ALOK INDUSTRIES LTD, MUMBAI V. ACIT CEN CR -35, MUMBAI

ITA 4087/MUM/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8530 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-10-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 04-10-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 18-05-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SURINDER VIT SING H
• Assessee Lawyers: ANKIT KOCHAR
• Keywords: Depreciation; Revenue expenditure
• Section: 143(3); 263

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A MUMBAI . . , BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND , SHRI RAJENDRA, ACCOUNTANT MEMBER I.TA. NO. 4087/MUM/2011 ASSESSMENT YEAR 2006-07 M/S. ALOK INDUSTRIES LIMITED, PENINSULA TOWERS, PENINSULA CORPORATE PARK, G.K. MARG, LOWER PAREL, MUMBAI 400 013. PAN: AAACA 0201 C VS. ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-35, MUMBAI. ( / APPELLANT ) ( ! / RESPONDENT ) APPELLANT BY : SHRI ANKIT KOCHAR RESPONDENT BY : SHRI SURINDER VIT SINGH ' # $% / DATE OF HEARING : 04-10-2012 &'( # $% / DATE OF PRONOUNCEMENT : 04-10-2012 ) / O R D E R PER RAJENDRA, AM CHALLENGING THE ORDER OF THE COMMISSIONER OF INCOME TAX, CENTRAL-III, DTD.18-03-2011, PASSED U/S. 263 OF THE INCOME TAX A CT, 1961 (ACT), ASSESSEE- COMPANY RAISED THE FOLLOWING GROUNDS OF APPEAL VIDE ITS APPEAL DT. 18-05-2011. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX, CENTRAL III (CIT), GENERAL : 1.ERRED IN INVOKING REVISION JURISDICTION UNDER SEC TION 263 OF THE INCOME TAX ACT, 1961 (ACT),WITHOUT APPRECIATING THAT THE ASSESSMENT OR DER UNDER SECTION 143(3) PASSED BY THE ASSESSING OFFICER (AO) WAS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF THE REVENUE. ALLOWABILITY OF INTEREST EXPENDITURE OF RS 78.24 C RORES : 2.ERRED IN DIRECTING THE AO TO EXAMINE THE ALLOCATI ON OF INTEREST EXPENDITURE TOWARDS CAPITAL ACCOUNT OR REVENUE ACCOUNT, WITHOUT APPRECIATING TH AT THE DETAILS OF INTEREST EXPENDITURE WAS AVAILABLE WITH THE AO AND THE AO HAD ALLOWED THE CL AIM OF THE APPELLANT AFTER EXAMINING THE I.TA. NO. 4087/MUM/2011 M/S. ALOK INDUSTRIES LIMITED, 2 FACTS OF THE CASE AND NO DIRECTIONS CAN BE GIVEN ME RELY ON ASSUMPTIONS AND SURMISES. 3.FAILED TO APPRECIATE THAT SHOW CAUSE NOTICE WAS I SSUED ONLY ON THE ISSUE THAT NO INTEREST EXPENSES WERE CAPITALIZED AND HENCE DIRECTIONS BEYO ND ISSUE RAISED IN SHOW CAUSE NOTICE IS BAD IN LAW. DEDUCTION UNDER SECTION 35D IN RESPECT OF EXPENSES FOR ISSUE OF FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBS) 4.ERRED IN DIRECTING THE AO TO EXAMINE WHETHER FCCB WERE IN THE NATURE OF LOAN AT THE TIME OF ISSUE. 5.FAILED TO APPRECIATE THAT THE APPELLANT HAS TREAT ED THE ENTIRE ISSUE EXPENSES AS CAPITAL IN NATURE AND CLAIMED 1/5TH DEDUCTION UNDER SECTION 35 D AND ISSUE OF FCCB BEING IN THE NATURE OF LOAN OR NOT WOULD HAVE ARISEN ONLY WHEN ISSUE EX PENDITURE ARE CLAIMED AND ALLOWED AS REVENUE EXPENDITURE. 6.ERRED IN DIRECTING THE AO TO EXAMINE WHETHER THE PAYMENTS TOWARDS ISSUE EXPENSES WERE TAXABLE IN INDIA AND THEREBY APPLICABILITY OF SECTI ON 195 FOR DEDUCTION OF TAX AT SOURCE, WITHOUT APPRECIATING THAT THE PAYMENTS DO NOT FALL WITHIN THE DEFINITION OF FEES FOR TECHNICAL SERVICES. 7.WITHOUT PREJUDICE TO THE ABOVE, ACCEPTING FOR THE SAKE OF ARGUMENT, BUT WITHOUT ADMITTING THAT PAYMENT IS TOWARDS FEES FOR TECHNICAL SERVICES , SINCE THE EXPENSES ARE ALREADY TREATED AS CAPITAL IN NATURE, NON DEDUCTION OF TAX AT SOURCE D OES NOT HAVE ANY IMPLICATION AND THE SAME IS OTIOSE. 8.ERRED IN DIRECTING THE AO TO EXAMINE THE ALLOWABI LITY OF DEPRECIATION ON COMPUTER ACCESSORIES I.E ROUTERS, SCANNERS, MODEMS ETC AT 60 % IN VIEW OF THE DECISION OF MUMBAI TRIBUNAL IN THE CASE OF ROUTERMANIA TECHNOLOGIES (P ) LTD {16 SOT 384) WHICH IS ALREADY OVERRULED BY MUMBAI SPECIAL BENCH IN THE CASE OF DA TACRAFT INDIA LTD [133 TTJ 377] THE APPELLANT CRAVES, TO CONSIDER EACH OF THE ABOV E GROUNDS OF APPEAL WITHOUT PREJUDICE TO EACH OTHER AND CRAVES LEAVE TO ADD, ALTER, DELETE O R MODIFY ALL OR ANY OF THE ABOVE GROUNDS OF APPEAL. 2. TO-DAY, WHEN THE CASE WAS CALLED OUT FOR HEARING, A UTHORISED REPRESENTATIVE (AR) OF THE ASSESSEE-COMPANY SUBMITTED THAT APPELLANT WA NTED TO WITHDRAW THE APPEAL. DEPARTMENTAL REPRESENTATIVE (DR) DID NOT OBJECT THE WITHDRAWAL OF THE APPEAL. 3. AS THE ASSESSEE-COMPANY IS NOT INTERESTED IN PERUSING THE MATTER, THEREFORE, WE ALLOW IT TO WITHDRAW THE SAME. APPEAL STANDS DISPOSED FOR STATISTICAL PURPOSE S. ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH OCTOBER, 2012. SD/- SD/- ( . . / I.P. BANSAL ) ( / RAJENDRA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI, *' DATE: 4 TH OCTOBER, 2012 TNMM I.TA. NO. 4087/MUM/2011 M/S. ALOK INDUSTRIES LIMITED, 3 ) ) ) ) # ## # $+ $+ $+ $+ ,+($ ,+($ ,+($ ,+($ / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. THE CONCERNED CIT (A) 4. THE CONCER NED CIT 5. DR A BENCH, ITAT, MUMBAI 6. GUARD FILE !+$ $ //TRUE COPY// )' )' )' )' / BY ORDER, - -- - / . . . . DY./ASSTT. REGISTRAR , / ITAT, MUMBAI