ACIT 20(1), MUMBAI V. CHIRAG DESIGN, MUMBAI

ITA 3541/MUM/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 9157 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 31-10-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 04-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A B KOLI
• Assessee Lawyers: B V JHAVERI
• Keywords: Sale consideration of property below Jantri Value; Business income; Onus to prove; Revenue expenditure
• Section: 50C

Judgement Text

CHIRAG DESIGN 3494/2011 3541/2011 1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH C, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBER ITA NO. 3494/MUM/2011 (ASSESSMENT YEAR: 2007-08) M/S. CHIRAG DESIGN, 1001, KHENI TOWER, JOGANI COMPLEX, CTS ROAD, OPP REHAJA CENTRE POINT, KALINA, SANTACRUZ (EAST), MUMBAI - 400 098 VS ADDL COMMISSIONER OF INCOME-TAX -20(1), 4 TH FLOOR, PIRAMAL CHAMBERS, LALBAUGH, MUMBAI -400 012 (APPELLANT) (RESPONDENT) ITA NO. 3541/MUM/2011 (ASSESSMENT YEAR: 2007-08) ADDL COMMISSIONER OF INCOME- TAX -20(1), MUMBAI -400 012 VS M/S. CHIRAG DESIGN, MUMBAI -400 098 PAN AACFD 0948 C (APPELLANT) (RESPONDENT) APPELLANT-ASSESSEE BY : SHRI B V JHAVERI RESPONDENT-REVENUE BY : SHRI A B KOLI DATE OF HEARING: 31.10.2012 DATE OF PRONOUNCEMENT: 07.12.2012 O R D E R PER VIVEK VARMA, JM: THE CROSS APPEALS HAVE BEEN FILED BY THE ASSESSEE A ND THE DEPARTMENT AGAINST THE ORDER OF CIT(A) 31, MUMBAI, DATED, 28.0 2.2011. SINCE BOTH THE APPEALS EMANATE FROM THE SAME ORDER, WE, THEREFORE, FOR THE SAKE OF CONVENIENCE AND BREVITY, DISPOSE OFF THE TWO APPEAL VIDE COMMON AND CONSOLIDATED ORDER. ITA NO. 3494 OF 2011 - ASSESSEES APPEAL CHIRAG DESIGN 3494/2011 3541/2011 2 2. THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE AS SESSEE : ' 1. THE COMMISSIONER (APPEALS) ERRED IN HOLDING THAT DEPOSITS TO MIDC, BSES, BMC AND GAS AUTHORITY AGGREGATING TO RS. 2,17,668/- , LICENSE FEES PAID OF RS. 1,13,320/-, PREPAID EXPENSES OF RS. 31,250/- AND PR OPERLY TAX PAID IN ADVANCE OF RS.69,07,946/- (ALL AGGREGATING TO RS. 72,60,184/-) DO NOT FORM PART OF THE COST OF THE INDUSTRIAL GALAS FOR THE PURPOSE OF DETERMIN ING THE SHORT-TERM CAPITAL GAINS U/S. 50 OF THE ACT ON SALE OF INDUSTRIAL GALA S. 2. THE COMMISSIONER (APPEALS) FAILED TO APPRECIATE THAT MIDC DEPOSIT OF RS. 57,557/-, BSES DEPOSIT OF RS. 81,191/-, BMC SECURIT Y DEPOSIT OF RS. 65,800/-, DEPOSIT WITH GAS AUTHORITY OF RS. 13,100/-, LICENSE FEES OF RS. 1,13,320/-, PREPAID EXPENSES OF RS. 31,250/- AND THE PROPERTY TAX PAID IN ADVANCE OF RS. 69,07,946/- WERE INEXTRICABLY CONNECTED WITH THE INDUSTRIAL GAL AS AND THEREAFTER THESE DEPOSITS AND EXPENSES HAVE GONE ALONG WITH THE SAID GALAS AND HENCE THESE DEPOSITS AND EXPENSES NEED TO BE CONSIDERED WHILE D ETERMINING THE SHORT-TERM CAPITAL GAINS ON SALE OF THE INDUSTRIAL GALAS. 3. THE COMMISSIONER (APPEALS) FAILED TO APPRECIATE THAT IF THE DEPOSITS AND EXPENSES ARE NOT TREATED AS A PART OF THE COST OF T HE INDUSTRIAL GALAS, IN SUCH CIRCUMSTANCES THESE DEPOSITS AND EXPENSES WILL HAVE TO BE ALLOWED AS BUSINESS LOSS AS THESE DEPOSITS AND EXPENSES PAID IN ADVANCE ARE REQUIRED TO BE ALLOWED AS REVENUE EXPENSES ON CLOSURE OF THE UNIT IN SEEPZ . 4. THE COMMISSIONER (APPEALS) ERRED IN NOT ALLOWING WRITE OFF OF THE WRITTEN DOWN VALUE OF THE SAFES OF RS. 23,790/-, OF COMPUTE R CPU FOR JEWELLERY MANUFACTURING PROGRAMME OF RS. 1,39,379/- AND OF OF FICE EQUIPMENTS I.E., NETWORKING OF TELEPHONE CONNECTIONS OF SYSTEM, VIDE O MONITORING SYSTEM AND NETWORKING SYSTEM OF COMPUTERS OF RS. 14,70,913/- I N FOUR GALAS ADMEASURING 26,161 SQ. FT. OF THE GALAS. 5. THE COMMISSIONER (APPEALS) FAILED TO APPRECIATE THAT ON SALE OF ALL THE INDUSTRIAL GALAS AND CLOSURE OF THE BUSINESS IN SEE PZ THE WDV OF SAFE, COMPUTER CPU AND NETWORKING SYSTEMS HAD BECOME USELESS AND T HEREFORE, THE ASSESSEE FIRM DID NOR REMOVE THE SAME BUT TRANSFERRED THEM T O THE PURCHASERS ALONG WITH THE GALAS AND HENCE THE WDV OF THESE ITEMS NEED TO B E TAKEN INTO CONSIDERATION WHILE COMPUTING SHORT-TERM CAPITAL GAINS ON SALE OF THE GALAS. 6. THE COMMISSIONER (APPEALS) ERRED IN TREATING 50% OF THE WRITTEN DOWN VALUE OF THE FURNITURE AND FIXTURES I.E., RS. 44,36,456/ - (BEING 50% OF RS. 88,72,912/-) AS NOT FORMING PART OF THE INDUSTRIAL GALAS WHILE C OMPUTING THE SHORT-TERM CAPITAL GAINS ON SALE OF THE GALAS. 7. THE COMMISSIONER (APPEALS) FAILED TO APPRECIATE THAT ALL THE FURNITURE AND FIXTURES INCLUDING CABINS, PARTITIONS, GLASS PARTI TIONS, CABINETS, TABLES, CHAIRS, ETC. WERE MADE AS PER THE REQUIREMENTS AND TO SUIT THE P REMISES IN WHICH THEY WERE USED AND THEREFORE, THEY WERE INTRINSICALLY ATTACHE D TO THE PREMISES AND HENCE THE SAME WERE LYING IN THE INDUSTRIAL GALAS WHICH H AVE BEEN SOLD BY THE ASSESSEE FIRM AND HENCE THE SAME OUGHT TO HAVE BEEN CONSIDER ED WHILE COMPUTING SHORT- TERM CAPITAL GAINS. 8. THE COMMISSIONER (APPEALS) FAILED TO APPRECIATE THAT THESE IS NO EVIDENCE ON RECORD THAT THE ASSESSEE FIRM HAS SOLD ANY PART OF THE FURNITURE AND FIXTURES SEPARATELY AND THEREFORE, THE SAME IS DISCARDED ON CLOSURE OF THE UNIT IN SEEPZ CHIRAG DESIGN 3494/2011 3541/2011 3 AND THEREFORE, THE SAID WRITE OFF OF THE WDV OF THE FURNITURE AND FIXTURES IS REQUIRED TO BE ALLOWED AS SHORT-TERM CAPITAL LOSS.' 3. THE FACTS AS EMANATING FROM THE ORDERS OF THE RE VENUE AUTHORITIES ARE THAT THE ASSESSEE FIRM IS IN THE BUSINESS OF MANUFA CTURE AND EXPORT OF STUDDED GOLD, PLATINUM JEWELLERY, PALLADIUM, SILVER AND GOLD JEWELLERY. IN THE CURRENT YEAR, THE ASSESSEE SOLD THE ENTIRE MANUFACT URING FACILITY BELONGING TO IT, LOCATED AT SEEPZ, MUMBAI, BEARING GALAS NO. 601 & 602 AND 603 & 604 TO DANIA ORO JEWELLERY PVT. LTD. (DANIA) AND YASH JEWE LLERY PVT. LTD. (YASH) FOR A TOTAL CONSIDERATION OF RS. 8,93,32,286. IN THE RE TURN OF INCOME, THE ASSESSEE DECALRED NET CAPITAL GAINS AT RS. 2,06,67,083. THIS WAS THE RESIDUE OF SALE CONSIDERATION AT RS. 8,93,32,286 MINUS WDV AT RS. 6 ,14,05,018 ON ALL ASSETS AND DEPOSITS WITH VARIOUS GOVERNMENT DEPARTMENTS AT RS. 72,60,184. 4. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO CALLED FOR THE DETAILED BREAK UP OF THE CLAIM OF CAPITAL GAINS AT RS. 2,06, 67,083. IN THE REPLY TO THIS QUERY FROM THE AO, THE ASSESSEE VIDE LETTER DATED 2 7.11.2009, SUBMITTED (EXTRACTED) : THE ASSESSEE IS A PARTNERSHIP FIRM WHICH WAS CARRY ING ON THE BUSINES OF MANUFACTURING AND EXPORTING JEWELLERY FROM ITS FACT ORY AT SEEPZ. THE ASSESSEE FIRM HAD TAKEN ON LEASE FROM SEEPZ AUTHORITIES, FOU R INDUSTRIAL GLAS BEARING GALA NOS. 601 602 603 AND 604 IN SEEPZ AT ANDHERI (EAST), MUMBAI. THE ASSESSEE FIRM FURNISHED THE SAID PREMISES AND VARIO US EQUIPMENTS AND FITTINGS AND FIXTURES INCLUDING THE OFFICE EQUIPMENTS WERE INSTALLED. THE ASSESSEE FIRM ALSO GOT INSTALLED THE GAS PIPELINE FOR THE PURPOSE OF MANUFACTURING JEWELLERY. THE WRITTEN DOWN VALUE OF THE SAID INDUSTRIAL GALS, FURNITURE AND FIXTURES THEREIN AND MACHINERY AND OFFICE EQUIPMENTS AS ON 1.4.2006 WAS AS UNDER: SR. NO. ITEM AMOUNT (RS) 1 FACTORY GALAS 4,83,42,827 2 FURNITURE &FIXTURES 88,72,912 3 COMPUTERS 1,39,379 4 SAFES 23,290 5 ELECTRIC FITTINGS 25,06,696 6 OFFICE EQUIPMENTS 1,47,913 7 GAS PIPELINES 49,001 TOTAL 6,14,05,018 CHIRAG DESIGN 3494/2011 3541/2011 4 2. THE SAID INDUSTRIAL GALAS ALONG WITH THE AFORESA ID FURNITURE, FIXTURES, OFFICE EQUIPMENTS, ELEECTRIC FITTINGS, ETC. WHICH ARE ATTA CHED TO THE PREMISES AND WHICH COULD NOT BE REMOVED AND TAKEN AWAY, WERE TRANSFERR ED UNDER TWO SUB LEASES DATED 19TH OCTOBER, 2007 TO M/S DANIA ORO JEWELLERY PVT. LTD. AND M/S YASH JEWELLERY PVT. LTD. FOR THE CONSIDERATION OF RS. 4,3 8,40,522/- AND RS. 4,51,57,934/-. 3. ON SALE OF THE AFORESAID INDUSTRIAL GAIA WITH FU RNITURE, FIXTURES, OFFICE EQUIPMENTS, ELECTRIC FITTINGS, ETC., THE ASSESSEE F IRM HAS COMPUTED THE SHORT TERM CAPITAL GAINS AS UNDER: WDV OF PREMISES, FURNITURE, EQUIPMENT, ELECTRIC FITTINGS, ETC. RS. 6,14,05,018 ADD: DEPOSITS &EXPENSES IN RESPECT OF PREMISES AS UNDER:- A) MIDC DEPOSITS RS.57,577 B) BSES DEPOSITS RS.81,191 C) BMC SECURITY DEPOSITS RS.65,800 D) GAS DEPOSITS RS.13,100 E) LICENCE FEES RS.1,13,320 F) PREPAID EXPENSES RS.31,250 G) PROPERTY TAX ADVANCES RS.69,07,94 6 RS.72,60,184 RS. 6,86,65,202 LESS: CONSIDERATION RECEIVED FROM M/S DANIA ORO JEWELLERY P. LTD. &M/S YASH JEWELLERY PVT.LTD. (4,38,40,522 + 45,15,793 +3,33,830) RS. 8,93,32,286 SHORT TERM CAPITAL GAINS RS. 2,06,67,084 4. IN THIS RESPECT IT IS SUBMITTED THAT FURNITURE, FIX TURES, OFFICE EQUIPMENTS, ELECTRIC FITTINGS, GAS PIPELINE, ETC., WHICH WERE A TTACHED TO THE PREMISES AND WHICH, IF REMOVED, WOULD LOSE ITS VALUE, WERE TRANS FERRED ALONG WITH THE PREMISES AND THEREFORE, THE WDV OF THE PREMISES, AL ONG WITH THESE ASSETS WERE TAKEN TOGETHER FOR THE PURPOSE OF ASCERTAINING THE SHORT TERM CAPITAL GAINS. SECONDLY, IN THE ALTERNATIVE. FURNITURE, FIXTURES, FITTINGS, EQUIPMENTS, GAS PIPELINE WHICH WERE ATTACHED TO THE AFORESAID INDUS TRIAL GALAS ARE REQUIRED TO BE ALLOWED AS SHORT TERM CAPITAL LOSS AS THEY W ERE FORMING PART OF THE BLOCK OF ASSETS WHICH HAVE BEEN WIPED OUT ON SALE O F THE INDUSTRIAL GALAS. THEREFORE, THE SAID SHORT TERM CAPITAL LOSS IS REQU IRED TO BE ALLOWED AGAINST THE SHORT TERM CAPITAL GAINS EARNED BY THE ASSESSEE ON SALE OF THE INDUSTRIAL GALAS. THIRDLY , VARIOUS DEPOSITS GIVEN IN RESPECT OF THE BUSINESS BEING CARRIED ON FROM THE SAID PREMISES ARE ALSO ADDED TO THE WRITTE N DOWN VALUE OF THE PREMISES WITH THESE ASSETS WHITE ASCERTAINING THE S HORT TERM CAPITAL GAINS. IT IS SUBMITTED THAT THE ASSESSEE FIRM HAD TRANSFER RED ITS MIDC DEPOSITS, BMC SECURITY DEPOSITS, GAS DEPOSIT, PREPAID EXPENSE S, LICENSE FEE AND ADVANCE PAYMENT OF PROPERTY TAX ALONG WITH THE PREM ISES BECAUSE THEY CANNOT BE SEPARATED OR RECEIVED BACK BY THE ASSESSE E FIRM. IN THIS RESPECT CHIRAG DESIGN 3494/2011 3541/2011 5 YOUR KIND ATTENTION IS INVITED TO THE CONFIRMATIONS OF BOTH THE PURCHASERS OF GALAS WHEREIN THEY HAVE CONFIRMED THAT THEY PURCHAS E THE GALS FROM THE ASSESSEE FIRM ALONG WITH FURNITURE, FIXTURES, ELECT RIC FITTINGS, OFFICE EQUIPMENTS, GAS PIPELINE, ETC. AND ALSO WITH THE DE POSITS GIVEN TO VARIOUS AUTHORITIES AS LISTED HEREINABOVE EXHIBIT B-1 AND B-2 FOURTHLY, PROPERTY TAX ADVANCES AMOUNTING TO RS. 69,07,946/- HAD NOT BEEN CLAIMED AS REVENUE EXPENDITURE BY THE ASSESSEE FIRM. THEREFORE, IF THE AFORESAID PROPERLY TAX ADVANCES ARE NOT TREATED AS PART OF THE COST OF THE INDUSTRIAL GALAS SOLD BY THE ASSESSEE, IN SUCH CIRCUMSTANCES THE SAID EXPENDITURE INCURRED IN THE COURSE OF THE BUSINESS SHOULD BE ALLOWED AS REVENUE EXPENDITURE OF THE YEAR UNDER CONSIDERATION THIS INSTANCE PROVES THAT THE MARKET VALUE DETERMIN ED BY THE STAMP DUTY AUTHORITIES IS INCORRECT IN AS MUCH AS EVEN AFTER A PERIOD OF ONE YEAR I.E IN THE MONTH OF OCTOBER, 2008, THE STAMP DUTY AUTHORIT Y HAS VALUED THE GALAS IN THE SAME BUILDING AT A LESSER FIGURE PER SQ. FL. IN COMPARISON TO THE MARKET VALUE ADOPTED BY THE STAMP DUTY AUTHORITY I N THE MONTH OF OCTOBER, 2007 (EVEN READY RECKONER IS NOT FOLLOWED) . IT IS, THEREFORE, SUBMITTED THAT THE VALUATION MADE BY THE STAMP DUTY AUTHORITIES SHOULD NOT BE CONSIDERED FOR THE PURPOSE OF COMPUTING CAPI TAL GAINS IN THE HANDS OF THE ASSESSEE FIRM. INSTEAD OF THAT THE READY REC KONER OF THE RESPECTIVE YEAR SHOULD BE CONSIDERED AND ADOPTED FOR THE PURPO SE OF DETERMINING THE MARKET VALUE. 5. THE SUM AND SUBSTANCE OF THE SUBMISSIONS MAD E BY THE ASSESSEE BEFORE THE AO, WERE, (I) THE COST OF GALAS AT RS. 6,80,65,202 AND SALE CONS IDERATION OF GALAS AT RS. 8,93,32,268 SHOULD BE ADOPTED, (II) THE WDV ON THE OTHER BLOCK OF ASSETS SHOULD BE INCLUDED IN THE COST OF T HE GALAS AND (III) DEPOSITS OF RS. 72,60,184, MADE BY THE ASSESSEE TO THE VARIOUS GOVERNMENT DEPARTMENTS SHOULD BE INCLUDED IN COSTS OF THE GALAS, OR, ALTER NATIVELY, THESE DEPOSITS BE ALLOWED AS BUSINESS LOSS. 6. THE AO CONSIDERED THE SUBMISSIONS MADE BY THE AS SESSEE, WHEREIN THE ASSESSEE HAD TAKEN ITS ASSETS IN THE CHART SHOWING WDV ON ASSETS AS : ELECTRIC FITTINGS 25,06,695 FACTORY SHEDS 4,83,42,826 FURNITURE &FIXTURES 88,96,206 GAS PIPE LINES 49,001 7. THE AO CONCLUDED THAT SINCE THE ASSESSEE ITS ELF HAS GONE ON THE WDV ON DIFFERENT ASSETS SEPARATELY AND SEQUENTIALLY, TH ERE WAS NO REASON WHY THE CHIRAG DESIGN 3494/2011 3541/2011 6 VALUES OF THE OTHER ASSETS TO NOT TO BE EXCLUDED. H E, THEREFORE, EXCLUDED THE VALUES OF OTHER ASSETS AND ARRIVED AT THE CAPITAL G AINS AT : MARKET VALUE AS PER REVENUE AUTHORITIES 11,20,81,000 LESS : CONSIDERATION RECEIVED BY THE ASSESSES 4,83,42,826 GAIN ON SALE 6,37,38,174 8. THE AO THUS, BASED ON THE ABOVE WORKING, DID NOT AGREE WITH THE SUBMISSIONS MADE BY THE ASSESSEE AND EXAMINED THE T WO SALES, WITH REFERENCE TO SECTION 50C AND ARRIVED AT THE FIGURES OF RS. 5, 37,64,000 FOR GALAS NO. 601 & 602, AND RS. 5,83,17,000 FOR GALAS NO. 603 & 604, A GGREGATING TO RS. 11,20,81,000. HE, REDUCED FROM THE AMOUNT SO ARRIVE D AT BY THE ASSESSEE, THE WDV ON GALAS (FACTORY SHED) AT RS. 4,83,42,826 AND COMPUTED THE CAPITAL GAINS AT RS. 6,37,38,174 AND TREATED THE SAME AS ST CG. THE AO, FINALLY TAXED NOT ONLY THE STCG ALREADY DECLARED BY THE ASSESSEE AT RS. 2,06,67,083 BUT ALSO BROUGHT TO TAX RS. 4,30,71,091 ADDITIONALLY. IN THE PROCESS, HE ALSO DID NOT ALLOW THE DEPOSITS AT RS. 72,60,184 AND WDV ON OTHER B LOCKS TO BE INCLUDED TO THE COST, FOR THE PURPOSES OF ARRIVING AT THE SHORT TERM CAPITAL GAINS OF RS. 6,37,38,174. 9. AGGRIEVED, THE ASSESSEE APPROACHED THE CIT(A), B EFORE WHOM THE ASSESSEE MADE VARIOUS SUBMISSIONS. THE ASSESSEE CON TESTED THE DECISIONS OF THE AO IN NOT GRANTING RELIEF TO THE ASSESSEE WITH RESPECT TO (I) WDV ON OTHER ASSETS AND (II) DEPOSITS OF RS. 72,60,184. ON CONSIDERING THE ASSE SSEES SUBMISSIONS, THE CIT(A) GRANTED FULL RELIEF WITH RESPECT TO THE WDV ON ELEC TRIC FITTINGS AND GAS FITTINGS AND PART RELIEF AT 50% ON THE WDV ON FURNITURE AND FIXTURES. REGARDING WDV ON THE REST OF THE OTHER BLOCKS AND DEPOSITS, THE C IT(A) CONFIRMED THE DECISION OF THE AO. CONTENTS OF PARAS 3.3.6, 3.3.7, 3.3.8 AND 3.3.9 OF THE IMPUGNED ORDER ARE RELEVANT AND ARE EXTRACTED AS UNDER : 3.3.6 REGARDING, THE CONTENTION OF THE APPELLANT TH AT THE DEPOSITS MADE THE STATE/CENTRAL GOVERNMENT, PREPAID EXPENSES AND ADVANCE PROPERTY TAX PAID MAY BE CONSIDERED AS PART OF THE WDV ON T RANSFER OF INDUSTRIAL CHIRAG DESIGN 3494/2011 3541/2011 7 UNITS, TO MY CONSIDERED OPINION IS MISPLACED AND OU T OF CONTEXT. ON PERUSAL OF THE SUB LEASE DEEDS EXECUTED BY THE APPELLANT AS A CONFIRMING PARTY, I FIND NO SUCH CLAUSE OR TERMS AND CONDITIONS MENTION ED THEREIN, AS CONTESTED BY THE AR. THE PAYMENT RECEIVED BY THE AP PELLANT AS SALES CONSIDERATION IS ONLY TOWARDS SALE OF THE INDUSTRIA L UNITS IN ITS PHYSICAL FORM WITHOUT INCLUDING THE AMOUNT OF DEPOSITS, PREP AID EXPENSES AND ADVANCE PROPERTY TAX PAID. NO ANNEXURES ARE FOUND PREPARED SPECIFYING THE CLAIM OF THE APPELLANT AND NO SUCH TERMS AND CO NDITIONS THAT THESE DEPOSITS, PREPAID EXPENSES AND ADVANCE PROPERTY TAX PAID ARE PART OF THE TOTAL SALES CONSIDERATION, IS FOUND RECORDED IN THE SE SUB LEASE DEEDS EXECUTED BY THE APPELLANT. THEREFORE, THE SUBMISSIO N OF THE APPELLANT ON BARE FACTS OF THE CASE IS FOUND UNREASONABLE AND UN JUSTIFIED. THEREFORE, THE SAME IS OUT RIGHTLY REJECTED. ACCORDINGLY, THE AO I S DIRECTED NOT TO CONSIDER THE BOOK VALUE OF THESE DEPOSITS, PREPAID EXPENSES, AND ADVANCE PROPERTY TAX PAID AGGREGATING TO RS. 72,60,1841- FOR THE PUR POSE OF COMPUTATION OF DEEMED SHORT TERM CAPITAL GAIN ON SALE OF INDUSTRIA L UNITS U/S 50 OF THE ACT. THE ENTIRE ADDITION MADE ON THIS ACCOUNT IS THEREFO RE CONFIRMED. 3.3.7. REGARDING THE DEDUCTION OF WDV PERTAINING TO FURNITURE AND FIXTURE, COMPUTERS, SAFE, ELECTRIC FITTINGS, OFFICE EQUIPMENTS AND GAS PIPELINE, UNDOUBTEDLY THE APPELLANT HAS SOLD ITS IN DUSTRIAL UNITS ON AS IS WHERE IS BASIS WITHOUT REMOVING THE FIXED FURNITURE S AND FITTINGS IN THE NATURE OF FALSE CEILINGS, WOODEN AND GLASS PARTITIO NS, ELECTRICAL FITTINGS, GAS PIPELINE ETC WHICH ARE INTRINSICALLY ATTACHED T O THESE INDUSTRIAL UNITS. THEREFORE, ON ACCOUNT OF THESE FACTS, I FIND THAT T HE AO IS NOT JUSTIFIED IN COMPLETELY REJECTING THE CLAIM OF THE APPELLANT. FR OM THE FACTS BROUGHT ON RECORD AS DISCUSSED ABOVE I FIND THAT THE ELECTRIC FITTINGS AND GAS PIPELINES ARE PART AND PARCEL OF THE INDUSTRIAL SHE DS SOLD BY THE APPELLANT. AS THESE ITEMS ARE INTRINSICALLY ATTACHED TO THE INDUSTRIAL UNITS, THEREFORE, TO MY CONSIDERED OPINION THE AO I S NOT JUSTIFIED IN NOT ALLOWING THE DEDUCTION TO THE EXTENT OF THE WDV PER TAINING TO THESE BLOCK OF ASSETS AMOUNTING TO RS. 25,55,697/- I.E. RS. 25,0 6,696/- ON ACCOUNT OF ELECTRIC FITTINGS AND FURTHER RS. 49,001/-ON ACCO UNT OF GAS PIPELINES. THEREFORE, IN VIEW OF THE SAME THE AO IS DIRECTED T O ALLOW DEDUCTION OF RS 25,55,697/- ON THIS ACCOUNT OUT OF THE MARKET VAL UE ON SALE OF INDUSTRIAL UNITS DETERMINED BY THE DVO FOR THE PURP OSE OF COMPUTATION OF DEEMED SHORT-TERM CAPITAL GAIN U/S 50 OF THE ACT. TH EREFORE, THE ADDITION MADE ON ACCOUNT OF THE SHORT TERM CAPITAL GAIN TO T HIS EXTENT IS DIRECTED TO BE DELETED. 3.3.8. HOWEVER, AT THE SAME TIME I ALSO FIND THAT A PART OF FURNITURE AND FIXTURE CONSIST OF MOVABLE FURNITURES IN THE NATURE OF TABLES, CHAIRS ETC, COMPUTERS, SAFES AND OFFICE EQUIPMENTS ARE NOT INTR INSICALLY ATTACHED TO THESE INDUSTRIAL SHEDS SOLD BY THE APPELLANT, THERE FORE, THE AO IS FULLY JUSTIFIED DISALLOWING THE CLAIM OF THE APPELLANT. N O SPECIFIC TERMS AND CONDITIONS ON THIS ACCOUNT ARE FOUND RECORDED IN TH E SUBLEASE DEEDS EXECUTED BY THE APPELLANT. THEREFORE, TO MY CONSIDE RED OPINION THE APPELLANT CANNOT BE GIVEN THE BENEFIT OF DEDUCTION OUT OF THE MARKET VALUE DETERMINED BY THE APPELLANT ON ACCOUNT OF WDV OF RS. 23,290/- PERTAINING TO SAFES, RS.1,39,379/-PERTAINING TO COMPUTERS AND RS .14,70,913/- PERTAINING TO OFFICE EQUIPMENTS. THESE ITEMS CANNOT BE HELD AS PART AND PARCEL OF THE INDUSTRIAL SHEDS TRANSFERRED OR SOLD BY THE APPELLANT. THEREFORE, THE DISALLOWANCE OF DEDUCTION CLAIMED ON THIS ACCOUNT FOR THE COMPUTATION OF DEEMED SHORT TERM CAPITAL GAIN BY TH E AO STANDS. 3.3.9. FURTHER, IN VIEW OF THE ABOVE DISCUSSION AS WELL AS DULY TAKING INTO CHIRAG DESIGN 3494/2011 3541/2011 8 CONSIDERATION THE OVERALL FACTS AND CIRCUMSTANCES O F THE CASE, TO MY CONSIDERED OPINION A PART OF FURNITURE AND FIXTURE IS INTRINSICALLY ATTACHED TO THE INDUSTRIAL UNITS AND A PART THEREOF BEING MO VABLE AND SEPARATE FURNITURE AND FIXTURE IN THE NATURE OF TABLES, CHAI RS ETC CANNOT BE CONSIDERED AS INTRINSICALLY ATTACHED TO THE INDUSTR IAL UNITS. HOWEVER, THE AR COULD NOT FURNISH THE COMPLETE ITEM WISE DETAI LS OF THE FURNITURE AND FIXTURE EXCEPT SUBMITTING THAT MOST OF THE ITEM S INCLUDED THEREIN ARE PART AND PARCEL OF THE INDUSTRIAL UNITS. THE AO HAS ALSO NOT WORKED OUT THE ITEM WISE PARTICULARS OF FURNITURE AND FIXTURE INCLUDED IN THE WDV AS ON 01.04.2007. THEREFORE, CONSIDERING TO THE OVERAL L FACTS AND CIRCUMSTANCES OF THE CASE TO MY CONSIDERED OPINION IT WOULD MEET THE ENDS OF JUSTICE IN CASE IT IS HELD THAT 50% OF THE WDV PERTAINING TO FURNITURE AND FIXTURE IS ON ACCOUNT OF MOVABLE ITEM S NOT INTRINSICALLY ATTACHED TO THE INDUSTRIAL UNITS AND BALANCE 50% OF THE WDV PERTAINING TO FURNITURE AND FEATURE IS INSEPARABLE AND INTRINS ICALLY ATTACHED TO THE INDUSTRIAL UNITS. ACCORDINGLY, IN VIEW OF THE SAME, THE AU IS DIRECTED TO ALLOW 50% OF THE WDV OF FURNITURE AND FIXTURE AS ON 01.04.2007 TO BE DEDUCTED AGAINST THE MARKET VALUE ON SALE OF INDUST RIAL UNITS DETERMINED BY THE DVO FOR THE PURPOSE OF COMPUTATIO N OF DEEMED SHORT- TERM CAPITAL GAINS U/S 50 OF THE ACT. THE ADDITION M ADE ON THIS ACCOUNT ON ACCOUNT OF BEING SHORT TERM CAPITAL GAIN, AS DIS CUSSED ABOVE, IS PARTLY ALLOWED. 10. AGGRIEVED THE ASSESSEE IS BEFORE THE ITAT. 11. BEFORE US, THE AR REITERATED THE BASIC SUBMISSI ONS MADE BEFORE THE REVENUE AUTHORITIES AND ALSO SUBMITTED THAT BECAUSE OF THE DIFFERENCES BETWEEN THE PARTNERS, THE ENTIRE MANUFACTURING FACILITY HAD TO BE SOLD. THE BUSINESS WAS SHUT DOWN OVERNIGHT AND THE ASSESSEE TRANSFERRE D THE GALAS TO NEW ENTRANTS, I.E. DANIA AND YASH ON AS IS WHERE BASIS AND WHO MOVED IN WITHIN A PERIOD OF LESS THEN ONE MONTH, I.E. IN JUNE 2007, T HOUGH, THE GALAS WERE TRANSFERRED TO THE NEW ENTRANTS VIDE THREE WAY AGRE EMENT, WHICH WERE EXECUTED IN OCTOBER, 2007. DURING THE COURSE OF HEARING, THE AR PRODUCED PHOTOGRAPHS OF THE FURNITURE AND FIXTURES AS DONE UP IN THE GAL AS, WHICH INCLUDED GLASS PARTITIONS, CONFERENCE TABLES, ETC., WHICH COULD NO T HAVE BEEN REMOVED WITHIN THE SHORTEST DURATION OF TIME, I.E. BETWEEN MAY 20, 2007 WHEN THE BUSINESS WAS SHUT DOWN AND JUNE 20, 2007, WHEN THE BUYERS AC TUALLY MOVED INTO OCCUPY THE GALAS. 12. THEREFORE, ACCORDING TO THE AR, THE ASSESSEE DID NOT MAKE ANY ITEMATIZED CHIRAG DESIGN 3494/2011 3541/2011 9 SALE OF EITHER THE FIXTURES OR OF ANY OTHER FIXED A SSET WHEN IT SOLD THE GALAS TO DANIA AND YASH. 13. THE AR, THEREFORE, PLEADED THAT THE VALUATION G IVEN BY THE ASSESSEE HAS TO BE TAKEN TO BE CORRECT FROM ANOTHER POINT OF VIE W, I.E. THE OWNER OF THE GALAS WAS THE GOVT. OF INDIA, AND UNDER NO CIRCUMSTANCE, THE ASSESSEE COULD HAVE NEGOTIATED TWO RATES, I.E. BETWEEN THEMSELVES ON TH E ONE HAND AND ANOTHER AGREEMENT, INTERSE BETWEEN THEMSELVES AND THE GOVER NMENT OF INDIA, IN A THREE WAY AGREEMENT, WHICH HAD TO BE ENTERED INTO BY THE ENTRANT, INTO SEEPZ. HE SUBMITTED THAT IN ANY CASE THE VALUATION ADOPTED BY THE AO, TAKING INTO CONSIDERATION THE MUNICIPAL READY RECKONER HAS BEEN RENDERED DEFECTIVE AFTER THE RECEIPT OF THE REPORT FROM DVO AS THE VALUATION DONE BY THE REGISTERED VALUER, WHICH WAS AT RS. 8,50,46,000. THE AR ALSO O BJECTED TO THE DISALLOWANCE ON ACCOUNT OF THE PAYMENTS MADE AS ADVANCES TOWARDS STATUTORY BODIES OF RS. 72,60,184, OUT OF WHICH RS. 69,07,946 PERTAINED TO PROPERTY TAX ADVANCE. ON A QUERY BY THE BENCH THAT THIS SHOULD HAVE BEEN RECOV ERED FROM THE BUYER, THE AR REPLIED THAT NOTHING WAS RECOVERED. 14. THE AR, THEREFORE SUBMITTED THAT THE ENTIRE CON SIDERATION WHICH HAS BEEN RECEIVED IS ALL INCLUSIVE AND THE BUYERS OCCUPIED THE GALAS IN LESS THEN ONE MONTH OF THE CLOSURE OF BUSINESS AND THEREFORE THE VALUE TAKEN BY THE AO OF THE GALAS AND PROFIT COMPUTED THEREON WAS IN COMPLETE E RROR. 15. THE DR, ON THE OTHER HAND STRONGLY REFUTED THE ARGUMENTS OF THE AR AND SUBMITTED THAT THE SALE CONSIDERATION, ON THE FACE, DEPICTS SALE OF EACH ITEM SEPARATELY. THE DR SUBMITTED THAT SINCE THE SALE CO NSIDERATION IS GIVING AN EXACT FIGURE AND NOT ROUNDED OFF FIGURES, THIS ITSE LF, IS A PRESUMPTION THAT THE SALE OF THE GALAS WAS NOT LOCK STOCK AND BARREL, BU T CAREFULLY VALUED EACH ITEM TO CONDUCT THE SALE. THE DR THEN SUBMITTED THAT THE TRIPARTITE AGREEMENT ENTERED BY THE BUYER, ASSESSEE AND THE MIDC IS SILE NT ON ANY FURNITURE AND CHIRAG DESIGN 3494/2011 3541/2011 10 FIXTURES, THE SALE IS NOT SLUMP SALE AND NORMALLY T HE SALE IS AFFECTED AS PEACEFUL & VACANT POSSESSION, ALL THESE INDICATE THAT THERE IS SOMETHING MORE , WHICH HAS NOT COME OUT FROM THE PAPERS AND THE AO WAS CORRECT TO BASE HIS CALCULATION ON VALUATION DONE THROUGH READY RECKONER RATES FOR THE PURPOSE OF SECTION 50C. THE DR FURTHER SUBMITTED THAT THE CIT(A) WAS MORE T HEN REASONABLE TO ALLOW APPROPRIATE CREDIT ON ACCOUNT OF FURNITURE AND FIXT URES AND NON REMOVABLE ITEMS OF ELECTRIC FITTINGS AND GAS PIE LINES. 16. WE HAVE HEARD THE ARGUMENTS AND HAVE PERUSED TH E MATERIAL PLACED IN THE PAPER BOOK. FROM THE MATERIAL, AS EXAMINED BY U S, WE FIND THAT NONE OF THE GROUNDS, AS AGITATED BY THE ASSESSEE IS/ARE PARTICU LARLY AND SPECIFICALLY AGAINST THE VALUATION DIFFERENCE OF RS. 2,27,48,713 (RS. 11,20,81,000 RS. 8,93,32,286). THEREFORE, THERE IN NO ISSUE RELATING TO THE VALUATION OF SALE CONSIDERATION OF THE GALAS. HOWEVER, THE AR, MAINTA INS THAT THE SALE CONSIDERATION INCLUDES THE VALUE RELATING TO OTHER BLOCKS AND DEPOSITS. HOWEVER, ASSESSE/AR DID NOT FILE ANY EVIDENCE TO SU BSTANTIATE THE SAME. THEREFORE, IN THESE CIRCUMSTANCES, THE ARGUMENTS AD VANCED BY THE ASSESSEE, PRIMARILY BASED ON THE VALUATION OF THE GALAS ARE N ON MAINTAINABLE, HENCE WE ARE NOT GOING INTO THE VALUATION ASPECT. NEVERTHELE SS, THERE IS NOT ONE CLUE, WHICH POINTS TOWARDS LUMP SUM SALE, AS HAS BEEN REITERATED BY THE AR AT EVERY STAGE, INCLUDING, BEFORE US. IN OUR CONSIDERED OPIN ION LUMP SUM SALE WOULD, UNDER ALL CIRCUMSTANCE GIVE ONE SINGLE COMPREHENSIV E FIGURE, NOT EXACT FIGURE, GOING DOWN TO RUPEES AND PAISE, LIKE FOR EXAMPLE, T HE VALUE OF MACHINERY TAKEN, IS SHOWN AT RS. 1,61,43,858. UNDER NO CIRCUM STANCE, EVEN A PRESUMPTION CAN BE MADE THAT IT WAS A LUMP SUM SALE. ADVERTING OUR ATTENTION TOWARDS GROUNDS NO. 1, 2 & 3, WE FIND THAT THE ASSE SSEE HAD PLEADED THAT ADVANCES TO THE TUNE OF RS. 72,60,184 SHOULD BE INC LUDED IN THE COST OF THE INDUSTRIAL GALAS OR ALTERNATIVELY TO BE ALLOWED AS BUSINESS AS LOSS. IT IS AN ADMITTED FACT THAT THE DEPOSITS IN QUESTION ARE NO T REFERRED TO VALUATION. CHIRAG DESIGN 3494/2011 3541/2011 11 ASSESSEE HAS ALSO NOT FILED ANY EVIDENCE TO SUGGEST THAT THE DEPOSITS ARE PART OF THE COST OF THE ASSETS IN VARIOUS BLOCKS, THEREFORE , IN OUR CONSIDERED OPINION, WE HAVE TO REJECT BOTH THE PLEAS OF THE AR. AS SUCH , NEITHER THERE IS ANY CLARITY AS TO WHAT IS THE NATURE OF THE ADVANCES, AS TO WHE N AND IN WHAT HEAD THESE ADVANCES WERE PAID OR WHETHER THESE WERE PRINCIPAL AMOUNTS OR WERE IN THE NATURE OF PENALTIES/FEE/FINES, NOTHING HAD BEEN BRO UGHT ON RECORD, NEITHER BEFORE THE REVENUE AUTHORITIES AND NOR BEFORE US. E VEN IN THE ALTERNATIVE, ALL THESE ADVANCES ARE SUPPOSED TO BE BALANCE SHEET ITE MS, WHICH, UNDER NO CIRCUMSTANCE COULD BE ALLOWED AS BUSINESS LOSS. WE, THEREFORE, REJECT THE ARGUMENTS OF THE AR ON BOTH THE ALTERNATIVE GROUNDS . 17. GROUNDS NO. 1, 2 AND 3, CONCERNING THE ADVAN CES, ARE THEREFORE, REJECTED. 18. GROUND NO 4 PERTAINS TO NON ALLOWANCE OF THE WRITE OFF OF WDV ON SAFES AT RS. 23,290, ON COMPUTER PROGRAMME ON JEWELLERY, ON CPU AT RS. 1,39,379, OFFICE EQUIPMENTS CONNECTING TV MONITORING ETC. AT RS. 1,47,913. IN OUR CONSIDERED OPINION, THE ASSESSEE HAS NOT AT ANY STA GE, DISCHARGED ITS ONUS TO PROVE THE CORRECTNESS AND JUSTIFICATION FOR WRITE O FF. EVEN BEFORE US, THE AR, SIMPLY PRODUCES SOME PHOTOGRAPHS, SHOWING THE INTER IORS DONE SOMEWHERE, I.E. NO AUTHENTICATION, THAT THOSE PHOTOGRAPHS PERTAINED TO THE DEMISED GALAS. EVEN IF THOSE WERE PRESUMED AND ACCEPTED TO BE OF T HE DEMISED GALAS, EVEN THEN, THOSE PHOTOGRAPHS DOES NOT PROVE ANYTHING WIT H REGARD TO THE IMPUGNED ITEMS. IN THESE CIRCUMSTANCES, WE CAN ONLY SUSTAIN THE VIEWS TAKEN BY THE REVENUE AUTHORITIES. THEREFORE, ORDER OF THE CIT(A) DOES NOT CALL FOR ANY INTERFERENCE. 19. GROUND NO. 4, IS THEREFORE, REJECTED. GROUNDS NO. 5, 6, 7 & 8. CHIRAG DESIGN 3494/2011 3541/2011 12 20. APROPOS GROUNDS NO. 5, 6, 7 & 8, WE FIND TH AT THE AO REJECTED THE CLAIM OF THE ASSESSEE TO ADD THE VALUES OF OFFICE EQUIPME NTS AND FIXTURES, WHEREAS, THE CIT(A) ALLOWED 50% OF THE WDV TO BE ADDED TO TH E COST AS DETERMINED BY THE AO ON FURNITURE & FIXTURES AND ALLOWED THE WHOL E OF WDV TO BE ADDED FOR ELECTRIC FITTINGS AND GAS PIPE LINES TO THE COST OF THE GALAS. 21. THE AR REITERATED THE ARGUMENTS, WHEREAS, TH E DR SUBMITTED THAT THE CIT(A) WAS MORE THEN REASONABLE TO ALLOW THE WDV OF THE ITEMS MENTIONED IN THE GROUNDS TO BE ADDED TO THE COST, WHICH HAD BEEN REDUCED BY THE AO. THE DR FURTHER SUBMITTED THAT THESE ITEMS SHOULD NOT BE ALLOWED TO BE ADDED AS PER THE NORMAL PRINCIPLES OF SALE OF GALAS, WHICH, EVEN AS PER CLAUSE (T) OF THE AGREEMENT, THE DEMISED GALA(S) HAD TO BE HANDED OVE R AS VACANT PREMISES. 22. AFTER PERUSING THE GROUNDS, THE ORDERS OF T HE REVENUE AUTHORITIES AND THE RELEVANT CLAUSE IN THE TRIPARTITE AGREEMENT, WE FIN D THAT THE CIT(A) HAD BEEN REASONABLE. AS SEEN FROM THE PHOTOGRAPHS, PRODUCED BEFORE US, WHICH WE ARE ONLY PRESUMING TO BE TAKEN OF THE DEMISED GALAS, WE FIND THAT THE FITTINGS AND GLASS FACADE/PARTITIONS WERE INTRICATELY FIXED AND A FAIR PRESUMPTION CAN BE MADE THAT, IF THE ASSESSEE VACATED THE PREMISES AND NEW ENTRANTS TOOK OVER THE POSSESSIONS OF THE GALAS IMMEDIATELY, THESE FITTING S WOULD HAVE GONE WITH THE POSSESSION AS WELL. IN THESE CIRCUMSTANCES, WE FAIR LY THINK THAT THE VALUES ADOPTED BY THE CIT(A) ARE VERY REASONABLE. WE, THER EFORE, DO NOT FIND ANY REASON TO DISTURB THE FINDINGS OF THE CIT(A), WHICH WE SUSTAIN. THESE GROUNDS ARE THEREFORE, REJECTED. 23. IN THE RESULT, GROUNDS NO. 5, 6, 7 AND 8 AR E REJECTED. 24. GROUND NO. 9 IS ON JURISDICTION. THE GROUND IS REJECTED, SINCE THIS ISSUE WAS NOT AGITATED BY THE AR AT THE TIME OF HEARING. WE, THEREFORE, REFRAIN FROM CHIRAG DESIGN 3494/2011 3541/2011 13 GIVING ANY FINDINGS IN THE GROUND OF APPEAL. 25. GROUND NO. 10 IS GENERAL. 26. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED ITA NO. 3541 OF 2011 - REVENUES APPEAL THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE DEPAR TMENT : 1. THE LEARNED CIT(A) HAS ERRED ON FACTS AND IN LAW AND IN THE CIRCUMSTANCES OF THE CASE IN ALLOWING THE DEDUCTION OF RS 25,55,697/- (I.E. DEDUCTION TO THE EXTENT OF WDV OF RS 25,06,696/- ON A/C OF ELECTRIC FITTING AND RS. 49,001/- ON A/C OF GAS PIPE LINE) AND ALSO ALLOWING THE DEDUCTION TO T HE EXTENT OF 50% OF WDV OF FURNITURE AND FIXTURE OF RS 44,36,456/- (I.E. 50% O F WDV OF FURNITURE AND FIXTURE) ON ACCOUNT OF MARKET VALUE ON SALE OF INDUSTRIAL UN ITS DETERMINED BY THE DVO FOR THE PURPOSE OF COMPUTATION OF DEEMED SHORT TERM CAPITAL GAIN U/S 50 OF THE I.T. ACT, 1961. SINCE THE MATTER OF VALUATION REFERS TO DVO OF INDU STRIAL GALA ONLY NOT INCLUDING ALL EQUIPMENTS AND WITH FURNITURE AND FIXTURE BUT C IT(A) ERRED ON FACTS AND IN LAW AND DECIDED THE ISSUE ON THE BASIS OF VALUATION GIVEN BY THE DVO. 2. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(AP PEALS) ON THE ABOVE GROUNDS TO BE SET ASIDE AND THAT OF THE AO BE RESTORED. 3. THE APPELLANT CRAVES TO LEAVE TO AMEND OR ALTER ANY GROUND OR TO SUBMIT ADDITIONAL NEW GROUND WHICH MAY BE NECESSARY. 27. GROUND NO. 1 IS AGAINST CONCESSIONS GIVEN BY TH E CIT(A) ON ELECTRIC FITTINGS, GAS PIPE LINE, FURNITURE & FIXTURES. IN T HE IMPUGNED ORDER, THE CIT(A) GRANTED RELIEF FULLY IN RESPECT OF THE WDV CLAIM RE LATING TO ELECTRIC FITTINGS AND GAS PIPELINES. CIT(A) GRANTED PART RELIEF AT 50% OF THE WDV ON THE BLOCK RELATING TO FURNITURE AND FIXTURE. REVENUE IS AGGRI EVED WITH THE SAID DECISION OF THE CIT(A) AND RAISED THE ABOVE GROUND IN THE A PPEAL. THE CIT(A) MENTIONED RELEVANT FACT AND DISCUSSION IN PARA 3.3. 7 OF THE IMPUGNED ORDER BEFORE GRANTING RELIEFS TO THE ASSESSEE. ON PERUSAL OF THE SAME, IT IS NOTICED THAT THE CIT(A) GRANTED RELIEF CONSIDERING THE FACT THAT THE ELECTRIC FITTINGS AND GAS PIPELINES ARE CONCEALED ONES AND THEY CANNOT BE EASILY SEPARATED AND SOLD FOR CONSIDERATION. REGARDING THE FURNITURE AND F IXTURE THE PHOTOGRAPHS FILED CHIRAG DESIGN 3494/2011 3541/2011 14 BEFORE US INDICATE THE INSEPARABILITY OF THESE ITEM S FROM THE GALAS. 28. THEREFORE, IN OUR OPINION, THE OBSERVATION OF T HE CIT(A) IS PROPER AND IT DOES NOT CALL FOR ANY INTERFERENCE. ACCORDINGLY THE GROUND NO. 1 IS REJECTED. 29. GROUNDS NO. 2 & 3 ARE GENERAL. 30. THE APPEAL FILED BY THE DEPARTMENT IS, THEREFOR E, DISMISSED. 31. IN THE RESULT: APPEAL FILED BY THE ASSESSEE IS DISMISSED. APPEAL FILED BY THE DEPARTMENT IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 0 7/12/1012 SD/- (D. KARUNAKARA RAO) ACCOUTANT MEMBER SD/- (VIVEK VARMA) JUDICIAL MEMBER MUMBAI, DATE: 07/12/2012 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A)- 22 , MUMBAI. 4) THE CIT 10, MUMBAI, 5) THE D.R. C BENCH, MUMBAI. 6) COPY TO GUARD FILE. BY ORDER / / TRUE COPY / / ASSTT. REGISTRAR I.T.A.T., MUMBAI *CHAVAN