORITY VIEWS EXPRESSED IN THE AF ORESAID CASE. THE MAIN THRUST OF THE MAJORITY VIEW IS BASED ON THE FACT THAT THE LEGISLATURE HAS REPLACED THE EXPRESS ION AMOUNTS CREDITED OR PAID WITH THE EXPRESSION PAY ABLE IN THE FINAL ENACTMENT. COMPARISON BETWEEN THE PRE-AMENDMENT AND POST AMENDMENT LAW IS PERMISSIBLE FOR THE PURPOSE O F ASCERTAINING THE MISCHIEF SOUGHT TO BE REMEDIED OR THE OBJECT SOUGHT TO BE ACHIEVED BY AN AMENDMENT. THIS IS PRECISELY WHAT WAS DONE BY THE APEX COURT IN THE CA SE OF CIT VS. KELVINATOR REPORTED IN 2010(2) SCC 723. BUT THE SAME COMPARISON BETWEEN THE DRAFT AND THE ENACTED L AW IS NOT PERMISSIBLE. NOR CAN THE DRAFT OR THE BILL B E USED FOR THE PURPOSE OF REGULATING THE MEANING AND PURPORT O F THE ENACTED LAW. IT IS THE FINALLY ENACTED LAW WHICH IS THE WILL OF THE LEGISLATURE. THE LEARNED TRIBUNAL FELL INTO AN ERROR IN NOT REALIZING THIS ASPECT OF THE MATTER. THE LEARNED TRIBUNAL HELD THAT WHERE LANGUAGE IS CLEAR THE INTENTION OF THE LEGISLATURE IS TO BE GATHERED FROM THE LANGUAGE USED. HAVING HELD SO, IT WAS NOT OPEN TO SEEK TO INTERPRET THE SECTION ON THE BASIS OF AN Y COMPARISON BETWEEN THE DRAFT AND THE SECTION ACTUAL LY ENACTED NOR WAS IT OPEN TO SPECULATE AS TO THE EFFE CT OF THE SO-CALLED REPRESENTATIONS MADE BY THE PROFESSIONAL BODIES. THE LEARNED TRIBUNAL HELD THAT SECTION 40(A)(IA) OF THE ACT CREATES A LEGAL FICTION BY VIRTUE OF WHI CH EVEN THE GENUINE AND ADMISSIBLE EXPENSES CLAIMED BY AN ASSESSEE UNDER THE HEAD INCOME FROM BUSINESS AND PROFESSION: IF THE ASSESSEE DOES NOT DEDUCT TDS ON SUCH EXPENSES ARE DISALLOWED. HAVING HELD SO WAS IT OPEN TO THE TRIBUNAL TO SEE K TO JUSTIFY THAT THIS FICTION CANNOT BE EXTENDED AN Y FURTHER AND, THEREFORE, CANNOT BE INVOKED BY ASSESSING OFFI CER TO DISALLOW THE GENUINE AND REASONABLE EXPENDITURE ON THE AMOUNTS OF EXPENDITURE ALREADY PAID? DOES THIS NOT AMOUNT TO DELIBERATELY READING SOMETHING IN THE LAW WHICH IS NOT THERE? WE, AS SUCH, HAVE NO DOUBT IN OUR MIN D THAT THE LEARNED TRIBUNAL REALIZED THE MEANING AND PURPO RT OF SECTION 40(A)(IA) CORRECTLY WHEN IT HELD THAT IN CA SE OF OMISSION TO DEDUCT TAX EVEN THE GENUINE AND ADMISSI BLE EXPENSES ARE TO BE DISALLOWED. BUT THEY SOUGHT TO R EMOVE THE RIGOUR OF THE LAW BY HOLDING THAT THE DISALLOWA NCE SHALL BE RESTRICTED TO THE MONEY WHICH IS YET TO BE PAID. WHAT THE TRIBUNAL BY MAJORITY DID WAS TO SUPPLY THE CASU S OMISSUS WHICH WAS NOT PERMISSIBLE AND COULD ONLY HA VE BEEN DONE BY THE SUPREME COURT IN AN APPROPRIATE CA SE. 10 I.T.A. NOS.336 & 337/MDS/15 REFERENCE IN THIS REGARD MAY BE MADE TO THE JUDGMEN T IN THE CASE OF BHUWALKA STEEL INDUSTRIES VS. BOMBAY IR ON & STEEL LABOUR BOARD REPORTED IN 2010(2) SCC 273. UNPROTECTED WORKER WAS FINALLY DEFINED IN SECTION 2(11) OF THE MATHADI ACT AS FOLLOWS:- UNPROTECTED WORKER MEANS A MANUAL WORKER WHO IS ENGAGED OR TO BE ENGAGED IN ANY SCHEDULED EMPLOYMENT. THE CONTENTION RAISED WITH REFERENCE T O WHAT WAS THERE IN THE BILL WAS REJECTED BY THE SUPR EME COURT BY HOLDING AS FOLLOWS: IT MUST, AT THIS JUNC TURE, BE NOTED THAT IN SPITE OF SECTION 2(11), WHICH INCLUDE D THE WORDS BUT FOR THE PROVISIONS OF THIS ACT IS NOT AD EQUATELY PROTECTED BY LEGISLATION FOR WELFARE AND BENEFITS O F THE LABOUR FORCE IN THE STATE, THESE PRECISE WORDS WER E REMOVED BY THE LEGISLATURE AND THE DEFINITION WAS M ADE LIMITED AS IT HAS BEEN FINALLY LEGISLATED UPON. IT IS TO BE NOTED THAT WHEN THE BILL CAME TO BE PASSED AND RECE IVED THE ASSENT OF THE VICE-PRESIDENT ON 05-06-1969 AND WAS FIRST PUBLISHED IN THE MAHARASHTRA GOVERNMENT GAZET TE EXTRAORDINARY, PART IV ON 13-06-1969, THE AFOREMENT IONED WORDS WERE OMITTED. THEREFORE, T HIS WOULD BE A CLE AR POINTER TO THE LEGISLATIVE INTENT THAT THE LEGISLAT URE BEING CONSCIOUS OF THE FACT AND BEING ARMED WITH ALL THE COMMITTEE REPORTS AND ALSO BEING ARMED WITH THE FAC TUAL DATA, DELIBERATELY AVOIDED THOSE WORDS. WHAT THE APPELLANTS ARE ASKING WAS TO READ IN THAT DEFINITIO N, THESE PRECISE WORDS, WHICH WERE CONSCIOUSLY AND DELIBERAT ELY OMITTED FROM THE DEFINITION. THAT WOULD AMOUNT TO SUPPLYING THE CASUS OMISSUS AND WE DO NOT THINK THA T IT IS POSSIBLE, PARTICULARLY, IN THIS CASE. THE LAW OF SU PPLYING THE CASUS OMISSUS BY THE COURTS IS EXTREMELY CLEAR AND SETTLED THAT THOUGH THIS COURT MAY SUPPLY THE CASUS OMISSUS , IT WOULD BE IN THE RAREST OF THE RATE CASE AND THUS SU PPLYING OF THIS CASUS OMISSUS WOULD BE EXTREMELY NECESSARY DUE TO THE INADVERTENT OMISSION ON THE PART OF THE LEGI SLATURE. BUT, THAT IS CERTAINLY NOT THE CASE HERE. WE SHALL NOW ENDEAVOUR TO SHOW THAT NO OTHER INTERPRETATION IS POSSIBLE. THE KEY WORDS USED IN SECTION 40(A)(IA), ACCORDING TO US, ARE ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER CHAPTER XVII-B. IF THE QUESTION IS WHICH EX PENSES ARE SOUGHT TO BE DISALLOWED? THE ANSWER IS BOUND T O BE THOSE EXPENSES ON WHICH TAX IS DEDUCTIBLE AT SOURC E UNDER CHAPTER XVII-B. ONCE THIS IS REALIZED NOTHING TURNS ON THE BASIS OF THE FACT THAT THE LEGISLATURE USED THE WORD PAYABLE AND NOT PAID OR CREDITED. UNLESS ANY AM OUNT IS PAYABLE, IT CAN NEITHER BE PAID NOR CREDITED. IF N AMOUNT HAS NEITHER BEEN PAID NOR CREDITED, THERE CAN BE NO OCCASION FOR CLAIMING ANY DEDUCTION. THE LANGUAGE USED IN THE DRAFT WAS UNCLEAR AND SUSCEPTIBLE TO GIVING MORE THAN ONE MEANING. BY LOO KING 11 I.T.A. NOS.336 & 337/MDS/15 AT THE DRAFT IT COULD BE SAID THAT THE LEGISLATURE WANTED TO TREAT THE PAYMENTS MADE OR CREDITED IN FAVOUR OF A CONTRACTOR OF SUBCONTRACTOR DIFFERENTLY THAN THE PA YMENTS ON ACCOUNT OF INTEREST, COMMISSION OR BROKERAGE, FE ES FOR PROFESSIONAL SERVICES OR FEES FOR TECHNICAL SERVICE S BECAUSE THE WORDS MOUNTS CREDITED OR PAID WERE US ED ONLY IN RELATION TO A CONTRACTOR OF SUB-CONTRACTOR. THIS DIFFERENTIAL TREATMENT WAS NOT INTENDED. THEREFORE, THE LEGISLATURE PROVIDED THAT THE AMOUNTS, ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER XVII-B PAYABLE ON ACCOUN T OF INTEREST, COMMISSION OR BROKERAGE, RENT, ROYALTY, F EES FOR PROFESSIONAL SERVICES OR FEES FOR TECHNICAL SERVICE S OR TO A CONTRACTOR OF SUB-CONTRACTOR SHALL NOT BE DEDUCTED IN COM PUTTING THE INCOME OF AN ASSESSEE IN CASE HE HAS NO T DEDUCTED, OR AFTER DEDUCTION HAS NOT PAID WITHIN TH E SPECIFIED TIME. THE LANGUAGE USED BY THE LEGISLATUR E IN THE FINALLY ENACTED LAW IS CLEAR AND UNAMBIGUOUS WHEREA S THE LANGUAGE USED IN THE BILL WAS AMBIGUOUS. A FEW WORDS ARE NOW NECESSARY TO DEAL WITH THE SUBMISSION OF MR. BAGCHI AND MS. ROYCHOWDHURI. THER E CAN BE NO DENIAL THAT THE PROVISION IN QUESTION IS HARSH. BUT THAT IS NO GROUND TO READ THE SAME IN A MANNER WHICH WAS NOT INTENDED BY THE LEGISLATURE. THIS IS OUR AN SWER TO THE SUBMISSION OF MR. BAGCHI. THE SUBMISSION OF MR. ROYCHOWDHURI THAT THE SECOND PROVISO SOUGHT TO BECO ME EFFECTIVE FROM 1ST APRIL, 2013 SHOULD BE HELD TO HA VE ALREADY BECOME OPERATIVE PRIOR TO THE APPOINTED DAT E CANNOT ALSO BE ACCEDED TO FOR THE SAME REASON INDIC ATED ABOVE. THE LAW WAS DELIBERATELY MADE HARSH TO SECUR E COMPLIANCE OF THE PROVISIONS REQUIRING DEDUCTIONS O F TAX AT SOURCE. IT IS NOT THE CASE OF AN INADVERTENT ERROR. FOR THE REASONS DISCUSSED ABOVE, WE ARE OF THE OPINION THAT THE MAJORITY VIEWS EXPRESSED IN THE CA SE OF MERILYN SHIPPING & TRANSPORTS ARE NOT ACCEPTABLE. T HE SUBMISSIONS ADVANCED BY LEARNED ADVOCATES HAVE ALRE ADY BEEN DEALT WITH AND REJECTED. GUJARAT HIGH COURT IN SIKANDARKHAN N TUNVAR(SUPRA ) 23. DESPITE THIS NARROW INTERPRETATION OF SECTION 40(A)(IA), THE QUESTION STILL SURVIVES IF THE TRIBUNAL IN CASE OF M/S MERILYN SHIPPING & TRANSPORS VS. ACIT (SUPRA) WAS ACCURATE IN ITS OPINION. IN THIS CONTEXT, WE WOULD LIKE TO EXAMINE TWO ASPECTS. FIRSTLY, WHAT WOULD BE THE COR RECT INTERPRETATION OF THE SAID PROVISION. SECONDLY, WHE THER OUR SUCH UNDERSTANDING OF THE LANGUAGE USED BY THE LEGISLATURE SHOULD WAVER ON THE PREMISE THAT AS PROPOUNDED BY THE TRIBUNAL, THIS WAS A CASE OF CONS CIOUS OMISSION ON THE PART OF THE PARLIAMENT. BOTH THESE ASPECTS WE WOULD ADDRESS ONE AFTER ANOTHER. IF ONE LOOKS CL OSELY TO THE PROVISION, IN QUESTION, ADVERSE CONSEQUENCES OF NOT 12 I.T.A. NOS.336 & 337/MDS/15 BEING ABLE TO CLAIM DEDUCTION ON CERTAIN PAYMENTS IRRESPECTIVE OF THE PROVISIONS CONTAINED IN SECTION S 30 TO 38 OF THE ACT WOULD FLOW IF THE FOLLOWING REQUIREME NTS ARE SATISFIED:- (A) THERE IS INTEREST, COMMISSION OR BROKERAGE, REN T, ROYALTY, FEES FOR PROFESSIONAL SERVICES OR FEES FOR TECHNICAL SERVICES PAYABLE TO RESIDENT OR AMOUNTS PAYABLE TO A CONTRACTOR OR SUB-CONTRACTOR BEING RESIDENT FOR CAR RYING OUT ANY WORK. (B) THESE AMOUNTS ARE SUCH ON WHICH TAX IS DEDUCTIB LE AT SOURCE UNDER XVIII-B. (C) SUCH TAX HAS NOT BEEN DEDUCTED OR AFTER DEDUCTI ON HAS NOT BEEN PAID ON OR BEFORE DUE DATE SPECIFIED IN SU B- SECTION (1) OF SECTION 39. FOR THE PURPOSE OF CURRENT DISCUSSION REFERENCE T O THE PROVISO IS NOT NECESSARY. 24. WHAT THIS SUB-SECTION, THEREFORE, REQUIRES IS T HAT THERE SHOULD BE AN AMOUNT PAYABLE IN THE NATURE DESCRIBED ABOVE, WHICH IS SUCH ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER CHAPTER XVII-B BUT SUCH TAX HAS NOT BEEN DEDU CTED OR IF DEDUCTED NOT PAID BEFORE THE DUE DATE. THIS P ROVISION NOWHERE REQUIRES THAT THE AMOUNT WHICH IS PAYABLE M UST REMAIN SO PAYABLE THROUGHOUT DURING THE YEAR. TO RE ITERATE THE PROVISION HAS CERTAIN STRICT AND STRINGENT REQU IREMENTS BEFORE THE UNPLEASANT CONSEQUENCES ENVISAGED THEREI N CAN BE APPLIED. WE ARE PREPARED TO AND WE ARE DUTY BOUND TO INTERPRET SUCH REQUIREMENTS STRICTLY. SUCH REQUIREMENTS, HOWEVER, CANNOT BE ENLARGED BY ANY ADDITION OR SUBTRACTION OF WORDS NOT USED BY THE LEGISLATURE. THE TERM USED IS INTEREST, COMMISSION, BROKERAGE ETC. IS PAYABLE TO A RESIDENT OR AMOUNTS PAYABLE TO A CONTRACTOR OR SUB-CONTRACTOR FOR CARRY ING OUT ANY WORK. THE LANGUAGE USED IS NOT THAT SUCH AMOUNT MUST CONTINUE TO REMAIN PAYABLE TILL THE END OF THE ACCOUNTING YEAR. ANY SUCH INTERPRETATION WOULD REQU IRE READING WORDS WHICH THE LEGISLATURE HAS NOT USED. N O SUCH INTERPRETATION WOULD EVEN OTHERWISE BE JUSTIFIED BE CAUSE IN OUR OPINION, THE LEGISLATURE COULD NOT HAVE INTENDE D TO BRING ABOUT ANY SUCH DISTINCTION NOR THE LANGUAGE U SED IN THE SECTION BRINGS ABOUT ANY SUCH MEANING. IF THE INTERPRETATION S ADVANCED BY THE ASSESSEES IS ACCEP TED, IT WOULD LEAD TO A SITUATION WHERE THE ASSESSEE THOUGH WAS REQUIRED TO DEDUCT THE TAX AT SOURCE BUT NO SUCH DE DUCTION WAS MADE OR MORE FLAGRANTLY DEDUCTION THOUGH MADE I S NOT PAID TO THE GOVERNMENT, WOULD ESCAPE THE CONSEQUENCE ONLY BECAUSE THE AMOUNT WAS ALREADY PAI D OVER BEFORE THE END OF THE YEAR IN CONTRAST TO ANOT HER ASSESSEE WHO WOULD OTHERWISE BE IN SIMILAR SITUATIO N BUT IN WHOSE CASE THE AMOUNT REMAINED PAYABLE TILL THE END OF THE YEAR. WE SIMPLY DO NOT SEE ANY LOGIC WHY THE 13 I.T.A. NOS.336 & 337/MDS/15 LEGISLATURE WOULD HAVE DESIRED TO BRING ABOUT SUCH IRRECONCILABLE AND DIVERSE CONSEQUENCES. WE HASTEN TO ADD THAT THIS IS NOT THE PRIME BASIS ON WHICH WE HA VE ADOPTED THE INTERPRETATION WHICH WE HAVE GIVEN. IF THE LANGUAGE USED BY THE PARLIAMENT CONVEYED SUCH A MEANING, WE WOULD NOT HAVE HESITATED IN ADOPTING SU CH AN INTERPRETATION. WE ONLY HIGHLIGHT THT WE WOULD NOT READILY ACCEPT THAT THE LEGISLATURE DESIRED TO BRING ABOUT AN INCONGRUOUS AND SEEMINGLY IRRECONCILABLE CONSEQUENC ES. THE DECISION OF HE SUPREME COURT IN THE CASE OF COMMISSIONER OF INCOME-TAX, GUJARAT VS. ASHOKBHAI CHIMANBHAI (SUPRA), WOULD NO6T ALTER THIS SITUATION . THE SAID DECISION, OF COURSE, RECOGNIZES THE CONCEPT OF ASCERTAINING THE PROFIT AND LOSS FROM THE BUSINESS OR PROFESSION WITH REFERENCE TO A CERTAIN PERIOD I.E. THE ACCOUNTING YEAR. IN THIS CONTEXT, LAST DATE OF SUCH ACCOUNTING PERIOD WOULD ASSUME CONSIDERABLE SIGNIFICANCE. HOWEVER, THIS DECISION NOWHERE INDICA TES THAT THE EVENTS WHICH TAKE PLACE DURING THE ACCOUNT ING PERIOD SHOULD BE IGNORED AND THE ASCERTAINMENT OF F ULFILLING A CERTAIN CONDITION PROVIDED UNDER THE STATUTE MUST BE JUDGED WITH REFERENCE TO LAST DATE OF THE ACCOUNTIN G PERIOD. PARTICULARLY, IN THE CONTEXT OF REQUIREMENTS F SECT ION 40(A)(IA) OF THE ACT, WE SEE NO WARRANT IN THE SAID DECISION OF THE SUPREME COURT TO APPLY THE TEST OF PAYABILIT Y ONLY AS ON 31ST MARCH OF THE YEAR UNDER CONSIDERATION. MERE LY BECAUSE, ACCOUNTS ARE CLOSED ON THAT DATE AND THE COMPUTATION OF PROFIT AND LOSS IS TO BE JUDGED WITH REFERENCE TO SUCH DATE, DOES NOT MEAN THAT WHETHER AN AMOUNT IS PAYABLE OR NOT MUST BE ASCERTAINED ON THE STRENGTH OF THE POSITION EMERGING ON 31T MARCH. 25. THIS BRINGS US TO THE SECOND ASPECT OF THIS DIS CUSSION, NAMELY, WHETHER THIS IS A CASE OF CONSCIOUS OMISSIO N AND THEREFORE, THE LEGISLATURE MUST BE SEEN TO HAVE DELIBERATELY BROUGHT ABOUT A CERTAIN SITUATION WHIC H DOES NOT REQUIRE ANY FURTHER INTERPRETATION. THIS IS THE FUNDAMENTAL ARGUMENT OF THE TRIBUNAL IN THE CASE OF M/S MERILYN SHIPPING & TRANSPORTS VS. ACIT (SUPRA) TO A DOPT A PARTICULAR VIEW. 26. WHILE INTERPRETING A STATUTORY PROVISION THE CO URTS HAVE OFTEN APPLIED HYDENS RULE OR THE MISCHIEF RUL E AND ASCERTAINED WHAT WAS THE POSITION BEFORE THE AMENDM ENT, WHAT THE AMENDMENT SOUGHT TO REMEDY AND WHAT WAS TH E EFFECT OF THE CHANGES. 27 TO 36.. 37. IN OUR OPINION, THE TRIBUNAL COMMITTED AN ERROR IN APPLYING THE PRINCIPLE OF CONSCIOUS OMISSION IN THE PRESENT CASE. FIRSTLY, AS ALREADY OBSERVED, WE HAVE SERIOUS DOUBT WHETHER SUCH PRINCIPLE CAN BE APPLIED BY COMPARING THE DRAFT PRESENTED IN PARLIAMENT AND ULTIMATE LEGISLAT ION 14 I.T.A. NOS.336 & 337/MDS/15 WHICH MAY BE PASSED. SECONDLY, THE STATUTORY PROVIS IONS IS AMPLY CLEAR. 38. IN THE RESULT, W ARE OF THE OPINION THAT SECTIO N 40(A)(IA) WOULD COVER NOT ONLY TO THE AMOUNTS WHICH ARE PAYAB LE AS ON 20 ITA NO. 63&64M 83-85&7-72/COCH/2014 31ST MARCH OF A PARTICULAR YEAR BUT ALSO WHICH ARE PAYAB LE AT ANY TIME DURING THE YEAR. OF COURSE, AS LONG AS THE OTHER REQUIREMENT OF THE SAID PROVISION EXIST. IN THAT CO NTEXT, IN OUR OPINION THE DECISION OF THE SPECIAL BENCH OF TH E TRIBUNAL IN THE CASE OF M/S MERILYN SHIPPING & TRAN SPORTS VS ACIT (SUPRA), DOES NOT LAY DOWN CORRECT LAW. 14. BY FOLLOWING THE JUDGMENTS OF THE CALCUTTA HIG H COURT IN CRESCENT EXPORT SYNDICATE (SUPRA) AND THE GUJARAT HIGH COURT IN SIKANDARKHAN N TUNVAR (SUPRA), THIS TRIBUN AL IS OF THE CONSIDERED OPINION THAT THE DECISION OF THE SPECIAL BENCH OF THIS TRIBUNAL IN THE CASE OF M/S MERILYN SHIPPING & TRANSPORTS (SUPRA) AND THE JUDGMENT OF THE ALLAHABAD HIGH COUR T IN VECTOR SHIPPING SERVICES (P) LTD (SUPRA) ARE NOT APPLICABL E TO THE FACTS OF THE CASE UNDER CONSIDERATION WHEREAS THE JUDGMEN TS OF THE CALCUTTA HIGH COURT IN CRESCENT EXPORT SYNDICATE (S UPRA) AND THE GUJARAT HIGH COURT IN SIKANDARKHAN N TUNVAR (SU PRA) ARE SQUARELY APPLICABLE TO THE FACTS OF THE CASE. RESPE CTFULLY FOLLOWING THE JUDGMENTS OF THE CALCUTTA HIGH COURT IN CRESCENT EXPORT SYNDICATE (SUPRA) AND THE GUJARAT HIGH COURT IN SIKANDARKHAN N TUNVAR (SUPRA), WE DO NOT SEE ANY IN FIRMITY IN THE ORDERS OF THE LOWER AUTHORITIES. ACCORDINGLY, T HE ORDERS OF THE LOWER AUTHORITIES ARE CONFIRMED. 12. ONE OF US, THE JUDICIAL MEMBER IS A PARTY TO TH E ABOVE ORDER OF THE COCHIN BENCH OF THIS TRIBUNAL. IN FACT, THE ASSESSEE BEFORE THE COCHIN BENCH FILED A MISCELLANEOUS PETITION ON THE GROUND THAT THERE IS AN ERROR IN THE ORDER OF THIS TRIBUNAL. T HE COCHIN BENCH REJECTED THE MISCELLANEOUS PETITION FILED BY THE AS SESSEE. THE ASSESSEE CHALLENGED THE CORRECTNESS OF THE ORDER PA SSED BY THE COCHIN BENCH ON THE MISCELLANEOUS PETITION BY WAY O F WRIT PETITION BEFORE THE KERALA HIGH COURT. THE KERALA HIGH COUR T, HOWEVER, DISMISSED THE WRIT PETITION FILED BY THE ASSESSEE. IN THOSE 15 I.T.A. NOS.336 & 337/MDS/15 CIRCUMSTANCES, THIS TRIBUNAL IS OF THE CONSIDERED O PINION THAT THE JUDGMENTS OF CALCUTTA HIGH COURT AND GUJARAT HIGH C OURT HAVE TO BE PREFERRED RATHER THAN THE JUDGMENT OF ALLAHABAD HIGH COURT. IN OTHER WORDS, THE JUDGMENT OF ALLAHABAD HIGH COURT D OES NOT CONTAIN ANY REASONING, THEREFORE, IT HAS TO BE TREATED AS PER INCURIAM . BY RESPECTFULLY FOLLOWING THE JUDGMENTS OF CALCUTTA HI GH COURT IN CRESCENT EXPORT SYNDICATES (SUPRA) AND GUJARAT HIGH COURT IN SIKANDARKHAN N. TUNVAR (SUPRA) FOR THE REASONS STAT ED THEREIN, WE UPHOLD THE ORDER OF THE CIT(APPEALS). 13. NOW COMING TO THE ALTERNATIVE CONTENTION OF THE ASSESSEE, ADMITTEDLY, THE ASSESSEE CLAIMS THAT IT IS A BUSINE SS EXPENDITURE. FOR THE PURPOSE OF BUSINESS, BUSINESS EXPENDITURE W OULD FALL UNDER SECTION 37(1) OF THE ACT. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE PROVISIONS OF SECTION 4 0 OF THE ACT IS EQUALLY APPLICABLE. HIRE CHARGES PAID BY THE ASSES SEE ON MACHINE IS LIABLE FOR DEDUCTION OF TAX UNDER SECTION 194-I OF THE ACT. THEREFORE, THE ASSESSEE IS EXPECTED TO DEDUCT TAX A T THE TIME OF MAKING THE PAYMENT. THEREFORE, THE ALTERNATIVE CON TENTION OF THE ASSESSEE IS ALSO DOES NOT HOLD ANY MERIT AT ALL. A CCORDINGLY, THE ORDER OF THE CIT(APPEALS) IS CONFIRMED. 16 I.T.A. NOS.336 & 337/MDS/15 14. THE NEXT GROUND ARISES FOR CONSIDERATION IS WIT H REGARD TO DEPRECIATION ON MARUTHI CAR. 15. SHRI T.S. LAKSHMI VENKATRAMAN, THE LD. REPRESEN TATIVE FOR THE ASSESSEE, SUBMITTED THAT THE ASSESSEE HAS CLAIM ED FOR DEPRECIATION ON MARUTHI CAR. HOWEVER, ON INNOVA CA R, THE ASSESSEE HAS RESTRICTED THE DEPRECIATION TO 50% OF THE NORMA L RATE OF DEPRECIATION. ACCORDING TO THE LD. REPRESENTATIVE, WHEN THE ASSESSEE HIMSELF RESTRICTED THE DEPRECIATION TO 50% OF NORMAL RATE OF DEPRECIATION, THERE IS NO QUESTION OF ANY DISALL OWANCE. EVEN OTHERWISE, ACCORDING TO THE LD. REPRESENTATIVE, AFT ER INTRODUCTION OF THE CONCEPT OF BLOCK ASSET ON DEPRECIATION, IT WO ULD NOT BE POSSIBLE TO DISALLOW ANY PORTION OF THE DEPRECIATIO N FOR PERSONAL USE OF THE VEHICLE. ACCORDING TO THE LD. REPRESENTATIV E, THE CAR WAS USED ONLY FOR BUSINESS PURPOSE, THEREFORE, THERE IS NO QUESTION OF ANY DISALLOWANCE. THE LD. REPRESENTATIVE PLACED RE LIANCE ON THE JUDGMENT OF MADRAS HIGH COURT IN THE CASE OF CIT V. INDIAN EXPRESS (P) LTD. (255 ITR 68) AND SUBMITTED THAT EVEN WHERE THE MACHINERY WAS USED BY THE SISTER CONCERN OF THE ASSESSEE, THE MADRAS HIGH COURT FOUND THAT THE ASSESSEE IS ELIGIBLE FOR DEPRE CIATION UNDER SECTION 32(2) OF THE ACT. 17 I.T.A. NOS.336 & 337/MDS/15 16. ON THE CONTRARY, SHRI N. MADHAVAN, THE LD. DEPA RTMENTAL REPRESENTATIVE SUBMITTED THAT THE USE OF THE VEHICL E FOR PERSONAL PURPOSE CANNOT BE RULED OUT. 17. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. AS RIGHTL Y SUBMITTED BY THE LD. REPRESENTATIVE FOR THE ASSESSEE, THE ASSESSEE H AS CLAIMED DEPRECIATION ON INNOVA CAR AT 50% OF NORMAL RATE. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE IS NO QUESTION OF MAKING ANY FURTHER DISALLOWANCE ON MARUTHI CAR. IT IS NOT IN DISPUTE THAT MARUTHI CAR WAS USED FOR BUSINESS PURPOSE. TH EREFORE, THE ASSESSEE IS ENTITLED TO CLAIM DEPRECIATION ON THE M ARUTHI CAR. ACCORDINGLY, THE ORDERS OF THE LOWER AUTHORITIES AR E SET ASIDE AND THE ASSESSING OFFICER IS DIRECTED TO ALLOW THE DEPRECIA TION ON MARUTHI CAR MAINTENANCE EXPENSES AS CLAIMED BY THE ASSESSEE . 18. IN THE RESULT, ASSESSEES APPEAL IN I.T.A. NO.3 36/MDS/15 IS DISMISSED AND APPEAL IN I.T.A. NO.337/MDS/15 IS PAR TLY ALLOWED. ORDER PRONOUNCED ON 29 TH MAY, 2015 AT CHENNAI. SD/- SD/- (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) (. !'# ! ) ( . . . ) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER 18 I.T.A. NOS.336 & 337/MDS/15 /CHENNAI, 5 /DATED, THE 29 TH MAY, 2015. KRI. / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A), SALEM 4. 1 92 /CIT, SALEM 5. 7: -2 /DR 6. ( ; /GF.