M.P.Tourism Development Corporation , Bhopal, Bhopal V. Assistant Commissioner of Income Tax 2 (1), Bhopal

ITA 448/Ind/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 0104 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-12-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 14-06-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R S AMBEDKAR
• Assessee Lawyers: S S DESHPANDE
• Keywords: Depreciation
• Section: 143(3); 234B

Judgement Text

[ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] , , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.448/IND/2017 ASSESSMENT YEAR: 2012-13 M.P. TOURISM DEVELOPMEN T CORPORATION, BHOPAL / VS. ACIT - 2(1), BHOPAL ( APPELLANT ) ( REVENUE ) P.A. NO. AABCM0086A APPELLANT BY SHRI S.S. DESHPANDE, A.R. RESPONDENT BY SHRI R.S. AMBEDKAR, SR.D.R. DATE OF HEARING: 13.11.2018 DATE OF PRONOUNCEMENT: 06.12.2018 / O R D E R PER KUL BHARAT, J.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORDER O F THE CIT(A)-I, BHOPAL DATED 30.3.2017 PERTAINING TO THE [ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] 2 ASSESSMENT YEAR 2012-13. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL:- 2. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE HAD FILED ORIGINAL INCOME, WHEREIN IT HAS DECLARED INCOME AT RS.1,64,05,599/-, HOWEVER THIS RETURN WAS REVISED ON 30.3.2014 DECLARING INCOME AT RS.2,16,24,804/-. THE CASE OF THE ASSESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND [ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] 3 THE ASSESSMENT U/S 143(3) OF THE INCOME TAX ACT, 196 1 (HEREINAFTER CALLED AS THE ACT) WAS FRAMED. THE A.O. WHILE FRAMING THE ASSESSMENT REJECTED THE CLAIM OF THE ASSESS EE THAT EXPENSES INCURRED UNDER THE HEAD REPAIRS AND MAINTENACE ARE OF THE REVENUE NATURE. ACCORDINGLY, HE MADE ADDITION OF RS.2 CRORES IN THIS RESPECT. 3. AGGRIEVED BY THIS, THE ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A). LD. CIT(A) VIDE IMPUGNED ORDER PARTLY ALLOWED THE APPEAL DIRECTING THE ASSESSING OFFICER TO AL LOW DEPRECIATION AS PER LAW. HOWEVER, AGGRIEVED BY THE OR DER, THE ASSESSEE IS IN APPEAL. GROUND NOS.1 & 3 ARE AGAINST CONFIRMING THE DISALLOWANCE OF RS.2 CRORES. LD. COUN SEL FOR THE ASSESSEE VEHEMENTLY ARGUED THAT LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITIONS. HE SUBMITTE D THAT THE EXPENSES ARE OF THE REVENUE NATURE. [ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] 4 4. ON THE CONTRARY, LD. D.R. SUPPORTED THE ORDER OF THE LD. CIT(A) STATING THAT THE ISSUE IS COVERED BY THE D ECISION OF THE TRIBUNAL IN EARLIER ASSESSMENT YEARS. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIALS AVAILABLE ON RECORDS AND GONE THROUGH THE ORDER S OF THE AUTHORITIES BELOW. LD. CIT(A) IN PARA NOS.5, 6 & 7 OF HIS ORDER HAS DECIDED THE ISSUE BY OBSERVING AS UNDER : [ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] 5 [ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] 6 6. WE FIND THAT IN THE CASE OF THE ASSESSEE THIS TRIBU NAL IN ITA NOS.685/IND/2016 DATED 28.2.2017 HAS DECIDED T HE ISSUE BY OBSERVING AS UNDER: 6. REPLYING TO THE ABOVE, THE LEARNED CIT DR STRONG LY SUPPORTED THE ORDER OF THE ASSESSING OFFICER WHICH WAS CONFIRMED BY THE LEARNED CIT(A) BY PASSING THE IMPUGNED ORDER. HOWEVER, HE COULD NOT CONTROVERT THIS FACTUAL SITUATION THAT BY THE ORDER DATED 8.9.2016 OF ITAT, INDORE BENCH, FOR THE ASSESSMENT YEAR 2009-10, THE ISSUE HAS BEEN RESTORE D TO THE FILE OF THE ASSESSING OFFICER WITH THE FOLLOWING DIRECTIONS :- [ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] 7 14. THE FIRST GROUND TAKEN BY THE ASSESSEE IS THAT THE LEARNED CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ACTION O F THE ASSESSING OFFICER THAT THE SUM OF RS.1,31,81,008/- OUT OF TOT AL EXPENDITURE OF RS.2,36,51,306/- CLAIMED ON ACCOUNT OF BUILDING REP AIRS, OTHER REPAIRS & GARDEN MAINTENANCE ARE OF CAPITAL NATURE AND DISALLOWABLE. 15. THE ASSESSING OFFICER NOTICED THAT THE ASSESSE E COMPANY HAD CLAIMED EXPENSES ON BUILDINGS REPAIR AN D MAINTENANCE AMOUNTING TO RS.1,67,33,389/-.THE ASSES SING OFFICER NOTED THAT THE ASSESSEE HAD INCLUDED EXPENSES OF CA PITAL NATURE IN THE REPAIRS AND MAINTENANCE EXPENSES. THESE EXPENSE S. HOWEVER, THE ASSESSING OFFICER MADE THE ADDITION. ON APPEAL, THE LEARNED CIT(A) FOLLOWING THE DECISION OF THE CIT(A) FOR THE ASSESSMENT YEAR 2007-08 THE ASSESSING OFFICER DISALLOWED 48.12% OF THE EXPENDITURE TREATING THE SAME AS CAPITAL IN NATURE AND ADDED BA CK THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. ON APPEAL, THE LE ARNED CIT(A) CONSIDERING THE FACT THAT THE CIT(A) AND THE TRIBUN AL HAD CONFIRMED SIMILAR DISALLOWANCE IN THE EARLIER YEARS, CONFIRME D THE DISALLOWANCE MADE BY THE ASSESSING OFFICER. NOW THE ASSESSEE IS BEFORE US. 16. WE HAVE HEARD BOTH THE SIDES. WE FIND THAT THE TRIBUNAL HAS CONFIRMED THE SIMILAR DISALLOWANCE IN THE EARLIER Y EARS IN THE CASE OF THE ASSESSEE ITSELF. WE, THEREFORE, FIND NO FLAW IN THE ORDER OF THE LEARNED CIT(A) AND CONFIRM THE SAME. THIS GROUND IS , THEREFORE, REJECTED. 17. THE NEXT GROUND RELATES TO CONFIRMATION OF DEPR ECIATION BY THE LEARNED CIT(A) ON RS.1,13,81,008/- IN CASE THE SAID AMOUNT IS TREATED AS AN EXPENDITURE 18. WE HAVE HEARD BOTH THE SIDES. WE FIND THAT WH EN THE LEARNED CIT(A) IS JUSTIFIED IN TREATING THE EXPENDITURE OF RS.2,36,51,306/- AS BUILDING REPAIRS, OTHER REPAIRS AND GARDEN MAINTENA NCE AS CAPITAL IN NATURE, THEREFORE, THE ASSESSEE IS ENTITLED TO DEPR ECIATION AS PER LAW. WE, THEREFORE, SET ASIDE THE ORDERS OF THE AUTHORIT IES BELOW AND RESTORE THIS ISSUE TO THE FILE OF THE ASSESSING OFF ICER TO DECIDE THE SAME AS PER LAW AFTER GIVING THE ASSESSEE AN OPPORT UNITY OF BEING HEARD. 7. IN VIEW OF THE ABOVE, WE ARE OF THE VIEW THAT TH AT LEARNED CIT DR COULD NOT CONTROVERT THE FACTUAL SITUATION THAT THE IMPUGNED DISALLOWANCE OF BUILDING REPAIRS, GARDEN AND OTHERS HAS BEEN RESTRICTED TO 4 8.12% OF THE TOTAL EXPENDITURE FOR THE ASSESSMENT YEAR 2007-08, 2009-10 AND 2010-1 1 AND FOR THE ASSESSMENT YEAR 2009-10 THE CROSS OBJECTION OF THE ASSESSEE CH ALLENGING THE PART DISALLOWANCE OF 48.12% HAS BEEN REJECTED BY THE TRI BUNAL AND THE ISSUE HAS BEEN RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR THE LIMITED PURPOSE, BY OBSERVING THAT THE ASSESSEE IS ENTITLED TO DEPRECIA TION ON THE AMOUNT OF PART DISALLOWANCE AS PER THE PROVISIONS OF THE ACT AND T HUS THE ISSUE HAS BEEN [ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] 8 RESTORED TO THE FILE OF THE ASSESSING OFFICER TO DE CIDE THE SAME AFRESH AFTER AFFORDING DUE OPPORTUNITY OF HEARING TO THE ASSESSE E. RESPECTFULLY FOLLOWING THE ORDER OF THE COORDINATE BENCH OF THE TRIBUNAL DATED 8.9.2016 (SUPRA) IN THE ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2009-10 , THE ISSUE IS RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR THE LIMITED P URPOSE WITH THE DIRECTION THAT THE ASSESSEE IS ENTITLED TO DEPRECIATION AS PER LAW ON THE AMOUNT OF DISALLOWANCE AND THE ASSESSING OFFICER IS DIRECTED TO CALCULATE AND ALLOW THE SAME AS PER THE FACTS, CIRCUMSTANCES AND PROVISIONS OF THE ACT. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY DISALLOWED BY UPHOLDING THE DISALLOWANCE OF 48.12% OF TOTAL IMPUGNED EXPEND ITURE AND PARTLY ALLOWED FOR STATISTICAL PURPOSES ON THE ISSUE OF ALLOWABILITY O F DEPRECIATION ON THE AMOUNT OF DISALLOWANCE. 7. THERE IS NO CHANGE IN THE FACTS AND CIRCUMSTANCES IN THE PRESENT CASE. THE LD. CIT(A) HAS FOLLOWED THE DE CISION OF THE TRIBUNAL. THEREFORE, WE DO NOT SEE ANY INFIRM ITY IN THE ORDER OF THE LD. CIT(A) AND THE SAME IS HEREBY AFF IRMED. GROUND NOS.1 & 3 OF THE ASSESSEE ARE DISMISSED. 8. GROUND NO.2 IS IN RESPECT OF CHARGING OF INTEREST U/S 234B OF THE ACT. THIS BEING CONSEQUENTIAL, NO ARGUMEN T WAS ADDRESSED. WE THEREFORE, DISMISS THE SAME. 9. GROUND NO.4 IS GENERAL IN NATURE AND NEEDS NO SEPARATE ADJUDICATION. [ITA NO.448/IND/2017] [M.P. TOURISM DEVELOPMENT CORPORATION, BHOPAL] 9 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 06.1 2.2018. SD/- (MANISH BORAD) SD/- (KUL BHARAT) A CCOUNTANT MEMBER JUDICIALMEMBER INDORE; DATED : 06/12/2018 VG/SPS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE