DCIT, New Delhi V. M/s. Kribhco Shyam Fertilizers Ltd., New Delhi

ITA 3490/DEL/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 4790 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2013-2014
• Appeal Filed On: 01-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRINALINI SAPRA
• Assessee Lawyers: BIREN SHAH
• Keywords: Capital asset; Business income; Depreciation; Bad and doubtful debts; Capital receipt
• Section: 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI F BENCH: NEW DELHI (THROUGH VIDEO CONFERENCING ) BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER & DR.B.R.R.KUMAR, ACCOUNTANT MEMBER ITA NOS.3489 & 3490/DEL/2017 ASSESSMENT YEARS : 2012-13 & 2013-14 DCIT, CIRCLE-14(2), ROOM NO.311A, 3 RD FLOOR, C.R.BUILDING, I.P.ESTATE, NEW DELHI. VS KRIBHCO SHYAM FERTILIZERS LTD., A-60, KAILASH COLONY, NEW DELHI-110048. PAN-AACCK6999B APPELLANT RESPONDENT ITA NO.6100/DEL/2017 ASSESSMENT YEAR : 2014-15 ACIT, CIRCLE-14(2), ROOM NO.323, 3 RD FLOOR, C.R.BUILDING, I.P.ESTATE, NEW DELHI-110048. VS KRIBHCO SHYAM FERTILIZERS LTD., A-60, KAILASH COLONY, NEW DELHI-110048. PAN-AACCK6999B APPELLANT RESPONDENT APPELLANT BY MS. MRINALINI SAPRA, SR.DR RESPONDENT BY SH.VARTIK CHOKSI, CA & SH. BIREN SHAH, CA DATE OF HEARING 25.08.2021 DATE OF PRONOUNCEMENT 30 .09.2021 ORDER PER KUL BHARAT, JM : THESE THREE APPEALS FILED BY THE REVENUE PERTAI NING TO THREE DIFFERENT ASSESSMENT YEARS I.E. 2012-13, 2013-14 & 2014-15 AR E DIRECTED AGAINST THE SEPARATE ORDERS OF LD. CIT(A)-5, DELHI DATED 23.03. 2017, 23.03.2017 & 14.07.2017 RESPECTIVELY. SINCE THE IDENTICAL GROUN DS HAVE BEEN RAISED, ALL THESE THREE APPEALS ARE TAKEN UP TOGETHER AND ARE B EING DISPOSED OFF BY THIS CONSOLIDATED ORDER. ITA NOS.3489/DEL/2017 & OTHERS 2 | P A GE 2. FIRSTLY, WE TAKE UP ITA NO.3489/DEL/2017 (ASSESSMENT YEAR 2012-13) OF THE REVENUES APPEAL. THE REVENUE HAS RAISED FO LLOWING GROUNDS OF APPEAL:- 1. 'LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELE TING THE ADDITION OF RS.7,11,35,236/- BEING DEPRECIATION ON INTANGIBLE A SSETS WHILE RELYING ON THE APPELLATE ORDERS OF HER PREDECESSORS, WHICH HAV E NOT BEEN ACCEPTED BY DEPARTMENT AND THE DEPARTMENTAL APPEALS ARE PENDING BEFORE HON'BLE ITAT. 2. LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELE TING THE ADDITION OF RS.7,11,35,236/- BEING DEPRECIATION ON INTANGIBLE A SSETS WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE HAS FAILED TO FURNISH VALUATION OF THE INTANGIBLE ASSETS AND SUBSTANTIATE THE SAME. 3. LD.CIT(A) IS ERRED IN LAW AND ON FACTS IN DELETI NG THE ADDITION ON ACCOUNT OF DISALLOWANCE OF DEPRECIATION OF RS.7,11, 35,236/- ON THE BLOCK OF INTANGIBLE ASSETS WITHOUT APPRECIATING THAT THE VAL UATION OF INTANGIBLE ASSETS OF 1246.69 CRORE OUT OF TOTAL CONSIDERATION OF RS.1908 CRORE IS ON ACCOUNT OF GOING CONCERN BESIDES VALUATION OF FIXED ASSETS I.E. BUILDING PLANT AND MACHINERY. 4. LD.CIT(A) IS ERRED IN LAW AND ON FACTS IN DELETI NG THE ADDITION OF RS.7,11,35,236/- BEING DEPRECIATION ON INTANGIBLE A SSETS CLAIMED IN THE FORM OF GAS PRICE RIGHTS, LOCATIONAL BENEFITS OF PR ESENT AND FUTURE PRODUCTS AND TRAINED MANPOWER WITHOUT APPRECIATING THAT GAS PRICE AND PRODUCTS ARE UNDER GOVERNMENT CONTROL FOR WHICH NO INTANGIBLE ASSETS CAN BE CREATED AND THE ASSESSEE COMPANY IS ALREADY CLAI MING SALARY AND WAGES OF SKILLED MANPOWER THUS CLAIMING DOUBLE DEDU CTION FOR THE SAME SKILLED MANPOWER CLAIMED AS INTANGIBLE ASSETS AS WE LL AS DEPRECIATION.' 5. LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELET ING THE ADDITION OF RS.5,75,53,800/- ON ACCOUNT OF LOSS ON SALE OF INVE STMENT IN THE FORM THE FERTILIZERS BONDS WHILE WRONGLY CONSIDERING THAT LO SS ON SALE OF FERTILIZERS BONDS WILL BE REVENUE LOSS AND EQUATING THE BONDS W ITH SUBSIDY.' ITA NOS.3489/DEL/2017 & OTHERS 3 | P A GE 6. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR FOREGO ANY GROUND(S) OF THE APPEAL RAISED ABOVE AT THE TIME OF HEARING.' 3. THE FACTS IN BRIEF ARE THAT THE ASSESSEE COMPANY FILED ITS RETURN ON 28.09.2012 DECLARING INCOME AT RS.36,170/-. HOWEV ER, HE HAS PAID TAX ON BOOK PROFIT U/S 115JB OF THE INCOME TAX ACT, 1961 ( THE ACT) AMOUNTING TO RS.29,65,14,736/-. THE CASE OF THE ASSESSEE WAS PI CKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT WAS FRAMED VIDE ORDER DATED 26.02.2015. BY FRAMING THE ASSESSMENT, THE ASSESSING OFFICER MADE DISALLOWANCE OF DEPRECIATION ON INTANGIBLE ASSETS OF RS.7,11,35,236 /-; DISALLOWANCE OF ESIC CONTRIBUTION OF EMPLOYEES ON ACCOUNT OF DELAY IN PA YMENT OF RS.1,67,870/-; DISALLOWANCE OF DEPRECIATION ON ESTIMATED ASSETS OF RS.4,00,16,673/-; DISALLOWANCE OF DEPRECIATION ON SPARE PARTS OF RS.5 2,27,624/-; DISALLOWANCE OUT OF REPAIR AND MAINTENANCE OF VEHICLE OF RS.8,89 ,784/-; DISALLOWANCE OF LOSS ON SALE OF INVESTMENT OF RS.5,75,53,800/- AND ADDIT ION ON ACCOUNT OF INCOME FROM OTHER SOURCES OF RS.9,29,56,064/-. THUS, THE ASSESSING OFFICER COMPUTED THE BUSINESS INCOME AT RS.18,46,46,556/- AGAINST DE CLARED INCOME OF RS.10,26,11,633/-. FURTHER, THE ASSESSING OFFICER ASSESSED THE INCOME AT RS.9,29,92,233/- AND DIRECTED TO CHARGE TAX ON BOO K PROFIT U/S 115JB OF THE ACT AMOUNTING TO RS.29,65,14,740/-. 4. AGGRIEVED AGAINST THIS, THE ASSESSEE PREFERRED A PPEAL BEFORE LD.CIT(A) WHO AFTER CONSIDERING THE SUBMISSIONS, PARTLY ALLOW ED THE APPEAL. THEREBY, LD.CIT(A) DELETED THE ADDITION OF RS.7,11,35,236/- AND RS.4,00,16,673/- MADE ON ACCOUNT OF DISALLOWANCE OF DEPRECIATION ON INTAN GIBLE ASSETS AND DEPRECIATION ON ESTIMATED ASSETS. FURTHER, LD.CIT( A) IN RESPECT OF DEPRECIATION ITA NOS.3489/DEL/2017 & OTHERS 4 | P A GE ON SPARE PARTS, DISALLOWANCE ON ACCOUNT OF VEHICLE REPAIRS AND MAINTENANCE FOLLOWING THE EARLIER ORDER, ALLOWED THE CLAIM OF T HE ASSESSEE AND IN RESPECT OF THE LATE PAYMENT OF ESIC, WAS ALSO ALLOWED. IN SUB STANCE, LD.CIT(A) HAD ALLOWED THE APPEAL OF THE ASSESSEE. 5. AGGRIEVED AGAINST THIS, THE REVENUE HAS FILED TH E PRESENT APPEAL. 6. GROUND NOS.1 TO 4 RAISED BY THE REVENUE ARE AGAI NST THE DELETION OF ADDITION OF RS.7,11,35,236/- ON ACCOUNT OF DEPRECIA TION ON ACCOUNT INTANGIBLE ASSETS. 7. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE POIN TED OUT THAT THE ISSUES ARE COVERED AGAINST THE REVENUE BY THE DECISION OF THIS TRIBUNAL IN EARLIER YEARS. HE SUBMITTED THAT IN ITA NO.746/DEL/2011 RE LATING TO ASSESSMENT YEAR 2006-07 IN ASSESSEES OWN CASE WHEREIN THE ISSUES H AVE BEEN DECIDED IN FAVOUR OF THE ASSESSEE. 8. LD. SR. DR COULD NOT CONTROVERT THIS FACT THAT T HE ISSUE HAS BEEN DECIDED AGAINST THE REVENUE BY THE TRIBUNAL IN EARLIER YEAR S. 9. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE TRIBUNAL UNDER THE IDENTICAL FACTS IN ITA NO.4963/DEL/2015 FOR ASSESSMENT YEAR 2011-12 IN ASSESSEES OWN CASE HAS ALLOWED THE DEPRECIATION ON INTANGIBLE ASSETS BY OBSERVING AS U NDER:- 56. FOLLOWING THE DECISION RENDERED BY HON'BLE HIG H COURT AND COORDINATE BENCH OF THE TRIBUNAL DISCUSSED IN THE PRECEDING PA RAS, WHICH ARE SQUARELY APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE CONSIDERED VIEW THAT WHEN IN THE VALUATION REPO RT, WHICH IS GIVEN BY ITA NOS.3489/DEL/2017 & OTHERS 5 | P A GE PDIL, A GOVERNMENT OF INDIA UNDERTAKING, INTANGIBLE S ASSETS AND THEIR BENEFITS HAVE BEEN SPECIFICALLY VALUED AND THE ASSE SSEE HAD PAID A SUM OF RS.125 CRORES IN A SLUMP SALE AGREEMENT FOR APPROVA LS, LICENCES, PERMITS, REGISTRATION TO RUN THE BUSINESS OVER AND ABOVE THE TOTAL PRICE OF FERTILIZER PLANT I.E. RS.L,444 CRORES, THE SAME ARE INTANGIBLE S AND DEPRECATION THEREON IS ALLOWABLE U/S 32(L)(II) OF THE ACT APART FROM THE DEPRECIATION CLAIMED BY THE ASSESSEE ON TANGIBLE ASSETS. SO, FIN DING NO ILLEGALITY OR PERVERSITY IN THE FINDINGS RETURNED BY LD. CIT (A), GROUND NO.2 OF ITA NO.851/DEL/2011 (AY 2006-07) & ITA NO.852/DEL/2011 (AY 2007-08); GROUNDS NO.2 & 3 OF ITA NO.3569/DEL/20 11 (AY 2008- 09), GROUNDS NO.1 & 3 OF ITA NO.248/DEL/2014 (AY 2009-10) & ITA NO.56 16/DEL/2014 (ASSESSMENT YEAR 2010-11) AND GROUNDS NO.1 & 2 OF I TA NO.4963/DEL/2015 (AY 2011-12) OF REVENUE'S APPEALS ARE DETERMINED AGAINST THE REVENUE. THEREFORE, TAKING A CONSISTENT VIEW, WE DO NOT SEE ANY INFIRMITY INTO THE FINDING OF LD.CIT(A), THE SAME IS HEREBY AFFIRMED. GROUND NOS. 1 TO 4 RAISED BY THE REVENUE ARE THUS, DISMISSED AS REJECTED. 10. GROUND NO.5 RAISED BY THE REVENUE IS AGAINST T HE DELETION OF ADDITION OF RS.5,75,53,800/- ON ACCOUNT OF LOSS ON SALE OF INVE STMENT IN THE FORM OF FERTILIZERS BONDS. 11. LD. SR. DR SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND SUBMITTED THAT LD.CIT(A) WAS NOT JUSTIFIED IN DELETING THE AD DITION. 12. ON THE CONTRARY, LD. COUNSEL FOR THE ASSESSEE S UBMITTED THAT THE ISSUE IS ALSO DECIDED IN FAVOUR OF THE ASSESSEE. 13. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. LD.CIT(A) HAS DECIDED THE ISSUE BY OBS ERVING AS UNDER:- ITA NOS.3489/DEL/2017 & OTHERS 6 | P A GE 9.2. I HAVE CONSIDERED THE FACTS AND CIRCUMSTANCES OF THE CASE. ALTHOUGH THE FACTS RELATING TO WHY THE ADDITION WAS BEING MA DE DO NOT STAND DISCUSSED IN THE ASSESSMENT ORDER, IT IS UNDERSTOOD THAT THE APPELLANT IS IN THE BUSINESS OF MANUFACTURE OF FERTILIZERS WHICH IS REGULATED BY THE GOVT., IN THE SENSE, THAT THE SALE PRICE OF FERTILIZERS IS DECIDED BY GOVT., NORMALLY AT A SUBSIDY. THE APPELLANT IS GRANTED SUBSIDY TO C OMPENSATE THE LOSS ARISING OUT OF THE MANUFACTURE AND SALE OF FERTILIZ ERS AT LOWER THAN THE COST PRICE. THE FERTILIZERS BONDS HAVE BEEN ISSUED TO TH E APPELLANT BY THE GOVT. IN LIEU OF PAYMENT OF SUBSIDY. THE IMPUGNED BONDS W ERE REPURCHASED BY THE GOVT. IN 2 PHASES 50% OF BONDS IN FY 2010-11 AN D 50% IN FY 2011-12 TO THE RBI. THE PRICE OF SUCH BUYBACK WAS ALSO DECI DED BY THE GOVT. AS PER THE FORMULA PRESCRIBED. CONSEQUENTLY ON SUCH BUYBAC K BY GOVT. THE APPELLANT RECEIVED A VALUE LESS THAN THE PURCHASE V ALUE OF THE BOND. HAVING CONSIDERED THESE FACTS, IT IS CLEAR TO ME TH AT THE LOSS HAD BEEN INCURRED IN THE NORMAL COURSE OF BUSINESS AND IN TH E PROCESS OF COMPENSATION ACCRUED AND DUE TO THE APPELLANT VIS A VIS ITS MANUFACTURING ACTIVITIES. IT IS ALSO PERTINENT TO NOTE THAT THE L OSS HAS NOT BEEN DISALLOWED AS SUCH. ON THE OTHER HAND, THE LOSS HAD BEEN DISA LLOWED STATING THAT THE AMOUNT OF THE OF THE FERTILIZERS BONDS (SUBSIDY) HA VE BEEN AS A REVENUE RECEIPT IN THE RESPECTIVE AYS IN WHICH THEY WERE RE CEIVED, EITHER SEPARATELY AS REVENUE FROM OPERATIONS (SCHEDULE 2.22 OF THE AN NUAL REPORT FOR ASSESSMENT YEAR 2011-12) OR AS 'PRICE SUPPORT' INCL UDED IN THE SALES (NET OF DISCOUNTS/REBATES) IN THE FINANCIAL STATEMENTS F OR EARLIER YEARS. EFFECTIVELY, THEREFORE, THE FINAL AMOUNT RECEIVED O N SALE BACK OF GOVT. SUBSIDY /GOVT. BONDS IS A BUSINESS LOSS WHICH HAS T O BE REDUCED FROM THE DEBIT SITE OF THE P&L A/C. THE APPELLANT HAS COMPAR ED IT TO THE BAD DEBTS ON ACCOUNT OF LESSER REALIZATION TO OUTSTANDING DEB TORS, WITH WHICH I AM IN FULL AGREEMENT WITH. 9.3. THE LAW IS WELT SETTLED, THAT ANY PROFIT OR LO SS ARISING TO AN ASSESSEE ON A TRADING ASSET OR ON CIRCULATING CAPITAL, WOULD ORDINARILY BE TRADING PROFIT OR LOSS WHEREAS IF THE SAME IS INCURRED ON A CAPITAL ASSET OR ON FIXED CAPITAL, SUCH PROFIT OR LOSS WOULD BE OF CAPITAL NA TURE. THIS IS SETTLED JUDICIAL PROPOSITION AS PER THE SUPREME COURT DECIS ION IN THE CASE OF SUTLEJ ITA NOS.3489/DEL/2017 & OTHERS 7 | P A GE COTTON MILLS LTD. (116 ITR 1). AS HELD BY THE APEX COURT IN NUMBER OF DECISIONS, THE NATURE OF ANY SUBSIDY DEPENDS UPON T HE PURPOSE FOR WHICH IT WAS PAID/RECEIVED BY THE ASSESSEE AND IT IS THIS 'PURPOSE TEST THAT HOLDS THE KEY TO DECIDE WHETHER ANY LOSS INCURRED S UBSEQUENTLY ON SALE OF THE SAID GOVT. BONDS IS CAPITAL OR REVENUE IN NATUR E. THE SUPREME COURT IN THE CASE OF PONNI SUGARS &. CHEMICALS LTD. (306 ITR 392) HELD THE SUBSIDY IN THE FORM OF SALES TAX EXEMPTION, WATER TAX EXEMP TION ETC TO BE ON REVENUE ACCOUNT AS IT ENABLED THE' ASSESSEE TO CARR Y ON ITS BUSINESS MORE PROFITABLY AND COMPETITIVELY, WHEREAS IN THE CASE O F SAHNEY STEEL AND PRESS WORKS LTD. (228 ITR 253) THE SUBSIDY WAS PAID FOR REPAYMENT OF OUTSTANDING LOANS WHICH WERE CAPITAL IN NATURE AND HENCE IT WAS HELD TO BE THE CAPITAL RECEIPT. WE FIND THAT THE LD.CIT(A) HAS RECORDED A FINDING ON FACT THAT THE AMOUNT OF THE FERTILIZERS BONDS (SUBSIDY) HAS BEEN DECLARE D AS A REVENUE RECEIPT IN THE RESPECTIVE ASSESSMENT YEARS. THIS FINDING ON FACTS IS NOT REBUTTED BY REVENUE BY PLACING ANY CONTRARY MATERIAL. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE IN THE FINDING OF LD.CIT(A). GROUND NO.5 RAISED BY THE REVENUE IS THUS, DISMISSED. 14. NOW, WE TAKE UP ITA NO.3490/DEL/2017 [ASSESSMENT YEAR 2013-14] WHEREIN THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL:- 1. 'LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELE TING THE ADDITION OF RS.5,33,51,427/- BEING DEPRECIATION ON INTANGIBLE A SSETS WHILE RELYING ON THE APPELLATE ORDERS OF HER PREDECESSORS, WHICH HAV E NOT BEEN ACCEPTED BY DEPARTMENT AND THE DEPARTMENTAL APPEALS ARE PENDING BEFORE HON'BLE ITAT. 2. LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELE TING THE ADDITION OF RS.5,33,51,427/- BEING DEPRECIATION ON INTANGIBLE A SSETS WITHOUT ITA NOS.3489/DEL/2017 & OTHERS 8 | P A GE APPRECIATING THE FACT THAT THE ASSESSEE HAS FAILED TO FURNISH VALUATION OF THE INTANGIBLE ASSETS AND SUBSTANTIATE THE SAME. 3. LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELET ING THE ADDITION ON ACCOUNT OF DISALLOWANCE OF DEPRECIATION OF RS.5,33, 51,427/- ON THE BLOCK OF INTANGIBLE ASSETS WITHOUT APPRECIATING THAT THE VAL UATION OF INTANGIBLE ASSETS OF 1246.69 CRORE OUT OF TOTAL CONSIDERATION OF RS.1908 CRORE IS ON ACCOUNT OF GOING CONCERN BESIDES VALUATION OF FIXED ASSETS I.E. BUILDING PLANT AND MACHINERY. 5. LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELET ING THE ADDITION OF RS.5,33,51 ,427/- BEING DEPRECIATION ON INTANGIBLE ASSETS CLAIMED IN THE FORM OF GAS PRICE RIGHTS, LOCATIONAL BENEFITS OF PR ESENT AND FUTURE PRODUCTS AND TRAINED MANPOWER WITHOUT APPRECIATING THAT GAS PRICE AND PRODUCTS ARE UNDER GOVERNMENT CONTROL FOR WHICH NO INTANGIBLE ASSETS CAN BE CREATED AND THE ASSESSEE COMPANY IS ALREADY CLAI MING SALARY AND WAGES OF SKILLED MANPOWER THUS CLAIMING DOUBLE DEDU CTION FOR THE SAME SKILLED MANPOWER CLAIMED AS INTANGIBLE ASSETS AS WE LL AS DEPRECIATION. 5. 'THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR FOREGO ANY GROUND(S) OF THE APPEAL RAISED ABOVE AT THE TIME OF HEARING.' 15. THE ONLY EFFECTIVE GROUND IS AGAINST THE ALLOWA NCE OF DEPRECIATION ON INTANGIBLE ASSETS OF RS.5,33,51,427/-. 16. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SU BMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F THE TRIBUNAL IN EARLIER YEARS. 17. LD. SR. DR COULD NOT CONTROVERT THESE FACTS. 18. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. SIMILAR ISSUE WAS DECIDED IN ITA NO.34 89/DEL/2017 PERTAINING TO ASSESSMENT YEAR 2012-13 WHEREIN THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ITA NOS.3489/DEL/2017 & OTHERS 9 | P A GE ASSESSEE BY THE TRIBUNAL BY FOLLOWING THE ORDERS OF EARLIER YEARS. WE, THEREFORE, DO NOT SEE ANY INFIRMITY IN THE ORDER OF LD.CIT(A), THE SAME IS HEREBY AFFIRMED. GROUNDS RAISED BY THE REVENUE IN THIS APPEAL ARE TH US, DISMISSED. 19. NOW, WE TAKE UP ITA NO.6100/DEL/2017 [ASSESSMENT YEAR 2014-15] WHEREIN THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL:- (1) THAT ON THE FACTS & IN THE CIRCUMSTANCES OF TH E CASE & IN LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION ON ACC OUNT OF DISALLOWANCE OF DEPRECIATION ON INTANGIBLE ASSETS OF RS.4,00,13,570 /- BY MERELY RELYING ON THE ORDERS OF PREDECESSORS, WHICH HAVE NOT BEEN ACC EPTED BY DEPARTMENT AND THE APPEAL OF DEPARTMENT IS PENDING BEFORE ITAT . (2) THAT ON THE FACTS & IN THE CIRCUMSTANCES OF TH E CASE & IN LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION ON ACC OUNT OF DISALLOWANCE OF DEPRECIATION CLAIMED ON INTANGIBLE ASSETS WHEN ASSE SSEE FAILED TO ESTABLISH THAT THE INTANGIBLE ASSETS LIKE LICENSES HAD NOT OUTLIVED THEIR IMPORTANCE. (3) THAT ON THE FACTS & IN THE CIRCUMSTANCES OF TH E CASE & IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION ON AC COUNT OF DISALLOWANCE OF DEPRECIATION ON ESTIMATED ASSETS OF RS.2,89,12,046/ - AND NOT APPRECIATING THE FACT THAT THE ASSESSEE WAS CLAIMING DEPRECIATIO N ON THE INTANGIBLES ACQUIRED IN THE PURCHASE, HOWEVER NO INTANGIBLES WE RE SPECIFICALLY IDENTIFIED AND VALUED. (4) THAT ON THE FACTS & IN THE CIRCUMSTANCES OF TH E CASE & IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION ON AC COUNT OF DISALLOWANCE OF DEPRECIATION ON SPARE MACHINERY PARTS OF RS.37,76,9 59/-WITHOUT APPRECIATING THE FACT THAT THE PLANT AND MACHINERY HAD NOT BEEN PUT TO USE AND ASSESSEE DID NOT PROVIDE ANY DETAILS WITH REGAR DS TO THE SAME. (5) THAT ON THE FACTS & IN THE CIRCUMSTANCES OF TH E CASE & IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION ON AC COUNT OF DISALLOWANCE OF EXPENSES ON VEHICLE REPAIR & MAINTENANCE OF RS.10,0 9,679/-, WHEN THIS ITA NOS.3489/DEL/2017 & OTHERS 10 | P A GE AMOUNT OF EXPENDITURE COULD NOT BE SUPPORTED BY THE VEHICLE SHOWN IN FIXED ASSET SCHEDULE. (6) THAT THE ORDER OF THE LD. CIT(A) IS ERRONEOUS AND IS NOT TENABLE ON FACTS AND IN LAW. (7) THAT THE GROUNDS OF APPEAL ARE WITHOUT PREJUDI CE TO EACH OTHER. (8) THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR FOREGO ANY GROUND(S) OF THE APPEAL RAISED ABOVE AT THE TIME OF HEARING. 20. GROUND NOS. 1 TO 3 RAISED BY THE REVENUE ON ACC OUNT OF DISALLOWANCE OF DEPRECIATION ON INTANGIBLE ASSETS OF RS.4,00,13,570 /-. 21. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUB MITTED THAT THE ISSUES RAISED IN THIS APPEAL ARE COVERED BY THE ORDERS OF TRIBUNAL PASSED IN EARLIER YEARS. 22. LD. SR. DR COULD NOT CONTROVERT THIS FACT. 23. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT SIMILAR ISSUES HAVE BEEN RAISED IN EARLIER YEARS ALSO. THE TRIBUNAL VIDE CONSOLIDATED ORDER IN ITA NOS. 85 2/DEL/2011 [ASSESSMENT YEAR 2007-08] & 3569/DEL/2011 [ASSESSMENT YEAR 2008 -09], DECIDED THE SAME IN FAVOUR OF THE ASSESSEE. THE REVENUE HAS NOT POI NTED OUT ANY CHANGE INTO FACTS AND CIRCUMSTANCES OF THE CASE. GROUND NOS. 1 TO 3 RAISED BY THE REVENUE ARE THUS, DISMISSED. 