M/S U.P.STATE BRIDGE CORPORATION LTD., Lucknow V. DCIT, RANGE-6, Lucknow

ITA 600/LKW/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 1950 (ITAT-LUCKNOW)
• Duration Of Justice: 4 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 23-10-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S K MADHUK
• Assessee Lawyers: B P YADAV COST ACCOUNTANT
• Keywords: Depreciation; Opportunity of being heard; Rule of consistency; Application of stay; Question of law; Difference of opinion; Assessment record; Capital receipt; Change of opinion; Reassessment proceedings; Set aside
• Section: 143(3); 191; 207; 13; 32; 148; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCHA, LUCKNOW BEFORE SHRI. A. D. JAIN, VICE PRESIDENT AND SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER ITA NO S . 600 & 601/LKW/2019 ASSESSMENT YEAR S : 2009 - 10 & 2010 - 11 M/S U.P. STATE BRIDGE CORPORATION LTD. SETU BHAWAN 16, MADAN MOHAN MALVIYA MARG LUCKNOW V. DCIT RANGE 6 LUCKNOW TAN/PAN: AAACU3258K (APPELLANT) (RESPONDENT) M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 ARISING OUT OF ITA NOS.600 & 601/LKW/2019 ASSESSMENT YEAR S : 2009 - 10 & 2010 - 11 DCIT RANGE 6 LUCKNOW V. M/S U.P. STATE BRIDGE CORPORATION LTD. SETU BHAWAN 16, MADAN MOHAN MALVIYA MARG LUCKNOW TAN/PAN: AAACU3258K (APP LIC ANT) (RESPONDENT) ASSESSEE BY: SHRI B.P. YADAV, COST ACCOUNTANT RESPONDENT BY: SHRI S. K. MADHUK, CIT (DR ) DATE OF HEARING: 17 02 2020 DATE OF PRONOUNCEMENT: 20 03 2020 O R D E R PER T.S.KAPOOR, A.M: THESE ARE TWO APPEALS FILED BY THE ASSESSEE AGAINST SEPARATE ORDERS OF THE LD. CIT(A), BOTH DATED 15/10/2019. THE DEMANDS IN THESE CASES ARISING OUT OF ASSESSMENT ORDERS WERE STAYED BY THE TRIBUNAL IN STAY APPLICATIONS NO.39 & 40/LKW/2019, VIDE CONSOLIDATED TRIBUNAL ORDER DATED 25/10/2019. THE REVENUE HAS FILED APPLICATION FOR VACATION OF ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 2 OF 16 SUCH STAY ORDERS. THESE MISCELLANEOUS FILED BY THE REVENUE BEING RELATED TO THE CASES UNDER CONSIDERATION FOR VACATION OF STAY OF DEMAND, ARE ALSO BEING DISPOSED OF THROUGH THIS ORDER. SIMILAR ISSUES ARE INVOLVED IN THESE APPEALS AND THESE WERE HEARD TOGETHER AND THEREFORE, FOR THE SAKE OF CONVENIENCE, A COMMON AND CONSOLIDATED ORDER IS BEING PASSED. GROUNDS OF APPEAL IN ITA NO.600/LKW/2019 ARE REPRODUCED BELOW: 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-II, LUCKNOW (HEREINAFTER REFERRED TO AS THE LD. CIT-A) ERRED ON FACTS AND IN LAW IN HOLDING THAT THE 'A.O. HAS READJUDICATED THE ISSUE BY FOLLOWING THE DIRECTIONS OF HON'BLE ITAT' WITHOUT APPRECIATING THE FACT THE PRESENT ASSESSMENT ORDER HAS BEEN PASSED IN GROSS VIOLATION OF THE DIRECTIONS OF THE HON'BLE ITAT AND HENCE THE ORDER SO PASSED DESERVES TO BE QUASHED. 2. THE LD. CIT-A ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS.24,59,61,124/-MADE BY THE LD. A.O. WITHOUT APPRECIATING THE FACTS THAT THE SHUTTERING ARE CHARGED TO WORKS AS CONSUMABLE STORES AND NO DEPRECIATION WAS CLAIMED ON SHUTTERING AND ALSO BY NOT APPRECIATING THAT IN CORPORATION'S OWN CASE, SHUTTERING DEBITED TO THE PROFIT AND LOSS ACCOUNT HAVE BEEN HELD AS CONSUMABLE STORES BY THE HON'BLE ALLAHABAD HIGH COURT. 3. THE LD. CIT-A ERRED ON FACTS AND IN LAW IN NOT DECIDING THE FACTUAL ISSUES THAT THE APPELLANT HAS NOT CLAIMED 100% DEPRECIATION ON SHUTTERING AS ALLEGED BY THE LD. ASSESSING OFFICER. WITHOUT PREJUDICE TO ABOVE: 4. IN CASE GROUNDS NO 2 & 3 DO NOT FIND FAVOUR OF THE HON'BLE BENCH, THEN NECESSARY DIRECTION BE GIVEN TO THE LD. A.O. TO GIVE EFFECT OF DEPRECIATION IN THE COMPUTATION OF INCOME OF THE SUBSEQUENT YEARS ON THE AMOUNT OF SHUTTERING. ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 3 OF 16 5. THE LD. CIT-A ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THE FACT THAT THE LD. A.O. HAS WRONGLY PASSED THE ASSESSMENT ORDER AT TOTAL INCOME OF RS.52,65,07,024/- WHEREAS ADDITION MADE BY HIM IS ONLY RS.24,59,61,124/-. 6. THE LD. CIT-A ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THE FACT THAT THE APPELLANT UNDERTAKES THE GOVERNMENT WORKS ONLY ON THE BASIS OF CENTAGE AND THE CENTAGE EARNED STOOD ALREADY OFFERED TO TAX AND ALL THE EXPENSES CHARGED TO WORKS ARE REIMBURSEMENT IN NATURE. 7. THE LD. CIT-A ERRED ON FACTS AND IN LAW IN NOT PROVIDING THE APPELLANT REASONABLE AND SUFFICIENT OPPORTUNITY TO HAVE ITS SAY AND TO MAKE COMPLIANCES OF THE REASONS BEING RELIED UPON BY THE LD. A.O.IN MAKING ADDITION IN THE HANDS OF THE APPELLANT. 2. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS IS SECOND ROUND OF APPEAL BEFORE THIS TRIBUNAL AND IN THE FIRST ROUND, THE TRIBUNAL HAD REMITTED THE ISSUE TO THE ASSESSING OFFICER AND IN THIS RESPECT, OUR ATTENTION WAS INVITED TO THE ORDER OF THE TRIBUNAL DATED 12/2/2018. EXPLAINING THE FACTS OF THE CASE, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS A GOVERNMENT ORGANIZATION, ENGAGED IN THE CONSTRUCTION OF BRIDGES AND FOR CONSTRUCTION OF BRIDGES, THE ASSESSEE USED SHUTTERING AND SCAFFOLDING, WHICH, AS PER THE REGULAR PRACTICE, HAVE BEEN TREATED AS CONSUMABLE STORES AND THE ASSESSEE HAS BEEN CHARGING THE VALUE OF CONSUMABLE STORES CONSUMED TO ITS PROFIT AND LOSS ACCOUNT. IT WAS SUBMITTED THAT THIS PRACTICE IS BEING FOLLOWED BY THE ASSESSEE SINCE BEGINNING AND WAS EVEN CONFIRMED BY THE HON'BLE HIGH COURT AND OUR ATTENTION WAS INVITED TO THE JUDGMENT OF THE HON'BLE ALLAHABAD HIGH COURT IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEAR 1995- 96, WHEREIN, SIMILAR ISSUE CAME UP FOR CONSIDERATION AND THE HON'BLE HIGH COURT DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY DISMISSING THE APPEAL OF THE REVENUE. ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 4 OF 16 3. IT WAS SUBMITTED THAT IN THE YEARS UNDER CONSIDERATION, THE ITAT, VIDE ITS ORDER DATED 30/4/2015, HAD DISMISSED THE DEPARTMENTAL APPEAL ON THE BASIS OF ITAT DECISION IN THE CASE OF THE ASSESSEE FOR ASSESSMENT YEAR 1995-96. HOWEVER, THE DEPARTMENT FILED AN APPEAL BEFORE THE HON'BLE JURISDICTIONAL HIGH COURT AND THE HIGH COURT REMITTED THE ISSUE TO THE TRIBUNAL, VIDE ORDER DATED 12/1/2017. IT WAS FURTHER SUBMITTED THAT IN VIEW OF THE DIRECTIONS OF THE HON'BLE HIGH COURT, THE TRIBUNAL AGAIN HEARD THE APPEALS AND REMITTED THE ISSUE BACK TO THE ASSESSING OFFICER WITH THE DIRECTIONS TO DECIDE THE ISSUE OF CLAIM OF SHUTTERING, KEEPING IN VIEW THE TREATMENT GIVEN TO THE ASSESSEE IN EARLIER YEARS. HOWEVER, THE ASSESSING OFFICER, INSTEAD OF FOLLOWING THE DIRECTIONS OF THE ITAT, AGAIN DISALLOWED THE CLAIM OF THE ASSESSEE ON ACCOUNT OF SHUTTERING WITHOUT EXAMINING THE RECORDS OF THE ASSESSEE IN EARLIER YEARS. IT WAS SUBMITTED THAT THE ACTION OF THE ASSESSING OFFICER IN NOT FOLLOWING THE DIRECTIONS OF THE ITAT IS ILLEGAL AND, THEREFORE, THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER NEEDS TO BE QUASHED AND IN THIS RESPECT, RELIANCE WAS PLACED ON, INTER ALIA, THE FOLLOWING CASE LAWS: 1. CIT VS. HOPE TEXTILES LTD., 225 ITR 993 (MP). 2. CIT VS. RAZA TEXTILES LTD., 207 (10) MTC 803 (ALLD) 3. CIT VS. KAMLA TOWN TRUST, 198 ITR 191 (ALLD) 4. BHOPAL SUGAR INDUSTRIES LTD. VS. ITO, 40 ITR 618(SC) 4. IT WAS SUBMITTED THAT IN ALL THESE DECISIONS, THE HON'BLE APEX COURT AS WELL AS THE HON'BLE HIGH COURTS HAVE HELD THAT THE ASSESSING OFFICER IS BOUND TO FOLLOW THE DIRECTIONS OF A SUPERIOR COURT AND IS ALSO BOUND TO PASS ASSESSMENT ORDER IN ACCORDANCE WITH THE DIRECTIONS GIVEN BY THE SUPERIOR COURT. THE LD. COUNSEL ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 5 OF 16 FOR THE ASSESSEE TOOK US TO THE ORDER DATED 12/2/2018 OF THE TRIBUNAL TO DEMONSTRATE AS TO WHAT WERE THE DIRECTIONS OF THE TRIBUNAL AND OUR SPECIFIC ATTENTION WAS INVITED TO PARA 4.1, WHEREIN, THE TRIBUNAL HAD DIRECTED THE ASSESSING OFFICER TO READJUDICATE THE ISSUE AFTER TAKING INTO ACCOUNT THE ASSESSMENTS OF THE ASSESSEE FOR THE EARLIER YEARS. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT INSTEAD OF REFERRING TO THE PAST ASSESSMENT RECORDS OF THE ASSESSEE, THE ASSESSING OFFICER AGAIN MADE THE SAME ADDITION AND IN THIS REGARD A SPECIFIC GROUND WAS TAKEN BEFORE THE LD. CIT(A), HOWEVER, HE DISMISSED THE SAME. IT WAS SUBMITTED THAT IN VIEW OF THESE FACTS AND CIRCUMSTANCES, THE ORDER PASSED BY THE ASSESSING OFFICER AND SUSTAINED BY THE LD. CIT(A), IN VIOLATION OF THE DIRECTIONS OF THE TRIBUNAL, SHOULD BE DECLARED AS NULL AND VOID. 5. WITHOUT PREJUDICE TO THE ABOVE ARGUMENTS FOR DECLARATION OF ASSESSMENT ORDER AS NULL AND VOID, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT SINCE INCEPTION, SHUTTERING, CENTERING, SCAFFOLDING, ETC., ARE BEING USED AS CONSUMABLES BY THE ASSESSEE AND THIS FACT TOO WAS WELL ACCEPTED BY THE REVENUE IN ALL THE SCRUTINY ASSESSMENTS COMPLETED UNDER SECTION 143(3) OF THE ACT. IN THIS RESPECT, OUR ATTENTION WAS INVITED TO THE ASSESSMENT ORDERS PASSED BY THE ASSESSING OFFICER FOR ASSESSMENT YEARS 2004-05 TO 2008-09, PLACED IN THE PAPER BOOK AT PAGES 70 TO 79. IT WAS SUBMITTED THAT PRIOR TO THESE YEARS, FOR THE FIRST TIME, IN ASSESSMENT YEAR 1988-89, THE ADDITION WAS MADE BY THE REVENUE ON THE GROUND THAT THE ASSESSEE WAS CHARGING 100% DEPRECIATION ON CLOSING BALANCE OF SHUTTERING. HOWEVER, THE ADDITION SO MADE WAS DELETED BY THE TRIBUNAL. IT WAS FURTHER SUBMITTED THAT AGAIN IN ASSESSMENT YEAR 1995-96, THE ADDITION WAS MADE, WHICH WAS DELETED BY THE ITAT AND THE ORDER OF THE ITAT WAS CONFIRMED BY THE HON'BLE HIGH COURT IN TOTO. FROM ASSESSMENT YEARS 1996-97 ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 6 OF 16 TO 2005-06, SCRUTINY ASSESSMENTS HAVE BEEN COMPLETED BY THE REVENUE UNDER SECTION 143(3) OF THE ACT AND NO DISALLOWANCE WAS MADE ON ACCOUNT OF SHUTTERING, MEANING THEREBY, THAT THE REVENUE HAS ACCEPTED THE FACT THAT SHUTTERING IS CONSUMABLE STORES. IT WAS FURTHER SUBMITTED THAT FROM ASSESSMENT YEARS 2006-07 TO 2008-09, SCRUTINY ASSESSMENTS WERE AGAIN COMPLETED UNDER SECTION 143(3) OF THE ACT AND THE REVENUE DID NOT DRAW ANY ADVERSE INFERENCE REGARDING USE OF SHUTTERING. THEREFORE, KEEPING IN VIEW THE RULE OF CONSISTENCY, THE ACTION OF THE LD. CIT(A) IN SUSTAINING THE ADDITION IS NOT JUSTIFIED AND RELIANCE IN THIS RESPECT WAS PLACED ON THE FOLLOWING JUDGEMENTS FOR THE PROPOSITION THAT WHERE THE FACTS AND CIRCUMSTANCES REMAIN THE SAME, THE REVENUE AUTHORITIES ARE BOUND TO FOLLOW THE RULE OF CONSISTENCY: 1. PR. CIT VS. M/S QUEST INVESTMENT ADVISORS PVT. LTD. [2018-(ITI)-GJX-284-BOM] 2. DCIT VS. T.M. INTERNATIONAL LOGISTIC LTD. [2016-(ITI)-GJX- 3035-TCAL] 3. CIT VS. KOHINOOR FOOD LIMITED [2019-(ITI)-GJX-0107- DEL] 6. THE LD. COUNSEL FOR THE ASSESSEE ARGUED THAT THE RELIANCE PLACED BY THE REVENUE AUTHORITIES ON THE JUDGMENT IN THE CASE OF HARIJAN EVAM NIRBAL VARG AVAS NIGAM LTD. VS. CIT, 131 CTR 178 (ALLD), IS MISPLACED, AS IN THAT CASE, THE ASSESSEE WAS USING SAME SHUTTERING MATERIAL AND THEREFORE, THE COURT HAD RIGHTLY HELD THEM TO BE A PLANT, WHEREAS IN THE CASE OF THE PRESENT ASSESSEE, IT NEEDS DIFFERENT TYPES AND SIZES OF SCAFFOLDING OF BRIDGE AND THEREFORE, A PART OF SHUTTERING/SCAFFOLDING ALWAYS BECOMES UNUSABLE AND THAT IS WHY ON THE BASIS OF TECHNICAL EVALUATION, ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 7 OF 16 THE SAME WERE BEING CHARGED TO PROFIT AND LOSS ACCOUNT, AS CONSUMABLE STORES. 7. THE LD. D.R., ON THE OTHER HAND, ARGUED THAT THE TRIBUNAL, IN ITS ORDER, HAD DIRECTED THE ASSESSING OFFICER TO RE- ADJUDICATE THE ISSUE, RATHER THAN TO VERIFY THE FACTS FROM THE CASE RECORDS. IT WAS SUBMITTED THAT THE ITAT HAD DIRECTED THE ASSESSING OFFICER TO READJUDICATE THE ISSUE OF CLAIM OF THE ASSESSEE REGARDING SHUTTERING, CENTERING AND SCAFFOLDING AFTER TAKING INTO ACCOUNT THE ASSESSMENTS OF THE ASSESSEE FOR EARLIER YEARS AND ALSO CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. THE LD. D.R. HAS SUBMITTED THAT ALL THESE ASPECTS WERE ADDRESSED BY THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER AND OUR ATTENTION WAS INVITED TO PARA 5.2 ONWARDS OF THE ORDER OF THE ASSESSING OFFICER DATED 28/2/2018. IT WAS SUBMITTED THAT THE ASSESSING OFFICER, AFTER GOING THROUGH THE ASSESSMENT ORDERS FROM ASSESSMENT YEAR 2004-05 TO 2008-09, HAS CONCLUDED THAT THE ASSESSING OFFICER HAD NOT MADE ANY DISALLOWANCE UNDER THE HEAD SHUTTERING AND HAD ALSO NOT COMMENTED ON THIS ISSUE AT ALL AND, THEREFORE, THE CLAIM OF THE ASSESSEE THAT SINCE THE DEPARTMENT HAD ACCEPTED THE METHOD IN EARLIER ASSESSMENT YEARS, IS DEVOID OF MERITS. THE LD. D.R. ALSO INVITED OUR ATTENTION TO THE ORDER OF THE LD. CIT(A), WHEREIN, THE LD. CIT(A), REFERRING TO PAGES 3 TO 5.4 OF THE ASSESSMENT ORDER, HAS UPHELD THE ACTION OF THE ASSESSING OFFICER BY HOLDING THAT THE ASSESSING OFFICER HAS EXAMINED THE ISSUE RELATING TO ITS CLAIM IN THE EARLIER YEARS. THE LD. D.R. SUBMITTED THAT THEREFORE, IN VIEW OF THESE FACTS AND ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 8 OF 16 CIRCUMSTANCES, THE GROUND TAKEN BY THE ASSESSEE, FOR DECLARING THE ASSESSMENT ORDER AS NULL AND VOID, NEEDS TO BE DISMISSED. 8. AS REGARDS THE MERITS OF THE CASES, THE LD. D.R. SUBMITTED THAT THE HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF HARIJAN EVAM NIRBAL VARG AVAS NIGAM LTD. VS. CIT (SUPRA), HAD DECIDED THE ISSUE IN FAVOUR OF THE REVENUE BY HOLDING THAT SHUTTERING IS A PLANT AND IS NOT CONSUMABLE STORES. THE HON'BLE ANDHRA HIGH COURT, IN THE CASE OF CIT VS. VIJAYA ENTERPRISES, REPORTED IN 332 ITR 235, HAS ALSO HELD THAT SHUTTERING, CENTERING AND SCAFFOLDING EXPENSES ARE PLANT AND MACHINERY AND NOT CONSUMABLE STORES. THE LD. D.R. FURTHER PLACED RELIANCE ON THE JUDGMENT OF THE HON'BLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. MOHTA CONSTRUCTION CO., 190 CTR 131, WHEREIN, THE HON'BLE HIGH COURT HAS AGAIN HELD THE SHUTTERING TO BE PLANT. IT WAS CONTENDED THAT THEREFORE, KEEPING IN VIEW THE VARIOUS JUDGMENTS OF THE VARIOUS HIGH COURTS, THE AUTHORITIES BELOW HAVE RIGHTLY MADE AND SUSTAINED THE ADDITION. 9. IN REJOINDER, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT AN ORDER OF ASSESSMENT CAN BE PASSED EITHER IN TERMS OF SUB- SECTION (1) OF 143, OR SUB-SECTION (3) OF 143 OF THE ACT. IT WAS SUBMITTED THAT WHEN A REGULAR ORDER OF ASSESSMENT IS PASSED IN TERMS OF SECTION 143(3) OF THE ACT, A PRESUMPTION CAN BE RAISED THAT SUCH AN ORDER HAS BEEN PASSED ON APPLICATION OF MIND. IT WAS ARGUED THAT IT IS WELL KNOWN THAT A PRESUMPTION CAN ALSO BE RAISED TO THE EFFECT THAT IN TERMS OF CLAUSE (E) OF SECTION 114 OF THE EVIDENCE ACT, 1872, THE JUDICIAL AND OFFICIAL ACTS HAVE BEEN REGULARLY PERFORMED. REFERRING TO THE JUDGMENT OF THE HON'BLE APEX COURT IN THE CASE OF CALCUTTA DISCOUNT CO. LTD. VS. ITO, 41 ITR 191, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT IT IS THE ASSESSEES DUTY TO DISCLOSE PRIMARY FACTS, INCLUDING PARTICULAR ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 9 OF 16 ENTRIES IN THE ACCOUNT BOOKS AND ONCE ALL PRIMARY FACTS ARE BEFORE THE ASSESSING AUTHORITY, THE ASSESSING OFFICER REQUIRES NO FURTHER ASSISTANCE AND IT IS FOR THE ASSESSING OFFICER TO DECIDE WHAT INFERENCES OF FACT CAN BE REASONABLY DRAWN. IT WAS SUBMITTED THAT ONCE THE ASSESSMENT OF THE ASSESSEE IS COMPLETED UNDER SECTION 143(3) OF THE ACT AND ALL ENQUIRIES/DOCUMENTS, AS REQUIRED BY THE ASSESSING OFFICER DURING THE ASSESSMENT ORDER, ARE REPLIED TO/PROVIDED, IT CAN SAFELY BE PRESUMED THAT THE ASSESSING OFFICER HAS PASSED THE ASSESSMENT ORDER AFTER GOING THROUGH ALL THE FACTS OF THE CASE, AND ALL THE MATERIAL BEFORE HIM, IRRESPECTIVE OF THE MANNER IN WHICH THE ASSESSMENT ORDER IS WORDED. IT WAS SUBMITTED THAT UNDER SECTION 143(3) OF THE ACT, IF THE ASSESSING OFFICER DID NOT MAKE ANY ADDITION ON A PARTICULAR ISSUE, IT CAN BE PRESUMED THAT HE HAS AGREED WITH THE VERSION OF THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN THE PRESENT CASES, IN EARLIER YEARS, IRREFUTABLY, THE ASSESSING OFFICER DID NOT MAKE ANY ADDITION ON ACCOUNT OF SCAFFOLDING/SHUTTERING AFTER DUE APPLICATION OF MIND AND WHEREVER THE ADDITION WAS MADE, IT WAS DELETED BY THE TRIBUNAL AND SUCH DELETION WAS CONFIRMED BY THE HON'BLE HIGH COURT AND, THEREFORE, THE ASSESSING OFFICER WAS REQUIRED TO PASS THE PRESENT ASSESSMENT ORDER BY TAKING INTO CONSIDERATION THE EARLIER SCRUTINY ASSESSMENT ORDERS PASSED UNDER SIMILAR FACTS AND CIRCUMSTANCES, FOLLOWING THE RULE OF CONSISTENCY. IT WAS FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS WRONGLY RELIED ON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF ITO VS. M/S TECH SPAN INDIA PVT. LTD. (SUPRA) FOR HOLDING THAT IN CASE THE ASSESSING OFFICER DOES NOT COMMENT ON A PARTICULAR ITEM, THEN IT CANNOT BE DEEMED TO BE PRECEDENT. IT WAS SUBMITTED THAT THE CASE LAW OF THE HON'BLE APEX COURT, REFERRED TO ABOVE, WAS ON ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 10 OF 16 A DIFFERENT FOOTING, I.E., SECTION 148 AND THEREFORE, IS NOT APPLICABLE. 10. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE THROUGH THE MATERIAL ON RECORD. WE FIND THAT EARLIER THESE APPEALS WERE DISPOSED OF BY THE TRIBUNAL, VIDE ORDER DATED 12/2/2018, WHEREIN, THE SAID APPEALS WERE REMITTED TO THE ASSESSING OFFICER FOR RE-ADJUDICATION, BY HOLDING AS UNDER: 4.1 FROM ABOVE ORDER OF THE TRIBUNAL, WE FIND THAT ASSESSEE HAS BEEN ALLOWED SUCH CLAIM FROM ASSESSMENT YEAR 95-96 AND ONWARDS AND FOR THE ASSESSMENT YEAR 2004- 05 TO 2008-09 THE ASSESSMENTS WERE COMPLETED U/S 143(3) AND ASSESSING OFFICER HAD NOT MADE ANY DISALLOWANCE. WE ALSO FIND THAT THE ASSESSEE HAS BEEN CLAIMING THE DEDUCTION AS CONSUMABLE STORES AND NOT AS DEPRECIATION ON PLANT & MACHINERY. THE HON'BLE COURT HAS HOWEVER, NOTED THAT ASSESSEE HAS BEEN CHARGING DEPRECIATION AT A PARTICULAR RATE ON PLANT & MACHINERY WHICH HAS BEEN AMENDED THEREFORE, WE FEEL IT APPROPRIATE THAT THIS ISSUE SHOULD BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER WHO SHOULD READJUDICATE THE ISSUE AFTER TAKING INTO ACCOUNT THE ASSESSMENTS OF THE ASSESSEE FOR THE EARLIER YEARS. AND ALSO FACTS AND CIRCUMSTANCES OF THE CASE. HE SHOULD ALSO TAKE INTO ACCOUNT AS TO WHETHER THE ASSESSEE WAS CLAIMING DEPRECIATION @100% ON PLANT & MACHINERY. NEEDLESS TO SAY THAT ASSESSEE WILL BE PROVIDED SUFFICIENT OPPORTUNITY OF BEING HEARD. 11. THE SAID ORDER WAS PASSED BY THE TRIBUNAL IN VIEW OF THE JUDGMENT DATED 12/1/2017 OF THE HON'BLE ALLAHABAD HIGH COURT IN THE ASSESSEES OWN CASE, WHEREIN, ON AN APPEAL FILED BY THE DEPARTMENT, THE HON'BLE ALLAHABAD HIGH COURT HAD REMITTED THE ISSUE TO THE TRIBUNAL BY HOLDING AS UNDER: 8. HOWEVER, WE FIND THAT IF STATUTE PERMITTING DEPRECIATION AT PARTICULAR RATE ITSELF HAS BEEN AMENDED AND SUCH AMENDMENT IS APPLICABLE TO DISPUTED PERIOD OF ASSESSMENT, IT ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 11 OF 16 IS A SUBSTANTIAL QUESTION OF LAW AND CAN BE RAISED BEFORE THIS COURT BUT SINCE IT MAY ALSO INVOLVE SOME FACTUAL INVESTIGATION, WE FIND IT APPROPRIATE TO REMAND THIS MATTER TO TRIBUNAL TO LOOK INTO THIS ASPECT AND PASS A FRESH ORDER IN ACCORDANCE WITH LAW. 9. IN VIEW OF ABOVE, APPEAL IS ALLOWED PARTLY. IMPUGNED ORDER DATED 30.04.2015 IS MODIFIED ONLY TO THE EXTENT THAT PARTIES SHALL BE ALLOWED TO ADDRESS TRIBUNAL ON AFORESAID QUESTION AND AFTER GIVING OPPORTUNITY OF HEARING TO BOTH PARTIES, TRIBUNAL SHALL DECIDE SUCH QUESTION, IN ACCORDANCE WITH LAW, EXPEDITIOUSLY. 12. IN VIEW OF THESE FINDINGS OF THE HON'BLE HIGH COURT, THE TRIBUNAL HAD REMITTED THE ISSUE TO THE ASSESSING OFFICER TO RE- ADJUDICATE THE ISSUE, KEEPING IN VIEW THE PAST ASSESSMENT ORDERS AND THE FACTS OF THE PRESENT APPEALS. THE LD. COUNSEL FOR THE ASSESSEE ARGUED THAT IN EARLIER YEARS, IN SCRUTINY ASSESSMENTS, SUCH ADDITIONS WERE NOT MADE AND IN ASSESSMENT YEAR 1995-96, THE HON'BLE ALLAHABAD HIGH COURT HAD EVEN DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE, VIDE ORDER DATED 14/8/2013, BY HOLDING AS UNDER: ON 13.07.2011, A COORDINATE BENCH HAD ADMITTED THE APPEAL ON THE FOLLOWING SUBSTANTIAL QUESTION OF LAW:- 'WHETHER THE LEARNED INCOME TAX APPELLATE TRIBUNAL HAS ERRED IN LAW AND IN FACTS IN ALLOWING DEPRECIATION, CLAIMED BY ASSESSEE ON CLOSING BALANCE OF SHUTTERING MATERIAL (UNUSED) VALUED AT RS.65,61,623/-?' THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, A STATE CORPORATION, IS ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION WORK SPECIALLY FOR THE CONSTRUCTING THE BRIDGES IN INDIA AS WELL AS ABROAD. DURING THE ASSESSMENT YEAR UNDER CONSIDERATION, THE ASSESSEE HAS FILED THE LOSS RETURN WHICH WAS AGAIN REVISED ON 31.03.1997 BY SHOWING LOSS. DURING SCRUTINY, THE A.O. FOUND THAT THE ASSESSEE HAS CLAIMED THE DEPRECIATION OF RS.65,61,623/- ON THE SHUTTERING MATERIAL. ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 12 OF 16 A.O. HAS DISALLOWED THE SAME. THE CIT HAS CONFIRMED THE ORDER. HOWEVER, THE TRIBUNAL HAS ALLOWED THE CLAIM OF THE ASSESSEE BY FOLLOWING ITS EARLIER ORDER FOR THE ASSESSMENT YEAR 1988-89. BEING AGGRIEVED, THE DEPARTMENT HAS FILED THE INSTANT APPEAL. WITH THIS BACKGROUND, SRI D.D.CHOPRA, LEARNED COUNSEL FOR THE DEPARTMENT HAS JUSTIFIED THE AO'S ORDER. HE SUBMITS THAT SHUTTERING MATERIAL IS A CONSUMABLE ITEM IN BRIDGE CONSTRUCTION ACTIVITY AND AS AND WHEN USED IT IS CONSUMED IN ENTIRETY. THEREFORE, THE ITEM OF SHUTTERING WHICH IS NOT SO USED CAN NEVER GET THE BENEFIT OF SECTION 32 AS IT HAS TECHNICALLY NEVER BEEN PUT TO USE SO AS TO GET THE BENEFIT OF DEPRECIATION. HE FURTHER SUBMITS THAT THE ASSESSEE IS ACCOUNTING THE PURCHASE OF SHUTTERING MATERIAL IN TWO DIFFERENT WAYS. FIRSTLY, MATERIAL WHICH HAS BEEN USED AT THE WORK SITE IS DEBITED TO THE TRADING ACCOUNT AS WORK EXPENSES AND THEN WRITTEN OFF. SECONDLY, ON THE BALANCE LEFT, DEPRECIATION IS BEING CLAIMED @ 100%. THE SAME ITEM CAN NOT BE TREATED AS BOTH REVENUE AND CAPITAL RECEIPT, AS WRONGLY CLAIMED BY THE ASSESSEE. ON THE OTHER HAND, SRI R.A.SHANKHDHAR AND SRI SHISHIR JAIN, LEARNED COUNSEL FOR THE ASSESSEE HAS RELIED THE ORDER OF THE TRIBUNAL. AFTER HEARING BOTH THE PARTIES AND ON PERUSAL OF THE RECORD, IT APPEARS THAT IN THE EARLIER ASSESSMENT YEAR 1988-89, THE SIMILAR BENEFIT WAS GIVEN TO THE ASSESSEE, WHERE 100% DEPRECIATION WAS ALLOWED. DURING THE COURSE OF ARGUMENT, NONE OF THE PARTIES WAS ABLE TO TELL THE FATE OF THAT ORDER PASSED BY THE TRIBUNAL. IT MAY BE MENTIONED THAT IN THE INSTANT CASE, THE CONSTRUCTION OF THE BRIDGE IS THE MAIN BUSINESS ACTIVITY OF ASSESSEE FOR WHICH THE SHUTTERING IS AN ESSENTIAL ITEM. THE ASSESSEE IS THE COMPLETE OWNER OF THE SHUTTERING. WITHOUT SHUTTERING, NO BUILDING OR BRIDGE CAN BE ERECTED. SHUTTERING MATERIAL WAS TREATED AS A PLANT ON WHICH 100% DEPRECIATION IS ALLOWABLE AS PER THE RATIO LAID DOWN IN THE CASE OF HARIJAN AWAM NIRBAL VARG AVAS NIGAM VS. CIT 1998, 229 ITR, 776 ALLD. ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 13 OF 16 SIMILAR VIEWS WERE ALSO EXPRESSED IN THE CASE OF CIT VS. MOHTA CONSTRUCTION COMPANY 273 ITR, 276 RAJASTHAN. FURTHER, IN THE INSTANT CASE, IT WAS CLAIMED BY THE DEPARTMENT THAT THE SHUTTERING WAS NOT USED, IT WAS KEPT UNUSED. BUT IT MAY BE MENTIONED THAT IN THE CASE OF DINESH KUMAR GULABCHAND AGARWAL VS. CIT 276 ITR, 768 BOMBAY, IT WAS HELD THAT:- 'THE WORD 'USED' IN SECTION 32 OF THE INCOME-TAX ACT, 1961, DENOTES THAT THE ASSET HAS BEEN ACTUALLY USED AND NOT THAT IT IS MERELY READY FOR USE. THE EXPRESSION 'USED' MEANS ACTUALLY USED FOR THE PURPOSE OF THE BUSINESS.' IN THE INSTANT CASE, THE ASSESSEE WAS THE OWNER OF THE SHUTTERING WHICH WAS READY TO USE. WHEN IT IS SO, THEN THE ASSESSEE IS ENTITLED FOR 100% DEPRECIATION, AS RIGHTLY OBSERVED BY THE TRIBUNAL. THEREFORE, WE FIND NO REASON TO INTERFERE WITH THE IMPUGNED ORDER PASSED BY THE TRIBUNAL AND THE SAME IS HEREBY SUSTAINED ALONG WITH THE REASONS MENTIONED THEREIN. THE ANSWER TO THE SUBSTANTIAL QUESTION OF LAW IS IN FAVOUR OF THE ASSESSEE AND AGAINST THE DEPARTMENT. IN THE RESULT, APPEAL FILED BY THE DEPARTMENT IS DISMISSED. 13. THOUGH, IN ASSESSMENT YEAR 1995-96, THE HON'BLE HIGH COURT TOOK NOTE OF THE RATIO LAID DOWN IN THE CASE OF HARIJAN EVAM NIRBAL VARG AVAS NIGAM LTD. VS. CIT(SUPRA), WHEREBY, SHUTTERING WAS HELD TO BE PLANT, BUT IT DID NOT FIND ANY INFIRMITY IN THE ORDER OF THE TRIBUNAL AND THE ASSESSEE WAS ALLOWED RELIEF OF 100% DEPRECIATION ON SHUTTERING. 14. IT IS AN UNDISPUTED FACT THAT IN THE SUCCEEDING ASSESSMENT YEARS, AFTER ASSESSMENT YEAR 1995-96, NO ADDITION WAS MADE BY THE ASSESSING OFFICER ON ACCOUNT OF SHUTTERING, THOUGH THE ASSESSMENTS WERE COMPLETED UNDER SECTION 143(3) OF THE ACT, EXCEPT DURING ASSESSMENT YEAR 2005-06, WHEREIN, THE ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 14 OF 16 CASE OF THE ASSESSEE WAS REOPENED UNDER SECTION 148 OF THE ACT, RELYING ON HARIJAN EVAM NIRBAL VARG AVAS NIGAM LTD. VS. CIT(SUPRA) AND WHICH WAS QUASHED BY THE ITAT, ON A LEGAL ISSUE VIDE ORDER DATED 1/10/2015 AND THE DEPARTMENT DID NOT AGITATE THE MATTER FURTHER BEFORE THE HON'BLE HIGH COURT. WE FURTHER FIND THAT UPTO ASSESSMENT YEAR 2008-09, THE ASSESSMENTS WERE COMPLETED UNDER SECTION 143(3) OF THE ACT AND THE REVENUE DID NOT DRAW ANY ADVERSE VIEW REGARDING THE USE OF SHUTTERING. THE ASSESSING OFFICER WAS SPECIFICALLY DIRECTED, VIDE ORDER OF THE TRIBUNAL DATED 12/2/2018 TO RE-ADJUDICATE THE ISSUE KEEPING IN VIEW THE PAST ASSESSMENTS. HOWEVER, RELYING ON THE JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF ITO VS. M/S TECH SPAN INDIA PVT. LTD. (SUPRA), HE DID NOT FOLLOW THE EARLIER ASSESSMENT ORDERS, BY HOLDING THAT IF NO OPINION IS EXPRESSED BY THE ASSESSING OFFICER ON A PARTICULAR ISSUE, THEN IN SUCCEEDING YEARS, THAT CANNOT BE TAKEN TO BE A PRECEDENT. WE FIND THAT AS CORRECTLY SUBMITTED ON BEHALF OF THE ASSESSEE, THE SAID JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF ITO VS. M/S TECH SPAN INDIA PVT. LTD. (SUPRA) WAS ON A DIFFERENT ISSUE AND WAS IN THE CONTEXT OF THE PROVISIONS OF SECTION 148 OF THE ACT AND IN THAT CASE, THE HON'BLE APEX COURT HAS HELD THAT IN TERMS OF ASSESSMENT PROCEEDINGS, THE WORDS CHANGE OF OPINION IMPLIES FORMATION OF OPINION AND THEN A CHANGE THEREOF. THE HON'BLE APEX COURT HAD HELD THAT THERE CANNOT BE A CHANGE OF OPINION IN CASES WHERE THE ORDER OF ASSESSMENT DOES NOT ADDRESS ITSELF TO A GIVEN ASPECT SOUGHT TO BE EXAMINED IN THE REASSESSMENT PROCEEDINGS. THIS CASE OF THE HON'BLE APEX COURT HAS BEEN RELIED ON BY THE AUTHORITIES BELOW TO DISCARD THE TREATMENT OF SHUTTERING/SCAFFOLDING IN THE CASE OF THE ASSESSEE IN EARLIER YEARS. HOWEVER, WE FIND THAT THIS CASE LAW IS ALTOGETHER ON A DIFFERENT ISSUE, WHICH IS NOT APPLICABLE HEREIN, AS THE CASE AT ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 15 OF 16 HAND IS NOT THAT OF REOPENING OF A COMPLETED ASSESSMENT, BUT OF A REGULAR ASSESSMENT, WHERE THE QUESTION OF CHANGE OF OPINION IS NOT UNDER CONSIDERATION. THE ASSESSING OFFICER SHOULD HAVE COMPLETED THE ASSESSMENT AFTER TAKING INTO ACCOUNT THE SCRUTINY ASSESSMENT ORDERS IN THE CASE OF THE ASSESSEE IN EARLIER YEARS. 15. IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDERS OF THE LD. CIT(A) FOR ASSESSMENT YEARS 2009-10 AND 2010-11 AND DIRECT THE ASSESSING OFFICER TO READJUDICATE THE ISSUE AS PER THE DIRECTIONS OF THE TRIBUNAL AS CONTAINED IN ORDER DATED 12/2/2018. 16. CONSEQUENT TO OUR THIS ORDER, DISPOSING OF THE APPEALS OF THE ASSESSEE IN ITA NOS.600 & 601/LKW/2019, ON MERITS, THE STAY APPLICATION NOS. 39 & 40/LKW/2019, ARISING OUT OF THESE APPEALS, ON WHICH AN ORDER, DATED 25/10/2019, HAS BEEN PASSED BY THIS BENCH OF THE TRIBUNAL, GRANTING STAY OF DEMAND FOR A PERIOD OF SIX MONTHS OR TILL THE DISPOSAL OF THE APPEALS, NOW DO NOT SURVIVE. THEREFORE, THE MISCELLANEOUS APPLICATIONS FILED BY THE REVENUE WITH A REQUEST TO RECALL THE ORDER, DATED 25/10/2019 IN S.A. NOS. 39 & 40/LKW/2019, HAVE BECOME INFRUCTUOUS AND HENCE THE SAME ARE REJECTED. 17. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES AND THE MISCELLANEOUS APPLICATIONS OF THE DEPARTMENT ARE REJECTED. ORDER PRONOUNCED IN THE OPEN COURT ON 20/03/2020. SD/ - SD/ - [ A. D. JAIN ] [T.S. KAPOOR] VICE PRESIDENT ACCOUNTAN T MEMBER DATED:20/03/2020 JJ:1802 ITA NOS.600 & 601/LKW/2019 M.A. NOS.48 & 49/LKW/2019 IN S.A. NOS.39&40/LKW/2019 PAGE 16 OF 16 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR BY ORDER ASSISTANT REGISTRAR