M/s. Shri Nath Ji Trust, Noida V. DCIT (E), Uttar Pradesh

ITA 5490/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4761 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 11-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RUPINDER KR AGGARWAL
• Keywords: Depreciation
• Section: 143(3); 12; 11

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B: NEW DELHI BEFORE SHRI I.C.SUDHIR, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 5490/DEL/2015 (ASSESSMENT YEAR: 2012 - 13 ) SHRI NATH JI TRUST, C/O. SHRI RUPINDER KUMAR AGGARWAL, ADVOCATE, B - 1/A - 22, SECTOR - 51, NOIDA PAN:AAVTS8150Q VS. DCIT(E), CIRCLE GHAZIABAD, UTTAR PRADESH (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RUPINDER KR. AGGARWAL, ADV REVENUE BY: SHRI ANSHU PRAKASH, SR. DR DATE OF HEARING 06/09 / 2017 DATE OF PRONOUNCEMENT 13 / 09 / 2017 O R D E R PER PRASHANT MAHARISHI , A. M. 1. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD CIT ( A), GHAZIABAD DATED 14.07.2015 FOR THE ASSESSMENT YEAR 2012 - 13. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THAT THE ORDER OF THE AUTHORITIES BELOW IN DISALLOWING CLAIM OF DEPRECIATION AMOUNTING TO RS. 22621801/ - IS AGAINST LAW AND FACTS OF THE CASE AND THE SAME BE ALLOWED. 2. AS CLAIMED ABOVE DEPRECIATIO N OF RS. 22621801/ - BE ALLOWED. 3. ASSESSEE IS A TRUST, WHICH IS REGISTERED UNDER SECTION 12 AA OF THE INCOME TAX ACT . IT ALSO ENJOYS THE PRECOGNITION CERTIFICATE FOR EXEMPTION UNDER SECTION 80 G OF THE INCOME TAX ACT . IT IS ENGAGED IN RUNNING THE EDUCATIONAL INSTITUTIONS. IT FILED ITS RETUR N OF INCOME DECLARING NIL INCOME ON 24/09/2012 AND THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS FOUND THAT THE ASSESSEE HAS CLAIMED A DEDUCTION OF RS. 2262101/ - IN ITS INCOME AND EXPENDITURE ACCOUNT UNDER THE HEAD DEPRECIATION. THEREFORE, THE LD. ASSESSING OFFICER ISSUED THE SHOW CAUSE NOTICE TO THE ASSESSEE STATING THAT WHEN THE ORIGINAL APPLICATION OF THE INCOME WAS ALLOWED WHEN THE ASSETS WERE PURCHASED THEN ALLOW ING THE DEPRECIATION ONCE AGAIN ALSO THE DOUBLE DEDUCTION. ASSESSEE REPLIED THAT THAT INCOME OF THE TRUST IS REQUIRED TO BE COMPUTED ON THE COMMERCIAL PRINCIPLE AND THEREFORE THE TRUST MUST BE ALLOWED THE DEDUCTION/ALLOWANCE OF DEPRECIATION ON PAGE NO. 2 ITS ASSETS. THE LD. ASSESSING OFFICER DID NOT ACCEPT THE EXPLANATION OF THE ASSESSEE AND D ISALLOWED AND APPRECIATION OF RS. 22621801/ - AND FRAMED ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT V IDE ORDER DATED 23/10/2013. ASSESSEE, AGGRIEVED WITH THE ORDER OF T HE LD. ASSESSING OFFICER, PREFERRED AN APPEAL BEFORE THE LD. CIT (A) WHO V IDE ORDER DATED 14/07/2015 DISMISSED THE APPEAL OF THE ASSESSEE, BUT DIRECTED THE LD. AO TO GRANT DEDUCTION OF 85% OF THE INCOME OF THE ASSESSEE AND TO ALLOW THE ACCUMULATION OF BALA NCE 15% IN ACCORDANCE WITH SECTION 11 AND 13 OF THE INCOME TAX ACT . THE ASSESSEE BEING AGGRIEVED WITH THE ORDER OF THE LD. CIT (A) HAS PREFERRED AN APPEAL BEFORE US. 4. LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT NOW THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE HONBLE DELHI HIGH COURT IN CASE OF DIT VS. INDRAPRASTHA CANCER SOCIETY AS WELL AS THE DECISION OF THE HONBLE DELHI HIGH COURT IN ITA NO. 375/2016 DATED 29/05/2017 IN CASE OF FASHION DESIGN COUNCIL OF INDIA. 5. THE LD. DE PARTMENTAL REPRESENTATIVE VEHEMENTLY SUPPORTED THE ORDERS OF THE LOWER AUTHORITIES. 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS WHETHER THE ASSESSEE IS ENTITL ED TO DEPRECIATION ON THE ASSETS WHEN THE COST OF THOSE ASSETS AS ALREADY BEEN ALLOWED AS DEDUCTION TO THE ASSESSEE IS AN APPLICATION OF TOTAL INCOME. RECENTLY HONBLE DELHI HIGH COURT IN CASE OF CIT VS. FASHION DESIGN COUNCIL OF INDIA IN ITA NO. 375/2016 DATED 29/05/2017. SUCH DEDUCTION IS ALLOWABLE TO THE ASSESSEE FOR DEPRECIATION EVEN IF THE FULL COST OF SUCH ASSETS HAVE BEEN ALLOWED AS AN APPLICATION OF TOTAL INCOME. THEREFORE WE REVERSE THE FINDING OF THE LOWER AUTHORITY AND DIRECT THE LD. ASSESSING OF FICER TO ALLOW THE CLAIM OF THE ASSESSEE OF DEPRECIATION ON THE ASSETS THOUGH FULL COST OF THOSE ASSETS HAVE BEEN ALLOWED TO THE ASSESSEE IS AN APPLICATION OF INCOME. IN VIEW OF THIS SOLITARY GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 7. IN THE RESULT APPEA L OF THE ASSESSEE IS ALLOWED. ORDER PR ONOUNCED IN THE OPEN COURT ON 1 3 / 0 9 / 2017 . - S D / - - S D / - ( I.C.SUDHIR ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 3 / 0 9 / 2017 A K KEOT COPY FORWARDED TO PAGE NO. 3 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI