ITO (E), New Delhi V. M/s. Vishweshraiya Educational Trust, Delhi

ITA 5200/DEL/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6590 (ITAT-DELHI)
• Duration Of Justice: 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-11-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC 1
• Next Hearing Date: 24-11-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 03-10-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; Business income; Depreciation; Retrospective amendment; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-1 : NEW DELHI BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER ITA NO.5200/DEL/2016 ASSESSMENT YEAR : 2010-11 ITO (E), WARD 2(3), ROOM NO.2407, E-2 BLOCK, DR. SP MUKHERJEE CIVIC CENTRE, NEW DELHI. VS. VISHWESHRAIYA EDUCATIONAL TRUST, 115, PUSHKAR ENCLAVE, PASCHIM VIHAR, DELHI. PAN: AAATV1979P (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY : NONE DATE OF HEARING : 24.11.2016 DATE OF PRONOUNCEMENT : 24.11.2016 ORDER THIS APPEAL BY THE ASSESSEE RELATING TO THE ASSESS MENT YEAR 2010- 11 ARISES OUT OF THE ORDER PASSED BY THE CIT (APPE ALS) 20.07.2016. 2. NONE WAS PRESENT FOR THE ASSESSEE AS WELL AS THE REVENUE. I FIND THAT PURSUANT TO THE MANDATE OF SECTION 268A , THE CBDT ITA NO.5200/DEL/2016 2 HAS ISSUED CIRCULAR NO. 21 OF 2015 DATED 10.12.2015 WITH RETROSPECTIVE EFFECT, REVISING THE MONETARY LIMIT T O RS.10,00,000/- FOR NOT FILING APPEALS BEFORE THE TR IBUNAL. I FURTHER FIND THAT AS THE TAX EFFECT INVOLVED IN THE INSTANT APPEAL IS LESS THAN RS.10,00,000/-, THE EXTANT APPEAL IS N OT MAINTAINABLE. 3. FROM PARA 10 OF THE ABOVE CIRCULAR IT IS PALPABL E THAT THE INSTRUCTION IS APPLICABLE TO THE PENDING APPEALS AL SO WITH RETROSPECTIVE EFFECT AND THERE IS A CLEAR-CUT DIREC TION TO THE DEPARTMENT TO WITHDRAW OR NOT PRESS SUCH APPEALS FI LED BEFORE THE ITAT WHEREIN TAX EFFECT IS LESS THAN RS.10,00,0 00/-. GOING BY THE PRESCRIPTION OF THE AFORENOTED CIRCULAR, I A M OF THE VIEW THAT THE REVENUE SHOULD HAVE EITHER NOT FILED THE I NSTANT APPEAL BEFORE THE TRIBUNAL OR WITHDRAWN THE SAME AS THE TA X EFFECT IN THIS APPEAL IS LESS THAN THE PRESCRIBED LIMIT FOR N OT FILING THE APPEALS. EX CONSEQEUNTI, I DISMISS THE INSTANT APPEAL. ITA NO.5200/DEL/2016 3 4. EVEN OTHERWISE, IT IS NOTICED THAT THE ISSUE RAI SED IN THIS APPEAL ABOUT THE GRANTING OF DEPRECIATION IN ADDITI ON TO THE ALLOWANCE FOR PURCHASE OF ASSETS AS APPLICATION, HA S BEEN DECIDED BY THE HONBLE DELHI HIGH COURT IN THE CASE OF DIT(E) VS. INDRAPRASTHA CANCER SOCIETY (2014) 112 DTR 345 (DEL), HOLDING THAT CLAIM FOR DEPRECIATION SHALL BE ALLOWE D AS PER THE PRINCIPLES RELATING TO COMMERCIAL ACCOUNTANCY WHILE COMPUTING BUSINESS INCOME, IN ADDITION TO THE AMOU NT SPENT ON PURCHASE OF CAPITAL ASSET BEING TREATED AS APPLI CATION OF INCOME. IT IS FURTHER OBSERVED THAT THE FINANCE (NO .2) ACT, 2014 HAS INSERTED SECTION 11(6) W.E.F. 1.4.2015 PRO VIDING THAT NO DEPRECIATION ON AN ASSET CAN BE ALLOWED ONCE ITS PURCHASE HAS BEEN TREATED AS APPLICATION OF INCOME. SINCE T HE YEAR UNDER CONSIDERATION IS AY 2010-11, I AM SATISFIED T HAT THE CASE IS NOT HIT BY THE NEWLY INSERTED SECTION 11(6). I, THEREFORE, UPHOLD THE IMPUGNED ORDER. ITA NO.5200/DEL/2016 4 5. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. THE DECISION WAS PRONOUNCED IN THE OPEN COURT ON 2 4 TH NOVEMBER, 2016. SD/- [R.S. SYAL] ACCOUNTANT MEMBER DATED, 24.11.2016. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.