SWASTIKA INVESTMENT LTD, MUMBAI V. DCIT CIR 4(2), MUMBAI

ITA 3550/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1787 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-05-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: J
• Next Hearing Date: 18-05-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 01-06-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: L K AGRAWAL
• Keywords: Depreciation; Cost of acquisition
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH J : MUMBAI BEFORE SHRI D.K. AGARWAL, (JM) AND SHRI B. RAMAKOT AIAH ,(AM) ITA NO.3550/MUM/2009 ASSESSMENT YEAR : 2006-07 SWASTIKA INVESTMART LTD. 1 ST FLOOR, BANDOOKWALA BLDG. BRITISH HOTEL LANE, FOUNTAIN MUMBAI-400 001. ..( APPELLANT ) P.A. NO. (AABCS 6585 J) VS. DY. COMMISSIONER OF INCOME TAX CIRCLE 4 (2) MUMBAI. ..( RESPONDENT ) APPELLANT BY : SHRI PRAKASH PANDIT RESPONDENT BY : SHRI L. K. AGRAWAL O R D E R PER D.K. AGARWAL (JM). THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER DATED 7.5.2009 PASSED BY THE LD. CIT(A) FOR THE ASSESSMENT YEAR 2006-07. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE COM PANY IS ENGAGED IN THE BUSINESS OF SECURITIES BROKING, TRADING AN D INVESTMENT. THE RETURN WAS FILED DECLARING TOTAL INCOME OF RS.1,06, 30,724/- . WHILE MAKING THE ASSESSMENT U/S. 143(3) OF THE INCOME TAX ACT, 1961(THE ACT), VIDE ORDER DATED 30.10.2008, THE ASSESSIN G OFFICER INTERALIA DISALLOWED DEPRECIATION ON BSE CARD RS.14,21,875/- AND ALSO MADE PROTECTIVE ADDITION (BSE CARD) RS.14,21,875/- IN CASE IT IS FINALLY HELD THAT DEPRECIATION IS PERMISSIBLE TO THE ASSESSEE AND THE ASSESSEE ITA NO.3550/MUM/09 A.Y:06-07 2 CLAIMS THE ORIGINAL COST OF MEMBERSHIP OF BSE AS HIS COST OF ACQUISITION. ON APPEAL, THE LD. CIT(A) WHILE AGREEI NG WITH THE VIEW OF THE ASSESSING OFFICER, DIRECTED THE ASSESSING OFFICER NOT TO ENFORCE DEMAND PERTAINING TO PROTECTIVE ADDITION OF RS.14,21, 875/- AND ACCORDINGLY PARTLY ALLOWED THE APPEAL. 3. BEING AGGRIEVED BY THE ORDER OF THE LD. CIT(A) T HE ASSESSEE IS IN APPEAL BEFORE US CHALLENGING IN BOTH THE GROUNDS THE SUSTENANCE OF DISALLOWANCE OF DEPRECIATION OF RS.14,21,875/- ON BSE M EMBERSHIP CARD AND PROTECTIVE ADDITION OF RS.14,21,875/- WITHOU T ANY REASONING. 4. AT THE TIME OF HEARING THE LD. COUNSEL FOR THE A SSESSEE FAIRLY SUBMITS THAT IN VIEW OF THE RECENT JUDGMENT OF THE HON BLE JURISDICTIONAL HIGH COURT IN TECHNO SHARES AND STOCKS LTD ., THE ISSUE IS COVERED AGAINST THE ASSESSEE AND IN FAVOUR OF THE REVENUE , THEREFORE, THE ISSUE MAY BE DECIDED ACCORDINGLY. WITH REGARD TO TH E PROTECTIVE ADDITION OF RS.14,21,875/- HE SUBMITS THAT THE SAME IS WITHOUT ANY REASON AND, HENCE, LIABLE BE DELETED. 5. ON THE OTHER HAND THE LD. DR WHILE RELYING ON TH E ORDER OF THE ASSESSING OFFICER AND THE LD. CIT(A) SUBMITS THAT THE ISSU E IS SQUARELY COVERED IN FAVOUR OF THE REVENUE BY THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT IN TECHNO SHARES AND STOCKS LTD . HE, THEREFORE, SUBMITS THAT THE ORDER PASSED BY THE LD. CIT (A) BE UPHELD. 6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RI VAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE FACTS ARE NOT IN DISPUTE. RECENTLY THE HONBLE JURISDICTION AL HIGH COURT IN CIT VS. TECHNO SHARES AND STOCK LTD. (2010) 323 ITR 69 (BOM.) HAS ITA NO.3550/MUM/09 A.Y:06-07 3 HELD THAT THE BSE CARD DOES NOT FALL IN ANY OF THE CA TEGORIES SPECIFIED U/S.32(1)(II), OF THE ACT, DEPRECIATION CANNOT BE ALLOW ED ON THE BSE CARD. RESPECTFULLY FOLLOWING THE SAME WE ARE OF THE V IEW THAT THE ASSESSEE IS NOT ENTITLED TO DEPRECIATION ON BSE MEMBERSHIP CARD AND ACCORDINGLY THE ORDER PASSED BY THE LD. CIT(A) SUSTAININ G THE DISALLOWANCE OF DEPRECIATION ON BSE MEMBERSHIP CARD IS U PHELD. GROUND NO. 1 TAKEN BY THE ASSESSEE IS, THEREFORE, REJECTE D. 7. WITH REGARD TO THE PROTECTIVE ADDITION OF RS.14,21 ,875/- WE ARE OF THE VIEW THAT IN VIEW OF AFORESAID FINDINGS, THE SAME IS NOT SUSTAINABLE AND ACCORDINGLY THE SAME IS DELETED. GROUN D NO.2 TAKEN BY THE ASSESSEE IS, THEREFORE, ALLOWED. 8. IN THE RESULT ASSESSEE'S APPEAL STANDS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 28.5.2010. SD/- SD/- (B. RAMAKOTAIAH) ( D.K. AGARWAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 28.5.2010. JV. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI. ITA NO.3550/MUM/09 A.Y:06-07 4 DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 19.5.10 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 20.5.10 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON 28.5.10 SR.PS/PS 7. FILE SENT TO THE BENCH CLERK 31.5.10 SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER