The ACIT,Mehsana Circle, Mehsana V. Gujarat Spices & Oil Seeds Co-Operative Union Ltd., Ahmedabad

ITA 588/AHD/2012

• Counselvise Citation: 58820514 RSA 2012
• Duration Of Justice: 3 year(s) 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 14-08-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 07-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DINESH SSINGH
• Assessee Lawyers: VIJAY RANJAN
• Keywords: Depreciation

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI S. S. GODARA, JUDICIAL MEMBER ./ ITA NO. 588 & 589/AHD/2012 / ASSESSMENT YEARS: 2007-08 & 2008-09 ASSISTANT COMMISSIONER OF INCOME TAX, MEHSANA CIRCLE, MEHSANA. VS. GUJARAT SPICES AND OIL SEEDS GROWERS CO-OP. UNION LTD., 4 TH FLOOR, HERITAGE, NR. GRAND BHAGWATI, S.G.HIGHWAY, AHMEDABAD. / (APPELLANT) / (RESPONDENT) REVENUE BY : SHRI DINESH SSINGH, SR.D.R. ASSESSEE(S) BY : SHRI VIJAY RANJAN, A.R. / DATE OF HEARING : 14-8-2015 / DATE OF PRONOUNCEMENT : 20-8-2015 / O R D E R PER G.D. AGRAWAL, VICE PRESIDENT: THESE TWO APPEALS BY THE REVENUE ARE DIRECTED AGAI NST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -I, AHMEDABAD BOTH DATED 26-12-2011 FOR ASSESSMENT YEARS 2007-08 AND 2008-09 RESPECTIVELY. ITA NO.588 & 589/AHD/2012 GUJARAT SPICES & OILSEEDS GROWERS CO-OP UNION LTD. FOR AY 2007-08 & 2008-09. 2 2. THE ONLY GROUND RAISED FOR A.Y. 2007-08 AND GROU ND NO.1 FOR A.Y. 2008-09 IS AGAINST THE DELETION OF THE DISALLO WANCE OUT OF DEPRECIATION CLAIMED BY THE ASSESSEE. THE ASSESSIN G OFFICER DISALLOWED THE PART OF THE DEPRECIATION FOLLOWING H IS OWN ORDER FOR EARLIER YEAR. WE FIND THAT THE IDENTICAL ISSUE IS CONSIDERED BY THE ITAT IN ASSESSEES OWN CASE FOR ASSESSMENT YEARS 2004-05 TO 2006-07 VIDE ORDER ITA NO.586, 587 & 588/AHD/2010 DATED 23-01-20 15. ITAT DELETED THE DISALLOWANCE MADE BY THE ASSESSING OFFI CER IN THESE YEARS WITH THE FOLLOWING FINDING :- IN A.Y. 2005-06 AND 2006-07, ASSESSING OFFICER HA S DISALLOWED THE DEPRECIATION AS BEING UNEXPLAINED FOR A.Y. 2005 -06 AT RS. 79,86,212/-. ASSESSING OFFICER RELIED UPON ASSESSME NT ORDER FOR A.Y. 2004-05 INTER ALIA STATED THAT IN A.Y. 2004-05, TRA NSACTION MADE WITH DHRUV STEEL WAS BOGUS, CONSEQUENTLY THE DEPRECIATIO N CLAIMED TO BE DISALLOWED. WE HAVE UPHELD THE ORDER OF CIT(A) ON TH E ISSUE OF GENUINENESS OF STEEL TRANSACTION WHEREBY HE HAS HEL D THE PURCHASE OF M.S. STEEL FROM M/S. DHRUV STEEL AS GENUINE FOR A. Y.2004-05. ACCORDINGLY, DISALLOWANCE MADE BY ASSESSING OFFICER IN SUBSEQUENT ORDER ON POINT OF DEPRECIATION WAS NOT JUSTIFIED HE LD BY CIT (A). IN VIEW OF THIS, ADDITION MADE IN BOTH YEARS OF DISALL OWING CLAIM OF DEPRECIATION OF BUILDING AND PLANT AND MACHINERY WA S RIGHTLY HELD TO BE UNWARRANTED BY CIT (A) AND SAME WAS RIGHTLY DELETED BY HIM. THIS REASONED FINDING OF CIT (A) NEEDS NO INTERFERENCE FR OM OUR SIDE. WE UPHOLD THE ORDER OF CIT (A) ON THE ISSUE OF DEPRECIA TION FOR A.Y. 2005- 06 AND 2006-07. 3. ADMITTEDLY THE FACTS FOR THE YEAR UNDER CONSIDER ATION ARE IDENTICAL. ASSESSING OFFICER DISALLOWED THE DEPRECI ATION ON THE GROUND THAT IN A.Y. 2004-05 CERTAIN TRANSACTIONS MADE WITH DHRUV STEEL WAS HELD TO BE BOGUS BY THE ASSESSING OFFICER. ITAT HEL D THE PURCHASE OF STEEL FROM M/S. DHRUV STEEL AS GENUINE FOR A.Y. 200 4-05 AND ITA NO.588 & 589/AHD/2012 GUJARAT SPICES & OILSEEDS GROWERS CO-OP UNION LTD. FOR AY 2007-08 & 2008-09. 3 CONSEQUENTLY THE DISALLOWANCE OF DEPRECIATION MADE BY THE ASSESSING OFFICER WAS DELETED. 4. WE THEREFORE, RESPECTFULLY FOLLOWING THE ABOVE D ECISION OF ITAT IN ASSESSEES OWN CASE UPHOLD THE ORDER OF THE CIT (A) AND REJECT THE REVENUES GROUND OF APPEAL. 5. GROUND NO.2 IN REVENUES APPEAL FOR A.Y. 2008-0 9 READS AS UNDER:- THE LD. CIT (APPEALS) HAS ERRED IN LAW AND ON FACTS IN DELETING DISALLOWANCE OF RS.3,59,781/- OUT OF ADDITIONAL DEP RECIATION CLAIMED BY THE ASSESSEE; 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL PLACED BEFORE US. AT THE TIME OF HEARING BEFORE US IT WAS CONTENDED BY THE LD. COUNSEL THAT THE HONBLE ALLAHABAD HIGH COURT IN TH E CASE OF CIT V/S. SHIV OIL & DAL MILL [2006] 281 ITR -221 HAS CONSI DERED THE IDENTICAL ISSUE AND HELD THAT THE REFINING OF OIL PURCHASED F ROM LOCAL MARKET AMOUNTS TO PRODUCTION. WE FIND THAT THE HONBLE A LLAHABAD HIGH COURT IN THE ABOVE MENTIONED CASE HELD THAT THE TR IBUNAL HAD FOUND THAT AFTER PURCHASING THE OIL, IT WAS SUBJECTED TO A PROCESS OR TREATMENT AND WHAT WAS SOLD BY THE ASSESSEE WAS NOT THE SAME THING AS WAS ORIGINALLY PURCHASED. THE TRIBUNAL WAS RIGHT IN AL LOWING THE BENEFIT OF SECTION 80HH AND 80I OF THE ACT TO THE ASSESSEE IN RESPECT OF REFINING OF THE OIL FROM THE OIL PURCHASED FROM THE LOCAL MA RKET INASMUCH AS THE PROCESS OF REFINING AMOUNTS TO PRODUCTION AS CONTEM PLATED UNDER THE SECTIONS. ITA NO.588 & 589/AHD/2012 GUJARAT SPICES & OILSEEDS GROWERS CO-OP UNION LTD. FOR AY 2007-08 & 2008-09. 4 7. NO CONTRARY DECISION IS BROUGHT TO OUR KNOWLEDGE . WE THEREFORE, RESPECTFULLY FOLLOWING THE ABOVE DECISION OF HONBL E ALLAHABAD HIGH COURT UPHOLD THE ORDER OF THE CIT (A) AND REJECT TH E GROUND NO.2 OF THE REVENUES APPEAL. 8. IN THE RESULT BOTH THE APPEALS OF THE REVENUE AR E DISMISSED. ORDER PRONOUNCED IN THE COURT ON 20TH AUGUST, 2015 AT AHMEDABAD. - SD/- SD/- (S. S. GODARA) JUDICIAL MEMBER (G.D. AGRAWAL) VICE-PRESIDENT AHMEDABAD; DATED 20 /08/2015 PATKI !'#'$ / COPY OF THE ORDER FORWARDED TO 1. / THE APPELLANT 2. / THE RESPONDENT. 3. !' # / CONCERNED CIT 4. # ( ) / THE CIT(A) 5. &'( ' , ' , ! / DR, ITAT, AHMEDABAD 6. (-. / GUARD FILE . / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD