DCIT, New Delhi V. M/s. BIC Logistics Ltd., New Delhi

ITA 520/DEL/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3654 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2010
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 30-06-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 04-02-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: P C GUPTA
• Assessee Lawyers: N O N E
• Keywords: Depreciation
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A DELHI BEFORE SHRI RAJPAL YADAV AND SHRI K.G. BANSAL ITA NO.520(DEL)/2010 ASSESSMENT YEAR: 2005-06 DEPUTY COMMISSIONER OF INCOME BIC LO GISTICS LTD., TAX, CIRCLE 3(1), NEW DELHI. VS. SU NFLOWER FARMS, NH-8, KAPASHERA, NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI P.C. GUPTA, SR. DR RESPONDENT BY: NO NE ORDER PER K.G. BANSAL : AM THIS APPEAL OF THE REVENUE EMANATES FROM THE ORDER OF CIT(APPEALS)-VI, NEW DELHI, PASSED ON 11.11.2009 IN APPEAL NO. 207/07- 08, AND IT PERTAINS TO ASSESSMENT YEAR 2005-06 . THE CORRESPONDING ORDER OF ASSESSMENT WAS FRAMED BY THE ASSTT. C OMMISSIONER OF INCOME- TAX, CIRCLE 3(1), NEW DELHI, ON 24.09.2007 UNDE R THE PROVISIONS OF SECTION 143(3) OF THE INCOME-TAX ACT, 1961. THE R EVENUE HAS TAKEN THE FOLLOWING TWO GROUNDS IN THE APPEAL:- (I) ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) ERRED IN LAW AND ON FACTS BY ALLOWING T HE DEPRECIATION @ 60% ON COMPUTER PERIPHERALS AND ACCESSORIES A MOUNTING TO ITA NO. 520(DEL)/2010 2 RS. 35,720/- THOUGH THE IT RULES ALLOWS 60% DEPRECIATION ON COMPUTER AND COMPUTER SOFTWARE. (II) ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN ALLOWING RELIEF TO THE ASSESSEE COMPANY OF RS. 14,85,907/- ON ACCOUNT OF EMPLOYEES CONTRIBUTION TO ESI AND PF BY HOLDING THAT THE CONTRIBUTIONS ARE DEPOSITED BEFORE THE DUE DATE OF FILING OF RETU RN. THE LD. CIT(A) HAS FAILED TO APPRECIATE THAT DUE DATE AS PER SECTION 36(1)(VA) MEANS- THE DATE BY WHICH THE ASSESSEE IS REQUIRED AS AN EMPLOYER TO CREDIT AN EMPLOYERS CONTRIBUTION TO THE EMPLOYEES ACCOUNT IN THE RELEVANT FUND WHICH IS MUCH BEFORE THE DATE OF FILING OF RETURN. 2. THE CASE WAS FIXED FOR HEARING ON 30.06.2010 . NONE ATTENDED ON BEHALF OF THE ASSESSEE. HOWEVER, THE FACTS OF THE CASE WERE EXPLAINED TO US BY THE LD. SENIOR DR. 3. GROUND NO. 1 IS REGARDING GRANT OF DEPRECIATI ON @ 60% NOT ONLY ON COMPUTER AND COMPUTER SOFTWARE BUT ALSO ON COMPU TER PERIPHERALS AND ACCESSORIES. THE FINDING OF THE LD. CIT(APPEALS ) IS THAT THE COMPUTER ACCESSORIES AND PERIPHERALS ARE INTEGRAL PART OF THE COMPUTER, ENTITLED TO DEDUCTION @ 60% OF THE COST OR THE WDV, AS THE CASE MAY BE. THIS IS BASED UPON THE DECISION OF DELHI AND KOLKATA BEN CHES OF THE TRIBUNAL. THE CASE OF THE LD. DR IS THAT THE UPS CANNOT B E SAID TO BE EITHER COMPUTER OR COMPUTER SOFTWARE. IT IS REMOTELY CO NNECTED WITH THE COMPUTER AND, THEREFORE, DEPRECIATION SHOULD HAVE BEEN ALLOWED AT THE ITA NO. 520(DEL)/2010 3 NORMAL RATE AND NOT AT 60%. WE TEND TO AGREE WITH HIM AND HOLD THAT THE ASSESSEE IS NOT ENTITLED TO ACCELERATED RA TE OF DEPRECIATION IN RESPECT OF THE UPS. 3.1 THUS, GROUND NO. 1 IS PARTLY ALLOWED. 4. GROUND NO. 2 IS REGARDING DEDUCTION OF A SUM OF RS. 14,85,907/- DEPOSITED LATE BY THE ASSESSEE WITH THE PROVIDENT FUND COMMISSIONER IN RESPECT OF EMPLOYEES CONTRIBUTION TO ESI AND PF . HOWEVER, THIS AMOUNT WAS DEPOSITED BEFORE THE DUE DATE OF FILING THE RETURN OF INCOME U/S 139(1). 4.1 THE CASE OF THE REVENUE IN THE GROUND IS THA T THIS MONEY SHOULD HAVE BEEN DEPOSITED BEFORE THE DUE DATE AS UNDE RSTOOD U/S 36(1)(VA). HOWEVER, THE LD. CIT(APPEALS), BY RELYING ON TH E DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. P.M. ELE CTRONICS LTD. IN ITA NO. 475/2007 DATED 3.11.2008, HELD THAT THE AMOUNT IS DEDUCTIBLE IN COMPUTING THE INCOME AS IT HAS BEEN PAID BEFORE THE DUE DATE OF FILING THE RETURN OF INCOME U/S 139(1). IN VIEW OF C LEAR DECISION OF THE JURISDICTIONAL HIGH COURT IN THE MATTER, THE LD. DR ALSO DID NOT HAVE MUCH TO SAY. OTHERWISE, THE GROUND IS SQUARE LY COVERED BY THE AFORESAID ITA NO. 520(DEL)/2010 4 DECISION OF THE JURISDICTIONAL HIGH COURT. FOLLO WING THE SAME, IT IS HELD THAT THE ASSESSEE WAS ENTITLED TO DEDUCT THIS A MOUNT IN COMPUTING THE TOTAL INCOME OF THIS YEAR. 4.2 THUS, THIS GROUND IS DISMISSED. 5. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT ON 9 JULY, 2010. SD/- SD/- (RAJPAL YADAV) (K.G.BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE OF ORDER: 9TH JULY,2010. SP SATIA COPY OF THE ORDER FORWARDED TO:- BIC LOGISTICS LTD., NEW DELHI. DY. CIT, CIRCLE 3(1), NEW DELHI. CIT(A) CIT THE DR, ITAT, NEW DELHI. ASSISTANT REGISTRAR.