DCIT, New Delhi V. M/s. L.T. Foods Ltd., New Delhi

ITA 4176/DEL/2010

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74196 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 10-12-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 09-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANAT KAPOO RADV
• Assessee Lawyers: S N BHATIA
• Keywords: Depreciation; Revenue expenditure
• Section: 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D: NEW DELHI BEFORE SHRI J. S. REDDY, ACCOUNTANT MEMBER AND SHRI A.T.VARKEY, JUDICIAL MEMBER I.T.A.NO.4176/DEL/2010 ASSESSMENT YEAR : 2006-07 DCIT VS. L. T. FOODS LTD. CENTRAL CIRCLE-19, A-21, GREEN PARK, ROOM NO.319 AUROBINDO MARG ARA CENTRE, E-2, JHANDEWALAN EXTENSION. NEW DELHI. NEW DELHI. PAN: AAACL0259K. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SANAT KAPOO R,ADV. RESPONDENT BY : SHRI S.N.BHATIA, D R. O R D E R PER J. S. REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE REVENUE AND IS DIREC TED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (AP PEALS)-VII, NEW DELHI DATED 03.06.2010.ON THE FOLLOWING GROUNDS: 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE CIT (A) HAS ERRED IN LAW AND ON FACTS IN DELETING T HE DISALLOWANCE OF RS.16,98,856/- ON ACCOUNT OF DEPRECIATION CLAIMED @ 100% ON WOODEN CRATES. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS ERRED IN LAW AND ON FACTS IN HOLDING ON CE A CLAIM HAS BEEN ALLOWED IN PRECEDING YEAR, IT CANNOT BE DISALLOWED IN SUBSEQUENT YEAR. 2 3. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS ERRED IN LAW AND ON FACTS IN DELETING T HE DISALLOWANCE OF RS.1,81,352/- MADE BY ASSESSING OFFICER U/S 36 (1) (VA) R.W.S. 2 (24) (X) ON ACCOUNT OF LATE PAYMENT OF EMPLOYEES CONTRIBUTION T OWARDS PROVIDENT FUND. 4. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS ERRED IN LAW AND ON FACTS IN HOLDING TH AT THE EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND IS ALLOWABLE U/ S 43B R. E. W. 36(1) (VA) WITHOUT APPRECIATING THE FACT THAT EMPLOYEES CONTRI BUTION TOWARDS PROVIDENT FUND IS TO BE DEALT WITH U/S 2(24) (X) R.E.W. 36 (1 ) (VA). 5. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEN D ANY/ ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING THE COURSE OF TH E HEARING OF THE APPEAL. 2. THE ASSESSEE IS A COMPANY AND IS ENGAGED IN THE BUSINESS OF MANUFACTURING, TRADING OF RICE AND MERCHANT EXPORTS . THE ASSESSEE CLAIMED DEPRECIATION ON WOODEN CRATES AND THE SAME WAS DISA LLOWED. 3. THE ASSESSING OFFICER ALSO DISALLOWED THE LATE P AYMENT OF EMPLOYEES ESI AND PF U/S 43(B). ON APPEAL THE FIRST APPELLATE AUTHORITY ALLOWED THE SAME. AGGRIEVED THE REVENUE IS IN APPEAL. 4. WE HAVE HEARD MR. S. N. BHATIA LD. DEPARTMENTAL REPRESENTATIVE AND MR. SANAT KR. LD. COUNSEL FOR THE ASSESSEE. THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT DEPRECIATION CANNOT B E ALLOWED AS THE ASSESSING OFFICER HAS GONE BY THE DEPRECIATION SCHE DULE. THE LD. COUNSEL FOR THE ASSESSEE AGREED THAT WOODEN CRATES ARE NOT MENTIONED IN THE DEPRECIATION SCHEDULE WHICH ALLOWS 100% DEPRECIATIO N. HE SUBMITTED THAT 3 THE ALTERNATIVE CLAIM OF THE ASSESSEE THAT THIS EXP ENDITURE IN THE REVENUE FIELD HAS BEEN ALLOWED BY THE LD. CIT (A). 5. THE ASSESSEE HAD SUBMITTED THAT THE EXPENSES ON WOODEN CRATES IS A REVENUE EXPENDITURE ON THE GROUND THAT THE LIFE IS OF SHORT DURATION AND AS IT IS A PACKING MATERIAL AND IT HAS NO INCOME GENERATI NG CAPACITY. THE LD. CIT (A) STATES THAT THE ASSESSING OFFICER HAS NOT QUEST IONED THE CLAIM OF ALLOWABILITY OF THE SAID EXPENDITURE. 6. KEEPING IN VIEW OF THE ABOVE, THE ALTERNATIVE CO NTENTION OF THE ASSESSEE RAISED BEFORE THE FIRST APPELLATE AUTHORIT Y AND ALSO THE FACT THAT THE WOODEN CRATES HAVE A LIMITED LIFE SPAN AND AS THEY ARE NOT AN INCOME GENERATING APPARATUS, WE ALLOW THE CLAIM AS REVENUE EXPENDITURE. IN THE RESULT GROUND NO.1AND 2 ARE DISMISSED. 7. GROUND NO. 3 AND 4 ARE COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE JURISDICTIONAL HIGH COURT. THUS, TH ESE GROUNDS ARE ALSO DISMISSED AND GROUND NO.5 IS GENERAL IN NATURE. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMISS ED. PRONOUNCED IN THE OPEN COURT ON 18 TH FEBRUARY, 2014 SD/- SD/- (A.T.VARKEY) (J. S. REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 18 TH FEBRUARY, 2014. 4 COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER DEPUTY REGISTRAR, ITAT. S. SINHA