24. GROUND NO.4 RAISED BY THE REVENUE IS AGAINST TH E DISALLOWANCE MADE ON ACCOUNT OF DISALLOWANCE ON DEPRECIATION ON SPARE MA CHINERY PARTS OF RS.37,76,959/-. ITA NOS.3489/DEL/2017 & OTHERS 11 | P A GE 25. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUB MITTED THAT THIS ISSUE IS ALSO COVERED BY THE ORDERS OF TRIBUNAL PASSED IN EA RLIER YEARS. 26. LD. SR. DR COULD NOT CONTROVERT THE SUBMISSIONS OF THE LD. COUNSEL FOR THE ASSESSEE. HOWEVER, HE RELIED UPON THE ASSESSME NT ORDER. 27. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE IDENTICAL ISSUES RAISED IN ITA NO.24 8/DEL/2014 [ASSESSMENT YEAR 2009-10]. THE TRIBUNAL IN PARA 18 DECIDED THE ISSUE BY OBSERVING AS UNDER:- 18. SO, FOLLOWING THE DECISION RENDERED BY HON'BL E DELHI HIGH COURT IN CIT VS. INSILCO LIMITED (SUPRA), WE ARE OF THE CONS IDERED VIEW THAT THE LD. CIT (A) HAS ERRED IN DISALLOWING THE CLAIM OF THE A SSESSEE ON ACCOUNT OF DEPRECATION ON CAPITAL SPARES DURING AYS 2006-07, 2 007-08 & 2008-09, HENCE AO IS DIRECTED TO ALLOW THE SAME AFTER DUE VE RIFICATION OF CAPITAL SPARES PURCHASED DURING THE YEAR UNDER ASSESSMENT. SO, GROUND NO.4 IN ITA NO.764/DEI/2011 (AY 2006-07), GROUND NO.2 IN IT A NO.765/DEL/2011 (AY 2007-08) AND GROUND NO.1 IN ITA NO. 3508/DEL/20 11 (AY 2008-09) IN ASSESSEE'S APPEALS ARE DETERMINED IN FAVOUR OF THE ASSESSEE. THE REVENUE HAS NOT POINTED OUT ANY CHANGE INTO FAC TS AND CIRCUMSTANCES OF THE CASE. GROUND NO. 4 RAISED BY T HE REVENUE IS THUS, DISMISSED. 28. GROUND NO.5 RAISED BY THE REVENUE IS AGAINST TH E DISALLOWANCE OF EXPENSES ON VEHICLE REPAIR AND MAINTENANCE OF RS.10 ,09,679/-. 29. LD. SR. DR RELIED UPON THE ASSESSMENT ORDER AND SUBMITTED THAT LD.CIT(A) WAS NOT JUSTIFIED IN DELETING THE ADDITIO NS. ITA NOS.3489/DEL/2017 & OTHERS 12 | P A GE 30. PER CONTRA, LD. COUNSEL FOR THE ASSESSEE SUBMIT TED THAT THE EXPENDITURE HAS BEEN MADE PURELY ON THE ADHOC BASIS AND HAS BEE N RIGHTLY DELETED BY LD.CIT(A). 31. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT LD.CIT(A) HAS FOLLOWED THE EARLIER YEARS ORDERS AND COUPLED WITH THE FACT THAT THE DISALLOWANCES ARE MA DE PURELY ON ADHOC BASIS. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE IN THE FINDING OF LD.CIT(A), THE SAME IS HEREBY REJECTED. GROUND NO. 5 RAISED BY THE REVENUE IS THUS, DISMISSED. 32. IN THE RESULT, ALL APPEALS FILED BY THE REVENUE ARE DISMISSED. ABOVE DECISION WAS PRONOUNCED ON CONCLUSION OF VIRT UAL HEARING IN THE PRESENCE OF BOTH THE PARTIES ON 30 TH SEPTEMBER, 2021. SD/- SD/- (DR. B.R.R.KUMAR) (KUL BHARAT) ACCOUNTANT MEMBER JUDICIA L MEMBER *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI