R.L. Steel and Energy Pvt. Ltd., New Delhi V. Addl. CIT, New Delhi

ITA 5784/DEL/2012

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3777 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 01-06-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 12-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; Depreciation; Difference of opinion
• Section: 143(3); 194C

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F : NEW DELHI BEFORE SHRI AMIT SHUKLA , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 5784 & 5785 /DEL/2012 (ASSESSMENT YEAR: 2007 - 08 AND 2008 - 09 ) & ITA NO. 1838 /DEL/ 2013 (ASSESSMENT YEAR: 2009 - 10 ) RL STEEL AND ENERGY PVT LTD, MITTAL BHAWAN, 70 DARYA GANJ, NEW DELHI PAN:AAACR5809B VS. ADDL. CIT, RANGE - 15, CR BUILDING, IP ESTATE, NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RANJAN CHOPRA, CA REVENUE BY: SHRI ATIQ AHMAD, SR. DR DATE OF HEARING 09/11/ 2017 DATE OF PRONOUNCEMENT 05 / 0 2 / 2018 O R D E R PER PRASHANT MAHARISHI , A. M. 1. TH ESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD CIT(A) - XVIII, NEW DELHI DATED 16.08.2012 FOR THE ASSESSMENT YEAR 2007 - 08 TO 2009 - 10. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL IN ITA NO. 5784/DEL/2012 FOR THE ASSESSMENT YEAR 2007 - 08: - 1. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LEARNED COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF DEPRECIATION @ 80% IN RESPECT OF ADDITION OF PLANT & MACHINERY - RE - HEATING FURNACE . 2. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LD COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF DEPRECIATION @ 100% IN RESPECT OF ADDITION OF PLANT & MACHINERY - POLLUTION EQUIPMENT. 3. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LEARNED COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF CRANE HIRE CHARGES PAID TO M/S. OMI PATEL INSPITE OF THE FACT THAT I DS HAS BEEN DEDUCTED U/S 194C RL STEEL AND ENERGY PVT LTD,VS ADDL. CIT, ITA NO. 5784 & 5785/DEL/2012 & 1838/DEL/2013 (ASSESSMENT YEAR: 2007 - 08, 20 08 - 09 AND 2009 - 10) PAGE | 2 4. THAT THE DISALLOWANCE MADE ARC A RBITRARY ILLEGAL UNJUSTIFIED. 5. THAT THE ENTIRE ASSESSMENT ORDER IS WRONG ARBITRARY ILLEGAL UNJUST AGAINST THE FACTS AS WELL AS AGAINST THE LAWS. 3. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL IN ITA NO. 5785/DEL/2012 FOR THE ASSESSMENT YEAR 20 08 - 09: - 1. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LEARNED COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF DEPRECIATION @ 80% IN RESPECT OF ADDITION OF PLANT & MACHINERY - RE - HEATING FURNACE . 2. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LD COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF DEPRECIATION @ 100% IN RESPECT OF ADDITION OF PLANT & MACHINERY - POLLUTION EQUIP MENT. 3. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LEARNED COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF CRANE HIRE CHARGES PAID TO M/S. OMI PATEL INSPITE OF THE FACT THAT T DS HAS BEEN DEDUCTED U/S 194C 4. THAT THE DISALLOWANCE MADE ARC ARBITRARY ILLEGAL UNJUSTIFIED. 5. THAT THE ENTIRE ASSESSMENT ORDER IS WRONG ARBITRARY ILLEGAL UNJUST AGAINST THE FACTS AS WELL AS AGAINST THE LAWS. 4. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APP EAL IN ITA NO. 1838/DEL/2013 FOR THE ASSESSMENT YEAR 2009 - 10: - 1. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LEARNED COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF DEPRECIATION @ 80% I N RESPECT OF PLANT & MACHINERY - RE - HEATING FURNACE. 2. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LEARNED COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF DEPRECIATION @ 100% IN RESPECT OF PLANT & MACHINERY - POLLUTION EQUIPMENT, INSPITE OF THE FACT THAT THE LD. A.O. HAS ALREADY ACCEPTED THE EXISTENCE OF THE SAID PLANT & MACHINERY AT THE FACTORY & THE GENUINENESS OF THE PURCHASES OF THE SAID PLANT & MACHINERY AFTER CROSS VERIFICATION FROM THE SUPPLIERS. 3. THAT THE LEARNED ASSESSING OFFICER AS WELL AS LEARNED COMMISSIONER OF INCOME TAX (APPEAL) HAVE FAILED TO APPRECIATE AND HAVE WRONGLY DISALLOWED THE CLAIM IN RESPECT OF CRANE HIRE CHARGES PAID TO M/S. OMI PATEL INSPITE OF THE FACT THAT TD S HAS BEEN DEDUCTED U/S 194C. RL STEEL AND ENERGY PVT LTD,VS ADDL. CIT, ITA NO. 5784 & 5785/DEL/2012 & 1838/DEL/2013 (ASSESSMENT YEAR: 2007 - 08, 20 08 - 09 AND 2009 - 10) PAGE | 3 4. THAT THE LD. A.O. AS WELL AS LD. CIT HAVE FAILED TO ALLOW THE DEPRECIATION ON THE AMOUNT OF DEPRECIATION DISALLOWED IN THE EARLIER YEARS ON THE GROUND NOT PUT TO USE. 5. THAT THE DISALLOWANCE MADE ARE ARBITRARY ILLEGAL UNJU STIFIED. 6. THAT THE ENTIRE ASSESSMENT ORDER IS WRONG ARBITRARY ILLEGAL UNJUST AGAINST THE FACTS AS WELL AS AGAINST THE LAW. 5. TO STATE PRECISELY THE FACTS OF THE CASE FOR AY 2007 - 08 IS THAT THE ASSESSEE IS A COMPANY WHO FILED ITS RETURN OF INCOME ON 30.10 .2009 SHOWING INCOME OF RS. 42619135/ - . THE ASSESSMENT U/S 143(3) OF THE INCOME TAX ACT WAS MADE ON TOTAL INCOME OF RS. 65697700/ - ON 31.03.2009. THE ASSESSEE PREFERRED APPEAL BEFORE THE LD CIT(A), WHO DISMISSED THE APPEAL OF THE ASSESSEE. THEREFORE, THE A SSESSEE IS IN APPEAL BEFORE US. 6. THE FIRST GROUND OF APPEAL IS WITH RESPECT TO CLAIM OF DEPRECATION OF RE - HEA T ING FURNACE @80%. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT IS NOTED THAT THE ASSESSEE HAS PURCHASE D RE - HEATING FURNACE OF RS. 35166961/ - ON WHICH THE ASSESSEE HAS CLAIMED DEPRECIATION @80% FOR SIX MONTHS AND 20% FOR ANOTHER SIX MONTHS. THE LD AO STATED THAT 80% DEPRECATION IS AVAILABLE ONLY ON ENERGY SAVING DEVI C ES. THE ASSESSEE SUBMITTED THAT RE - HEATING FURNACE ARE ENERGY SAVING DEVI C E. IT WAS STATED THAT THERE IS SAVING OF POWER UNIT PER METRIC TON AND THEREFORE ASSESSEE ALSO GAVE THE DETAILS OF TOTAL COST SAVED ON ACCOUNT OF PURCHASE OF THESE DEVI C ES. THE LD AO IN TURN HELD THAT THERE IS INCREASE OF POWER AND FUEL CHARGES FROM RS. 30.29 CR ORES TO RS. 46.38 CRORES AND THEREFORE, ASSESSEE HAS FAILED TO ESTABLISH THAT DUE TO THIS ENERGY SAVING DEVICE THERE IS POWER SAVING. THEREFORE, DEPRECIATION OF RS. 7088965/ - WAS DISALLOWED. THE LD CIT(A) ALSO CONFIRMED THE FINDING OF THE LD AO. BEFORE THE LD CIT(A) THE ASSESSEE CLAIMED BY SUBMITTING THE REPORT OF CHARTERED ENGINEER WHICH CERTIFIES THAT RE - HEATING FURNACE IS A PUSHER TYPE RE - HEA T ING FURNACE AND FALLS UNDER THE CATEGORY OF MACHINERY OF PLANT - III(8)(IX)(B) TYPE FOR CLAIMING OF DEPRECATION. TH EREFORE, THE ASSESSEE IS IN APPEAL BEFORE US. RL STEEL AND ENERGY PVT LTD,VS ADDL. CIT, ITA NO. 5784 & 5785/DEL/2012 & 1838/DEL/2013 (ASSESSMENT YEAR: 2007 - 08, 20 08 - 09 AND 2009 - 10) PAGE | 4 7. THE LD AR SUBMITTED THAT IDENTICAL ISSUE HAS BEEN CONSIDERED BY THE COORDINATE BENCH IN THE CASE OF RATHI SUPER STEEL LTD VS. ADDLL. CIT, ITA NO. 5858/DEL/20012 FOR AY 2009 - 10, WHEREIN, IDENTICAL FACTS AND CIR CUMSTANCES THE ISSUE IS SENT BACK TO THE FILE OF THE LD AO VIDE PARA NO. 6 OF THAT ORDER. 8. THE LD DR SUPPORTED THE ORDER OF THE LOWER AUTHORITIES. 9. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND ALSO PERUSED THE ORDERS OF THE LOWER AUTHORITIES. THE SIMPLE ISSUE BEFORE US IS THAT WHETHER THE RE - HEATING FURNACE PURCHASED BY THE ASSESSEE ARE ENTITLED FOR DEPRECIATION @80% OR NOT . COORDINATE BENCH IN RATHI SUPER STEEL LTD (SUPRA) HAS CONSIDERED THE IDENTICAL ISSUE AND THE CASE OF THE ASSESSEE BEFORE US I S SIMILAR, THEREFORE, RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH IN PARA NO. 6 WHICH IS UNDER: - 6. THERE IS NOTHING DECISIVE IN THE ASSESSMENT OR THE IMPUGNED ORDER TO DEMONSTRATE THAT THE ASSET IN QUESTION IS, IN FACT, AN ENERGY SAVING D EVICE, WHICH IS PRE - REQUISITE CONDITION FOR CLAIMING DEPRECIATION AT A HIGHER RATE. ON A SPECIFIC QUERY, THE LD AR COULD NOT FURNISH THE DETAIL OF TOTAL AMOUNT OF RS. 14.51 CRORES AND ODD CLAIMED TO HAVE BEEN INCURRED ON REHEATING FURNACE. IN OUR CONSIDE RED OPINION, THE ENDS OF JUSTICE WOULD MEET ADEQUATELY IF THE IMPUGNED ORDER IS SET ASIDE AND THE MATTER IS RESTORED TO THE FILE OF AO. WE ORDER ACCORDINGLY AND DIRECT THE AO TO VERIFY THE DETAILS OF THE TOTAL SUM CAPITALIZED AT RS. 14.51 CRORE WITH A VIEW TO ASCERTAIN IF THE ENTIRE AMOUNT CAPITALIZED IS TOWARDS REHEATING FURNACE AS CLAIMED BY THE ASSESSEE. ONCE THIS DETAIL IS CHECKED UP, THEN THE ONUS WOULD BE ON THE ASSESSEE TO ADDUCE SOME TECHNICAL EXPERTS OPINION ETC. DIVULGING THE TRUE NATURE OF THE A SSET PRODUCED, BEING A REHEATING FURNACE OR OTHERWISE. THE AO, IF NOT SATISFIED WITH THE EXPERTS REPORT FURNISHED BY THE ASSESSEE, MAY ALSO SEEK AN EXPERT OPINION AT HIS OWN END. IF THE ASSESSEES CONTENTION IS FOUND TO BE CORRECT THAT THE CAPITAL ASSET IS NOTHING BUT AN ENERGY SAVING DEVICE, THEN DEPRECATION SHOULD BE ALLOWED AT THE HIGHER RATE. THE MERE FACT THAT THE CONSUMPTION OF FUEL AND POWER HAS NOT WITNESSED A DECLINING TREND IN THAT YEAR, CANNOT BE A CRITERIA TO JUDGE THE ALLOWABILITY OR OTHERWIS E OF DEPRECATION AT HIGHER RATE. 10. WE SET ASIDE THE WHOLE ISSUE BACK TO THE FILE OF THE LD AO TO VERIFY THE REPORT OF THE EXPERT FURNISHED BY THE ASSESSEE AND IF FOUND IN ACCORDANCE WITH LAW TO GRANT DEPRECIATION ACCORDINGLY. RL STEEL AND ENERGY PVT LTD,VS ADDL. CIT, ITA NO. 5784 & 5785/DEL/2012 & 1838/DEL/2013 (ASSESSMENT YEAR: 2007 - 08, 20 08 - 09 AND 2009 - 10) PAGE | 5 11. THE SECOND GROUND OF APPEAL IS WITH RESPECT TO CLAIM OF DEPRECATION @100% ON CERTAIN POLLUTION CONTROL EQUIPMENTS. THE ASSESSEE PURCHASED EQUIPMENTS FROM M/S. RAVI CONSTRUCTION ENGINEERS AND CONTRACTORS OF RS. 15723584/ - . HOWEVER, DURING THE COURSE OF ASSE SSMENT PROCEEDING THE ASSESSEE COULD NOT PRODUCE THE BILLS SHOWING THE PURCHASE OF THIS EQUIPMENT. THEREFORE, THE LD AO REQUESTED THE CONCERNED AO OF THE SUPPLIER OF THE MACHINERY TO PROVIDE THE INFORMATION. ON ENQUIRY CONDUCTED BY THAT OFFICER THE SUPPLIE R DID NOT RESPOND AND THEREFORE, THE ASSESSEE WAS ISSUED SHOW CAUSE NOTICE TO WHICH THE ASSESSEE SUBMITTED THAT THE SUPPLIER ATTENDED AND ALSO FURNISHED THE DETAILS OF INFORMATION TO THE LD AO. CONSEQUENTLY, THE SUMMONS WERE ISSUED TO THE SUPPLIERS WHICH W AS NOT COMPLIED WITH. IN VIEW OF THIS IN ABSENCE OF GENUINENESS OF THE TRANSACTION AS THE PURCHASE OF THE MACHINERY REMAINED UNVERIFIABLE THE LD AO DISALLOWED THE DEPRECATION OF RS. 11217075/ - . THE ISSUE WAS AGITATED BEFORE THE LD CIT(A). DURING THE APPELL ATE PROCEEDINGS THE ASSESSEE SUBMITTED THE CERTIFICATE OF ENGINEER ALONG WITH PHOTO COPIES OF THE INVOICES . THE LD CIT(A) ACCEPTED THE VERIFIABLE CLAIM OF THE ASSESSEE BUT REMANDED THE MATTER BACK TO THE FILE OF THE LD AO FOR ELIGIBILITY OF 100% DEPRECIATI ON ON THE MACHINERY. THE LD AO HELD THAT WATER TREATMENT PLANT OF THE ASSESSEE IS NOT ELIGIBLE FOR 100% DEPRECATION. THEREFORE, HE UPHELD THE DISALLOWANCE . 12. THE LD AR VEHEMENTLY SUBMITTED AO DISBELIEV ED THE CERTIFICATE OF THE CHARTERED ENGINEER WITHOUT ANY BASIS . HE STATED THAT DETAILS OF THE PURCHASE HAVE ALREADY BEEN PROVIDED AND ACCEPTED BY THE LD CIT(A). HE FURTHER REFERRED TO THE PAPER BOOK AT PAGE NO. 3 WHEREIN, HE HAS GIVEN DETAILED DESCRIPTION OF THE WATER POLLUTION CONTROL EQUIPMENT. HE ALSO REFERR ED TO THE REPORT OF ITI FOR THE CLAIM. HE ALSO REFERRED TO THE BILLS OF POLLUTION CONTROL EQUIPMENT AND THEREFORE HE STATED THAT THE ASSESSEE IS ENTITLED TO DEPRECATION THEREIN. 13. THE LD DR VEHEMENTLY SUPPORTED THE ORDERS OF THE LOWER AUTHORITIES. 14. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND ALSO PERUSED THE ORDERS OF THE LOWER AUTHORITIES. ADMITTEDLY NOW THE PURCHASE OF THE RL STEEL AND ENERGY PVT LTD,VS ADDL. CIT, ITA NO. 5784 & 5785/DEL/2012 & 1838/DEL/2013 (ASSESSMENT YEAR: 2007 - 08, 20 08 - 09 AND 2009 - 10) PAGE | 6 EQUIPMENTS HAS BEEN VERIFIED BY THE LOWER AUTHORITIES THEREFORE, THE PURCHASE ARE NOW VERIFIED AND GENUINENESS WAS ESTABLISH ED BY THE ASSESSEE. NOW THE ONLY ISSUE REMAIN IS WITH RESPECT TO FACT THAT WHETHER THE EQUIPMENTS PURCHASED BY THE ASSESSEE ARE POLLUTION CONTROL EQUIPMENT ELIGIBLE FOR 100% DEPRECIATION OR NOT. ASSESSEE HAS SUBMITTED THE REPORT OF CHARTERED ENGINEER WHICH SAYS THAT EQUIPMENT PURCHASED BY THE ASSESSEE ARE POLLUTION CONTROL EQUIPMENT. THE LD AO HAS NOT BELIEVE D THE FACT THAT THE ASSESSEE HAS PURCHASED POLLUTION CONTROL DESPITE THERE BEING A CERTIFICATE OF AN EXPERT. IN OUR VIEW THE FACT ARE SIMILAR TO THE CL AIM OF THE ASSESSEE OF DEPRECATION ON RE - HEATING FURNACE. HENCE, WE ALSO DIRECT THE LD AO TO EXAMINE THE CERTIFICATE OF EXP ER T AND ALLOW THE CLAIM OF THE ASSESSEE ON DEPRECATION @100% , IF FOUND IN ACCORDANCE WITH LAW. FURTHER, THE LD AO SHOULD NOT DISREGARD THE ABOVE CERTIFICATE OF AN EXPERT WITHOUT ANY COGENT REASON OR SIMILAR OPINION OF EXPERT. ACCORDINGLY, GROUND NO. 2 OF THE APPEAL OF THE ASSESSEE IS ALLOWED WITH ABOVE DIRECTION. 15. THE GROUND NO. 3 IS WITH RESPECT TO DISALLOWANCE OF EXPENDITURE INCURRED BY THE ASSESSEE ON ACCOUNT OF HIRE OF CRANE. THE ASSESSEE HAS DEDUCTED TAX AT SOURCE ON PAYMENT U/S 194C OF THE ACT. ACCORDING TO THE LD AO TAX SHOULD HAVE BEEN DEDUCTED U/S 194I OF T HE ACT. THEREFORE, OUT OF TOTAL PAYMENT OF RS. 5519068/ - THE LD AO PROPORTIONATELY DISALLOWED THE SUM OF RS. 4772527/ - U/S 40(A)(IA) OF THE ACT. THIS ISSUE WAS AGITATED BEFORE THE LD CIT(A), WHO HELD THAT TAX IS REQUIRED TO BE DEDUCTED U/S 194I OF THE ACT AND THEREFORE, CONFIRMED THE DISALLOWANCE. 16. THE LD AR SUBMITTED THAT DISALLOWANCE U/S 40(A)(IA) CANNOT BE MADE AS IT IS NOT A CASE OF NON DEDUCTION OF TAX BUT LESSER DEDUCTION OF TAX. HE SUBMITTED THAT IN SUCH CASE THE DISALLOWANCE CANNOT BE MADE. EVEN OTH ERWISE HE SUBMITTED THAT IT IS NOT THE CASE OF THE AO THAT ASSESSEE HAS NOT DEDUCTED TAX AT SOURCE AT ALL. HE FURTHER STATED THAT THERE IS DISPUTE BETWEEN THE ASSESSEE AND THE LD AO UNDER WHICH SECTION THE TAX IS REQUIRED TO BE DEDUCTED. IN THE END HE SUBM ITTED THAT EVEN IF THERE IS RL STEEL AND ENERGY PVT LTD,VS ADDL. CIT, ITA NO. 5784 & 5785/DEL/2012 & 1838/DEL/2013 (ASSESSMENT YEAR: 2007 - 08, 20 08 - 09 AND 2009 - 10) PAGE | 7 DIFFERENCE OF OPINION AND WHEN ASSESSEE HAS DEDUCTED TAX AT SOURCE NO DISALLOWANCE CAN BE MADE. 17. THE LD DR VEHEMENTLY OBJECTED THE ARG U MENT OF THE ASSESSEE AND STATED THAT IF ASSESSEE HAS FAILED TO DEDUCT TAX AT SOURCE ACCORDING TO THE PROVISIONS OF THE ACT THE DISALLOWANCE IS REQUIRED TO BE MADE. 18. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND ALSO PERUSED THE ORDERS OF THE LOWER AUTHORITIES. IN THE PRESENT CASE THE ASSESSEE HA S MADE PAYMENT FOR CRANE HIRE CHARGES U/S 4 0(A)(IA) THE DISALLOWANCE IS MADE, THOUGH THE ASSESSEE HAS MADE DEDUCTION APPLYING THE PROVISIONS OF SECTION 194C OF THE ACT. ACCORDING TO THE LD AO PROVISION OF SECTION 194I S HOULD HAVE BEEN APPLIED. HOWEVER DESPITE THE ABOVE DIFFERENCE OF OPINION ACCO RDING TO US DISALLOWANCE CANNOT BE MADE. HON'BLE KOLKATA HIGH COURT IN CIT VS. SK TEKRIWAL 361 ITR 432 HAS HELD THAT IF THERE IS ANY SHORTFALL DUE TO ANY DIFFEREN CE IN THE OPINION AS TO TAXABILITY OF ANY ITEM OR ANOTHER BY PAYMENT FALLING UNDER VARIOUS TDS PROVISION THE ASSESSEE CAN BE DECLARED TO BE AN ASSESSEE IN DEFAULT U/S 201 OF THE INCOME TAX ACT BUT NO DISALLOWANCE CAN BE MADE U/S 40(A)(IA). IN VIEW THIS WE REVERSE THE FINDING OF THE LOWER AUTHORITIES AND DIRECT THE LD AO TO DELETE THE DISALLOWANCE OF RS. 4772527/ - . IN THE RESULT GROUND NO. 3 OF THE APPEAL IS ALLOWED . 19. IN THE RESULT APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2007 - 08 IS ALLOWED FOR STATISTICAL PURPOSES. 20. COMING TO THE APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2008 - 09, WHEREIN SIMILAR GROUNDS OF APPEAL HAVE BEEN RAISED. 21. THE GROUND NO. 1 OF THE APPEAL IS WITH RESPECT TO THE DEPRECIATION OF RE - HEATING FURNACE AS ENERGY SAVING DEVICE. FOR THE SIMILAR REASONS AS GIVEN IN GROUND NO. 1 OF APPEAL OF THE ASSESSEE FOR AY 2007 - 08 WE SET ASIDE THIS GROUND OF APPEAL WITH SIMILAR DIRECTION GIVEN THEREIN , BACK TO TH E FILE OF THE LD AO. ACCORDINGLY, GROUND NO. 1 OF THE APPEAL IS ALLOWED. 22. GROUND NO. 2 OF THE APPEAL IS WITH RESPECT TO CLAIM OF THE DEPRECATION ON POLLUTION CONTROL EQUIPMENT @100% WHICH IS SIMILAR TO THE GROUND NO. 2 OF THE APPEAL FOR ASSESSMENT YEAR 2007 - 08 WHICH HAS BEEN SET ASIDE RL STEEL AND ENERGY PVT LTD,VS ADDL. CIT, ITA NO. 5784 & 5785/DEL/2012 & 1838/DEL/2013 (ASSESSMENT YEAR: 2007 - 08, 20 08 - 09 AND 2009 - 10) PAGE | 8 TO THE FILE OF THE LD ASSESSING OFFICER. ACCORDINGLY , WE ALSO SET ASIDE THIS GROUND BACK TO THE FILE OF THE LD AO. ACCORDINGLY, GROUND NO. 2 OF THE APPEAL OF THE ASSESSEE IS ALLOWED. 23. GROUND NO. 3 OF THE APPEAL IS WITH RES PECT TO DISALLOWANCE OF CRANE HIRE CHARGES OF RS. 4935410/ - FOR SHORT DEDUCTION OF TAX AT SOURCE. IT IS SIMILAR TO GROUND NO. 3 OF APPEAL OF THE ASSESSEE FOR AY 2007 - 08 WHICH HAS BEEN ALLOWED RELYING ON THE DECISION OF THE HON'BLE KOLKATA HIGH COURT IN CAS E OF CIT VS. SK TEKRIWAL (SUPRA) THEREFORE, FOR THE SAME REASON WE ALLOW GROUND NO. 3 OF THE APPEAL OF THE ASSESSEE. 24. IN THE RESULT APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2008 - 09 IS ALLOWED FOR STATISTICAL PURPOSES. 25. COMING TO THE APPEAL OF THE ASSESSE E FOR ASSESSMENT YEAR 2009 - 10. 26. THE FIRST GROUND OF APPEAL IS WITH RESPECT TO THE DEPRECIATION ON RE - HEATING FURNACE WHICH IS SIMILAR TO GROUND NO. 1 OF THE APPEAL OF THE ASSESSEE FOR AY 2007 - 08. FOR THE SIMILAR REASONS STATED THEREIN WE SET ASIDE THIS ISS UE BACK TO THE FILE OF THE LD AO TO DECIDE THE ISSUE AFRESH AS DIRECTED. IN THE RESULT GROUND NO. 1 OF THE APPEAL OF THE ASSESSEE IS ALLOWED. 27. GROUND NO. 2 OF THE APPEAL OF THE ASSESSEE IS FOR CLAIM OF DEPRECIATION @100% IN RESPECT OF PLANT AND MACHINERY O F POLLUTION CONTROL EQUIPMENT. THE GROUND IS SIMILAR TO GROUND NO. 2 OF THE APPEAL OF THE ASSESSEE FOR AY 2007 - 08 WHICH HAS BEEN SET ASIDE TO THE FILE OF THE LD AO WITH CERTAIN DIRECTION. FOR SIMILAR REASONS AND DIRECTIONS WE SET ASIDE THIS GROUND OF APPEA L BACK TO THE FILE OF THE LD AO. IN THE RESULT THE GROUND NO. 2 OF THE APPEAL OF THE ASSESSEE IS ALLOWED ACCORDINGLY. 28. GROUND NO. 3 OF THE APPEAL IS WITH RESPECT TO DISALLOWANCE OF CRANE HIRE CHARGES PAID BY THE ASSESSEE OF RS. 4604755/ - ON ACCOUNT OF SHOR T DEDUCTION AT SOURCE. THIS ISSUE IS SIMILAR TO GROUND NO. 3 OF THE APPEAL OF THE ASSESSEE FOR AY 2007 - 08, THE ABOVE GROUND OF APPEAL HAS BEEN ALLOWED RELYING ON THE DECISION OF THE HON'BLE KOLKATA HIGH COURT. SIMILAR REASONS WE DELETE THE DISALLOWANCE FOR THIS YEAR TOO. IN THE RESULT GROUND NO. 3 OF THE APPEAL OF THE ASSESSEE IS ALLOWED. RL STEEL AND ENERGY PVT LTD,VS ADDL. CIT, ITA NO. 5784 & 5785/DEL/2012 & 1838/DEL/2013 (ASSESSMENT YEAR: 2007 - 08, 20 08 - 09 AND 2009 - 10) PAGE | 9 29. IN THE RESULT APPEAL OF THE ASSESSEE FOR AY 2009 - 10 IS ALLOWED FOR STATISTICAL PURPOSES. 30. ORDER PRONOUNCED IN THE OPEN COURT ON 0 5 / 0 2 / 2018 . - S D / - - S D / - ( AMIT SHUKLA ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 0 5 / 02 / 2018 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI