Nabros Transport Pvt. Ltd., Ahmedabad V. DCIT, Circle-3(1)(1), Ahmedabad

ITA 345/AHD/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 3202 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 03-12-2019
• Assessment Year: 2014-2015
• Appeal Filed On: 13-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIDHUT TRIVEDI
• Keywords: Depreciation; Set aside
• Section: 143(3); 32; 148

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, HONBLE JUDICIAL MEMBER AND SHRI WASEEM AHMED HONBLE ACCOUNTANT MEMBER ITA.NO.345/AHD/2018 / ASSTT.YEAR : 2014-15 AND ITA NO.311/AHD/2019 ASSTT.YEAR : 2012-13 NABROS TRANSPORT P.LTD. D/1201, TITONIUM SQUARE THALTEJ CROSS ROAD, THALTEJ, AHMEDABAD 380 054. VS DCIT, CIR.3(1)(1) AHMEDABAD. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SMT.ARTI N. SHAH, AR REVENUE BY : SHRI VIDHUT TRIVEDI, SR.DR / DATE OF HEARING : 03/12/2019 / DATE OF PRONOUNCEMENT: 04/12/2019 !'/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER PRESENT TWO APPEALS ARE FILED AT THE INSTANCE OF TH E ASSESSEE AGAINST ORDERS OF THE LD.CIT(A)-9, AHMEDABAD DATED 4.12.201 7 AND 31.12.2018 PASSED FOR THE ASSESSMENT YEARS 2014-15 AND 2012-13 RESPECTIVELY. SINCE COMMON ISSUE IS RAISED IN BOTH THE APPEALS, WE PROC EED TO DISPOSE OF THEM BY THIS COMMON ORDER. ITA NO.345/AHD/2018 AND 311/AHD/2019 2 2. SOLE GRIEVANCE IN BOTH THE APPEALS IS THAT THE L D.CIT(A) HAS ERRED IN CONFIRMING DISALLOWANCE OF DEPRECIATION OF RS.4,75, 989/- FOR THE ASSTT.YEAR 2014-15 AND RS.19,03,955/- FOR THE ASSTT.YEAR 2012 -13 UNDER SECTION 32 OF THE INCOME TAX ACT, 1961. 3. AS NOTED EARLIER, FACTS ARE IDENTICAL IN BOTH TH E YEARS EXCEPT QUANTUM. THEREFORE, FOR THE SAKE OF CONVENIENCE, WE TAKE THE FACTS FROM THE ASSESSMENT ORDER PASSED IN THE ASSTT.YEAR 2012-13. THAT THE A SSESSEE HAS FILED HIS RETURN OF INCOME ON 29.9.2012 DECLARING TOTAL INCOME AT RS .7,67,80,210/-, WHICH WAS ASSESSED UNDER SECTION 143(3) OF THE ACT. THEREAFT ER, CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSMENT AND ISSUED NOTICE UNDER SECTION 148 OF THE ACT ON 29.6.2016. DURING THE SCRUTINY ASSESSMENT, IT WAS NOTICED BY THE AO THAT THE ASSESSEE HAS CLAIMED DEPRECIATION OF RS.27 ,19,935/- @ 50% ON WRITTEN DOWN VALUE OF RS.54,39,869/- ON VEHICLES CA TEGORIZED UNDER PLANT & MACHINERY. THE LD.AO NOTED THAT SINCE VEHICLES WER E PURCHASED IN THE F.Y.2009-10 AND CLAIMED DEPRECATION AT 50% IN F.Y.2 010-11, THEREFORE, NO FURTHER DEPRECIATION AT 50% WOULD NOT BE ALLOWABLE TO THE ASSESSEE IN THE ASSTT.YEAR 2012-13. IT WAS FURTHER NOTED BY THE AO THAT ENHANCED DEPRECIATION, IF ANY WOULD BE ALLOWABLE ONLY UPTO T HE ASSTT.YEAR 2010-11 AND FOR SUBSEQUENT PERIOD. THE LD.AO ACCORDINGLY SHOW C AUSED THE ASSESSEE AS TO WHY CLAIM OF ENHANCED DEPRECIATION AT 50% BE NOT DE NIED, AND REGULAR RATE OF DEPRECIATION AT 15% BE NOT APPLIED. IT WAS EXPLAI NED BY THE ASSESSEE THAT AS PER CBDT NOTIFICATION NO.10 OF 2009 SPECIAL RATE OF DEPRECIATION AT 50% ON NEW COMMERCIAL VEHICLES ACQUIRED AND PUT TO USE BET WEEN 1 ST JANUARY AND 31 ST MARCH, 2009, THE BENEFIT OF DEPRECIATION AT HIGHER RATE WAS AVAILABLE EVEN FOR SUBSEQUENT YEARS ALSO. THE LD.AO, HOWEVER, REJECTE D EXPLANATION OF THE ASSESSEE AND HELD THAT ENHANCED DEPRECATION WAS VAL ID FOR A.Y.2010-11 ONLY AND NO SEPARATE BLOCK OF ASSETS FOR CLAIMING ENHANC ED DEPRECIATION WAS GIVEN ITA NO.345/AHD/2018 AND 311/AHD/2019 3 IN THE RULE. HE ACCORDINGLY REJECTED CLAIM OF THE ASSESSEE, AND APPLIED DEPRECIATION AT NORMAL RATE OF 15%. THE EXCESS DEP RECIATION CLAIMED BY THE ASSESSEE WAS DISALLOWED AND ADDED TO THE TOTAL INCO ME OF THE ASSESSEE. IN THE APPEAL BEFORE THE LD.CIT(A), ASSESSEE DID NOT ANY R ELIEF. WHILE CONFIRMING THE ACTION OF THE AO, THE LD.CIT(A) HAS FOLLOWED OR DER OF HIS PREDECESSOR FOR THE ASSTT.YEAR 2013-14, WHICH IN TURN FOLLOWED ORDE R OF THE LD.CIT(A) IN APPEAL ORDER NO.CIT(A)-7/296/16-17 DATED 8.9.2017 I N THE CASE OF THE ASSESSEE FOR THE ASSTT.YEAR 2011-12. THE ASSESSEE IS NOW IN FURTHER BEFORE THE TRIBUNAL. 4. BEFORE US, THE LD.COUNSEL FOR THE ASSESSEE REITE RATED SUBMISSIONS MADE BEFORE THE REVENUE AUTHORITIES. HE FURTHER SUBMITT ED THAT SIMILAR ISSUE AROSE IN THE A.Y.2011-12 ALSO, AND THE SAME WAS TRAVELLED UPTO THE TRIBUNAL, AND THE TRIBUNAL IN ITA NO.2847/AHD/2017 ALLOWED CLAIM OF THE ASSESSEE. HE PLACED ON RECORD COPY OF THE ORDER OF THE TRIBUNAL DATED 28.5.2019, WHEREIN ENHANCED CLAIM OF THE ASSESSEE WAS ALLOWED. ON THE OTHER HAND, THE LD.DR SUPPORTED THE ORDERS OF THE REVENUE AUTHORITIES. 5. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND GONE TH ROUGH THE RECORD CAREFULLY. ISSUE BEFORE US IS WITH REGARD TO THE A LLOWABILITY OF ENHANCED DEPRECIATION ON NEW VEHICLES ACQUIRED BY THE ASSESS EE DURING 01.01.2009 TO 01.10.2009. NOW AS PER THE AMENDED CBDT CIRCULAR N O.10 OF 2009, NEW COMMERCIAL VEHICLE WHICH IS ACQUIRED ON OR AFTER TH E 1ST DAY OF JANUARY, 2009 BUT BEFORE THE 1ST DAY OF APRIL, 2009 AND IS PUT TO USE BEFORE THE 1ST DAY OF APRIL, 2009 FOR THE PURPOSES OF BUSINESS OR PROFESS ION, THE ASSESSEE IS ENTITLED FOR DEPRECATION AT 50% ON SUCH VEHICLES. THIS ASPE CT HAS BEEN CONSIDERED BY THE ITAT IN THE ASSESSEES OWN CASE IN ITA NO.2847/ AHD/2017 AND HELD THAT ITA NO.345/AHD/2018 AND 311/AHD/2019 4 ENHANCED RATE IS APPLICABLE TO THE SUBSEQUENT YEAR ALSO. THE RELEVANT PORTION OF THE ITATS ORDER READS AS UNDER: 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS. THE ELIGIBILITY OF DEPRECIATION AT ACCELERATED RATE ON NEW COMMERCI AL VEHICLES ACQUIRED BETWEEN 01.01.2009 TO 01.10.2009 IS IN CON TROVERSY. AS NOTED EXTENSIVELY IN EARLIER PARAS. NOTIFICATION NO. 10/2 009 ISSUED BY THE CBDT DATED 19.01.2009 ALONG WITH SUBSEQUENT MODIFIC ATION THEREIN (TOWARDS PERIOD OF ACQUISITION OF ASSET), THE ASSES SEE IS ENTITLED TO DEPRECIATION @ 50% ON ALL NEW COMMERCIAL VEHICLES A CQUIRED WITHIN THE STIPULATED TIME FRAME. THE TABLE TO NEW APPENDI X-I PRESCRIBING THE RATES AT WHICH DEPRECIATION IS ADMISSIBLE HAS ALSO BEEN SIMULTANEOUSLY AMENDED BY THE CBDT IN EXCISE OF POWERS CONFERRED T O IT BY SEC. 295 OF THE INCOME TAX ACT, 1961, THEREFORE, APPLYING LOWER RATE OF DEPRECIATION IN VARIANCE WITH THE SPECIAL RATE OF D EPRECIATION ALLOWANCE DO NOT RESONATE WITH THE AMENDED POSITION OF LAW. WE THUS, FIND CONSIDERABLE MERIT IN THE PLEA TAKEN ON BEHALF OF THE ASSESSEE AS NOTED IN PRECEDING PARAGRAPH. THE ACTION OF REVENUE TO RESTRICT THE HIGHER DEPRECIATION TO ONLY FIRST YEAR WHERE ASSETS WERE ACQUIRED IS DEVOID OF SOUND BASIS AND CONTRARY TO THE NOTIFICAT ION. CONSEQUENTLY, WE SET ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE AO TO RESTORE THE CLAIM OF DEPRECIATION ALLOWANCE ON COMMERCIAL VEHIC LES AT ACCELERATED PERCENTAGE. 6. IN VIEW OF THE ABOVE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y.2011-12, FOLLOWING T HE SAME, WE ALLOW THE CLAIM OF THE ASSESSEE FOR THE ENHANCED DEPRECIATION AT THE RATE OF 50%, AND ALLOW GROUND OF APPEAL OF THE ASSESSEE IN BOTH THE YEARS. 7. IN THE RESULT, BOTH APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON 4 TH DECEMBER, 2019 AT AHMEDABAD. SD/- SD/- (WASEEM AHMED ) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 04/12/2019