DCIT, Bangalore V. M/s Hewlett - Packard India Sales P. Ltd., Bangalore

ITA 589/BANG/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 57482 (ITAT-BANGALORE)
• Duration Of Justice: 9 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 19-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: FARAHAT HUSSAIN QURESHI CITII

Judgement Text

PAGE 1 OF 3 ITA NO.58 9/BANG/2011 1 INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCHES B BEFORE SHRI N K SAINI, ACCOUNANT MEMBER AND SHRI GEORGE GEORGE K, JUDICIAL MEMBER ITA NO.589/BANG/2011 (ASST. YEAR 2008-0 9) THE DEPUTY COMMISSIONER OF INCOME TAX, LTU, BANGALORE. VS M/S HEWLETT PACKARD INDIA SALES PVT. LTD., NO.24, SALARPURIA ARENA, HOSUR MAIN ROAD, ADUGODI, BANGALORE-30. PA NO.AAACC9862F (APPELLANT) (RESPONDENT) DATE OF HEARING : 27.02.2012 DATE OF PRONOUNCEMENT : 27.02.2012 APPELLANT BY : SHRI FARAHAT HUSSAIN QURESHI, CIT-II RESPONDENT BY : SHRI SHARATH RAO, C.A. O R D E R PER GEORGE GEORGE K : THIS IS AN APPEAL FILED BY THE REVENUE. THE RELE VANT ASSESSMENT YEAR IS 2008-09. THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (LTU), BANGALORE DATED 2 3.03.2011. THE APPEAL ARISES OUT OF THE ASSESSMENT COMPLETED U/S 115WE(3) OF THE INCOME-TAX ACT, 1961. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- I) THE ORDER OF THE CIT(A) IN SO FAR AS IT IS PREJ UDICIAL TO THE REVENUE IS OPPOSED TO LAW AND FACTS OF THE CASE . PAGE 2 OF 3 ITA NO.58 9/BANG/2011 2 II) THE LEARNED CIT(A) ERRED IN HOLDING THAT THE RE NT PAID FOR THE CAR PARKING AREA CANNOT BE TREATED AS SOMET HING DISTINCT AND DIFFERENT FROM THE PROPERTY RENTED BY TH E ASSESSEE FOR HOUSING ITS BUSINESS ACTIVITIES. III) THE LEARNED CIT(A) HAS ERRED IN RELYING ON THE DECIS ION OF THE ITAT IN THE ASSESSEES OWN CASE FOR ASSESSME NT YEAR 2006-07. IV) THE LEARNED CIT(A) HOWEVER HAS NOT APPRECIATED THAT ALL THE JUDGEMENTS RELIED UPON BY THE ITAT IN ENTIRELY DIFFERENT CONTEXT. V) THE LEARNED CIT(A) SHOULD HAVE APPRECIATED THAT WHENEVER A NEW LAW IS INTRODUCED, THE CIRCULARS ISS UED BY THE BOARD EXPLAINING THE MEANING AND SCOPE OF THE S AME, IT IS THE LEGISLATIVE INTENT THAT IS BEING CLARIFIE D IN SUCH CIRCULARS. HENCE, THE LEARNED CIT(A) SHOULD HAVE L OOKED INTO THE CASE FROM THIS PERSPECTIVE. VI) FURTHER, THE CIT(A) SHOULD APPRECIATE THE FACT THAT THESE CIRCULARS ISSUED BY THE BOARD ARE BINDING ON T HE ASSESSING OFFICERS. VII) FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE URGED A T THE TIME OF HEARING, IT IS HUMBLY PRAYED THAT THE ORD ER OF THE CIT(A) BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E COMPANY HAD FILED A RETURN OF FRINGE BENEFITS U/S 115WE(1) OF THE ACT. DURING THE ASSESSMENT PROCEEDINGS U/S 115WE(2) OF THE ACT, THE AO HELD TH AT THE RENT PAID FOR CAR PARKING AREA IS ALSO LIABLE TO FRINGE BENEFIT T AX BY RELYING UPON THE CBDT CIRCULAR NO.8 OF 2005 DATED 29.08.2005. 4. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE T HE CIT(A) WHO ALLOWED THE SAME BY FOLLOWING THE ORDER OF THE TRIB UNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2006-07 (ITA NO.43/BANG /2010 DATED 16/8/2010). THE TRIBUNAL HELD THAT CAR PARKING EXP ENSES ARE IN THE NATURE PAGE 3 OF 3 ITA NO.58 9/BANG/2011 3 OF RUNNING EXPENSES AND IT IS NOT POSSIBLE TO TREAT PARKING SLOT EXPENSES AS ANALOGOUS TO REPAIRS AND MAINTENANCE. IT WAS CONCL UDED BY THE TRIBUNAL THAT RENT PAID FOR THE CAR PARKING AREA DOES NOT FALL UN DER THE CATEGORY OF EXPENSES AS DISCUSSED IN THE CIRCULAR ISSUED BY THE CBDT (CIRCULAR NO.8 OF 2005 DATED 29/8/2005). AGGRIEVED BY THIS ORDER, REVE NUE IS IN APPEAL BEFORE US. 5. ON HEARING BOTH THE PARTIES AND AFTER CONSIDERIN G THE RELEVANT MATERIALS ON RECORD, WE FIND THAT THE ISSUE IS COVE RED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE TRIBUNAL IN THE ASSESSE ES OWN CASE FOR THE EARLIER YEARS. THE LEARNED CIT(A) HAS ONLY FOLLOWED THE SAID ORDER IN ALLOWING THE ASSESSEES APPEAL. THE TRIBUNAL HAD C ONSIDERED THE CBDT CIRCULAR REFERRED TO IN THE GROUNDS OF APPEAL AND A FTER CONSIDERING THE JUDGEMENTS OF THE APEX COURT AND THE HIGH COURTS H AD DECIDED THE MATTER IN FAVOUR OF THE ASSESSEE. SINCE THE IMPUGNED ORDER OF THE CIT(A) IS IN CONSONANCE WITH THE DECISION OF THE TRIBUNAL, WE D O NOT SEE ANY REASON TO INTERFERE WITH THE SAME. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH DAY OF FEBRUARY, 2012 SD/- SD/- (N K SAINI) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER COPY TO:- 1. THE REVENUE 2. THE ASSESSEE 3. T HE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR 6. GF MSP/- BY ORDER ASST. REGISTRAR, ITAT, BANGALORE.