The ACIT,Vapi Circle, Vapi V. Omnibus Industrial Development Corporation of Daman & Diu & DNH Ltd., Nani Daman

ITA 36/AHD/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 94793 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 19-10-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 05-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P F JAIN A R
• Keywords: Depreciation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD .. , ( .) , BEFORE SHRI G.D. AGARWAL,VICE PRESIDENT (AZ) AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ I.T.A. NO.36/AHD/2012 ( / ASSESSMENT YEAR : 2008-09) THE ASSTT.CIT VAPI CIRCLE, VAPI / VS. M/S.OMNIBUS INDUSTRIAL DEVELOPMENT CORPORATION OF DAMAN & DIU AND DADRA & NAGAR HAVELI LTD. PLOT NO.35, SOMNATH NANI DAMAN % & ./ ./ PAN/GIR NO. : AAACO 3361 K ( %( / APPELLANT ) .. ( )*%( / RESPONDENT ) %( + / APPELLANT BY : SHRI ASHISH POPHARE, SR.DR )*%( , + / RESPONDENT BY : SHRI P.F. JAIN, AR -. , /& / DATE OF HEARING 19/10/2015 0123 , /& / DATE OF PRONOUNCEMENT 30/11/2015 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-VALSAD [CIT(A) IN SHORT] DATED 30/09/2011 PERTAINING TO ASSESSMENT YEAR (AY) 2008-09. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - ITA NO.36/AHD/2 012 ACIT VS. M/S.OMNIBUS INDUSTRIAL DEVELOPMENT CORP N.. ASST.YEAR 2008-09 - 2 - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE DISALLOWANCE OF PRIOR PERIOD EXPENDITURE AMOUNTING TO RS.11,19,284/- MADE BY THE AO. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION MADE ON ACCOUNT OF DIFFERENTIAL PROFIT ON CONTRACT OF RS.37,180/- MADE BY THE AO. 3. IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE LEAR NED CIT(A) BE SET ASIDE AND THAT THE ORDER OF THE AO BE RESTORED. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND A NY GROUNDS OF APPEAL. 2. BRIEFLY STATED FACTS ARE THAT THE CASE OF THE AS SESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S.143( 3) OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS FRAMED VIDE ORDER DATED 09/12/2010. WHILE FRAMING THE ASSESSMENT, TH E ASSESSING OFFICER (AO) DISALLOWED THE PRIOR PERIOD DEPRECIATION OF RS .7,68,462/-, PRIOR PERIOD EXPENDITURE OF RS.11,19,284/- AND DIFFERENTI AL PROFIT ON CONTRACT OF RS.37,180/-. THE ASSESSEE BEING AGGRIEVED BY THE A SSESSMENT ORDER, PREFERRED AN APPEAL BEFORE THE LD.CIT(A), WHO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE ALLOWED THE APPEAL. AGGRIEVED BY THE ORDER OF THE LD.CIT(A), NOW THE REVENUE IS IN APPEAL BEFO RE US. 3. FIRST GROUND OF APPEAL IS AGAINST DELETION OF DI SALLOWANCE OF PRIOR PERIOD EXPENDITURE AMOUNTING TO RS.11,19,284/- THE LD.SR.DR SUPPORTED THE ORDER OF THE AO AND SUBMITTED THAT THE LD.CIT(A ) WAS NOT JUSTIFIED IN DELETING THE DISALLOWANCE. HE SUBMITTED THAT DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO HAD NOTICED THAT THE PRIOR PERIOD ITEMS ITA NO.36/AHD/2 012 ACIT VS. M/S.OMNIBUS INDUSTRIAL DEVELOPMENT CORP N.. ASST.YEAR 2008-09 - 3 - INCLUDED PROVISIONS FOR INCOME TAX, WHICH WAS DEDUC TED WHILE ARRIVING AT FBT BUT APPEARED TO HAVE NOT BEEN ADDED BACK WHI LE COMPUTING TOTAL INCOME. 3.1. ON THE CONTRARY, THE LD.COUNSEL FOR THE ASSESS EE SUPPORTED THE ORDER OF THE LD.CIT(A) AND SUBMITTED THAT THE OBSERVATION OF THE AO IS PATENTLY INCORRECT. THE LD.COUNSEL FOR THE ASSESSEE DREW OU R ATTENTION TOWARDS PAPER-BOOK AT PAGE NO.2 IN SUPPORT OF HIS CONTENTIO N THAT THE AO WAS NOT CORRECT IN OBSERVING THAT THE PRIOR PERIOD EXPENDIT URE WERE NOT ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. THE LD.C IT(A) HAS GIVEN A FINDING ON FACT THAT THE ASSESSEE HAS ALREADY DISAL LOWED THE PRIOR PERIOD EXPENDITURE AMOUNTING TO RS.11,19,284/- AND ADDED BACK TO THE TOTAL INCOME SHOWING IN ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION. THIS FINDING ON FACT OF THE LD.CIT(A) IS NOT CONTRO VERTED BY THE REVENUE BY PLACING ANY CONTRARY MATERIAL ON RECORD. MOREOV ER, THE LD.COUNSEL FOR THE ASSESSEE DEMONSTRATED THAT IN THE COMPUTATION O F TAXABLE INCOME, THESE EXPENDITURE HAVE BEEN ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. THEREFORE, WE DO NOT SEE ANY REASON TO I NTERFERE WITH THE ORDER OF THE LD.CIT(A), SAME IS HEREBY UPHELD. THUS, GRO UND NO.1 OF REVENUES APPEAL IS REJECTED. ITA NO.36/AHD/2 012 ACIT VS. M/S.OMNIBUS INDUSTRIAL DEVELOPMENT CORP N.. ASST.YEAR 2008-09 - 4 - 4. SECOND GROUND OF APPEAL IS AGAINST DELETION OF A DDITION MADE ON ACCOUNT OF DIFFERENTIAL PROFIT ON CONTRACT OF RS.37 ,180/-. THE LD.SR.DR SUPPORTED THE ORDER OF THE AO. 4.1. ON THE CONTRARY, LD.COUNSEL FOR THE ASSESSEE S UBMITTED THAT MAJOR ACTIVITY OF THE ASSESSEE DURING THE RELEVANT ASSESS MENT YEAR WAS OF TRADING IN LIQUOR. APART FROM ITS MAIN ACTIVITY OF BUSINESS, THE ASSESSEE ALSO UNDERTAKES PROJECTS/CONTRACTS ON BEHALF OF GOV ERNMENT OF INDIA WHICH ARE MAINLY FOR THE PURPOSE OF PROVIDING BASIC AMENITIES FOR THE PUBLIC AND THE SOCIETY AT LARGE. BEING A CORPORATI ON WHOSE 100% SHARE HOLDING IS WITH THE PRESIDENT OF INDIA, THE ASSESSE E GETS FUND FROM THE GOVERNMENT OF INDIA FOR EXECUTING THE PROJECTS. TH E PROJECTS MAY NOT NECESSARILY BE CONSTRUCTION PROJECTS BUT ALSO INCLU DE PROJECTS WHICH IS FOR THE BENEFIT OF THE GENERAL PUBLIC. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THERE IS NO POSTPONEMENT OF REVENUE OR PROFIT AND THEREBY PAYMENT OF TAXES. THE PROFITS ARE OFFERED FOR TA X AS AND WHEN THEY ACCRUE AND TAXES ARE PAID ACCORDINGLY BY THE ASSESS EE. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT THE LD.CIT(A) HAS GIVEN A FINDING THAT THE AOS WORKING ON THIS POINT IS MERE GUESS WORK AND WITHOUT ANY BASIS . THIS FINDING OF THE LD.CIT(A) IS NOT CONTROVERTED BY THE REVENUE BY PLA CING ANY CONTRARY MATERIAL ON RECORD. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE WITH ITA NO.36/AHD/2 012 ACIT VS. M/S.OMNIBUS INDUSTRIAL DEVELOPMENT CORP N.. ASST.YEAR 2008-09 - 5 - THE ORDER OF THE LD.CIT(A), SAME IS HEREBY UPHELD. THUS, GROUND NO.2 OF REVENUES APPEAL IS REJECTED. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE COURT ON MONDAY, THE 30 TH DAY OF NOVEMBER, 2015 AT AHMEDABAD. SD/- SD/- ( .. ) ( ) ( . ) ( G.D. AGARWAL ) ( KUL BHARAT ) VICE PRESIDENT (AZ) JUDICIAL MEMBER AHMEDABAD; DATED / 11 /2015 6/..-, .-../ T.C. NAIR, SR. PS !'#$%&' &$ / COPY OF THE ORDER FORWARDED TO : 1. %( / THE APPELLANT 2. )*%( / THE RESPONDENT. 3. 789 : / CONCERNED CIT 4. : ( ) / THE CIT(A)-VALSAD 5. ;< )-89 , / 893 , 7 / DR, ITAT, AHMEDABAD 6. <= >. / GUARD FILE. ! / BY ORDER, *; ) //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 19.X.15 (DICTATION-PAD 6- PAGES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER .. 29.X.15 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.30.11.15 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 30.11.15 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER