ACIT 2(3), MUMBAI V. DEVELOPMENT CREDIT BANK LTD, MUMBAI

ITA 6072/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92766 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2009-2010
• Appeal Filed On: 17-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LOVE KUMAR
• Keywords: Depreciation; Revised return; Unabsorbed depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL ' D ' BENCH, MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI SANJAY ARORA , ACCOUNTANT MEMBER ITA NO. 6072/MUM/2013 (ASSESSMENT YEAR: 2009 - 10 ) A C I T - 2(3) VS. M/S. DEVELOPMENT CREDIT BANK LTD. ROOM NO. 552, 5TH FLOOR AYAKAR BHAVAN, M.K. ROAD MUMBAI 400020 TRADE POINT, 1ST FLOOR, KAMLA MILLS COMPOUND, LOWER PAREL MUMBAI 400013 PAN - AAACD1461F APPELLANT RESPONDENT APPELLANT BY: SHRI LOVE KUMAR RESPONDENT BY: SHRI SATISH R. MODY DATE OF HEARING: 16.06. 2015 DATE OF PRONOUNCEMENT: 16.06.2015 O R D E R PER D. MANMOHAN, V.P. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) - 14, MUMBAI AND IT PERTAINS TO A.Y. 2009 - 10. 2. FOLLOWING GROUNDS WERE URGED BEFORE US: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED ALLOWING THE DEPRECIATION ON ASSETS LEASED OUT, WHEN THE RELATED TRANSACTIONS WERE PURELY FINANCIAL TRANSACTIONS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LA W, THE LD. CIT(A) ERRED IN NOT FOLLOWING THE DECISION OF SPECIAL BENCH IN THE CASE OF INDUSIND BANK, AS REPORTED IN 135 ITD 165, AND THE RATIOS LAID DOWN BY THE HON'BLE SUPREME COURT OF INDIA IN THE CASE OF ASIAN BROWN BOVERI LTD., AS REPORTED IN 54 TAXMAN 512 (SC). 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN NOT ADHERING TO JUDICIAL DISCIPLINE IN NOT FOLLOWING THE DECISION OF A HIGHER BENCH, GIVEN IN THE CASE OF INDUSIND BANK AS REPORTED IN 135 ITD 65. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN ALLOWING THE CLAIM OF RS.60,09,716/ - BEING PREMIUM PAID FOR HEALTH INSURANCE OF EMPLOYEES WITHOUT APPRECIATING THAT NO SUCH CLAIM IS MADE IN THE RETURN OF INCOME OR ITA NO. 6072/MUM/2013 M/S. DEVELOPMENT CREDIT BANK LTD. 2 ANY REVISED RETURN OF INCOME THE THEREFORE, THE SAME WAS RIGHTLY DISALLOWED BY THE AO AS PER RATIO LAID DOWN BY APEX COURT IN THE CASE OF GOETZ INDIA LTD. 284 ITR 323. 3. FACTS NECESSARY FOR DISPOSAL OF THE APPEAL ARE STATED IN BRIEF. ASSESSEE - COMPANY IS ENGAGED IN BAN KING BUSINESS AND ALSO DEALS IN SALE/ PURCHASE OF GOVERNMENT SECURITIES, BONDS ETC. FOR THE YEAR UNDER CONSIDERATION IT DECLARED NIL INCOME AFTER SETTING OF BROUGHT FORWARD BUSINESS LOSSES AND UNABSORBED DEPRECIATION. 4. THE CASE HAVING BEEN SELECTED FOR SCRU TINY THE AO CALLED FOR RECORDS AND NOTICED THAT THE ASSESSEE PAID A SUM OF ` 60,09,796/ - TOWARDS PREMIUM FOR HEALTH INSURANCE OF EMPLOYEES BUT DEDUCTION WAS NOT CLAIMED IN THAT REGARD. THE CASE OF THE ASSESSEE WAS THAT IT WAS INADVERTENTLY NOT ADDED IN THE INCOME TAX RETURN. THE AO DID NOT ACCEPT THE PLEA OF THE ASSESSEE IN THE LIGHT OF THE JUDGEMENT OF THE APEX COURT IN THE CASE OF GOETZ INDIA LTD. 284 ITR 323 AND OBSERVED THAT THE ASSESSEE HAVING NOT MADE THE CLAIM BY FILING REVISED RETURN IT IS NOT COMPET ENT TO CLAIM ANY DEDUCTION AT A LATER STAGE. 5. ASSESSEE CLAIMED DEPRECIATION OF ` 31,88,111/ - ON LEASED ASSETS. IN VIEW OF THE DEPARTMENT S STAND IN EARLIER YEARS O N THIS ISSUE, ASSESSEES CLAIM OF DEPRECIATION WAS DISALLOWED BY THE AO. 6. ON AN APPEAL FILED BY THE ASSESSEE THE LEARNED CIT(A) OBSERVED THAT IN THE EARLIER YEARS ALSO THE AO HAS DISALLOWED DEPRECIATION ON LEASED ASSETS WITHOUT VERIFYING THE TRANSACTIONS PROPERTY, ON THE BASIS OF SUSPICION AND ASSUMPTIONS , WHEREAS IDENTICAL ISSU E WAS DECIDED BY THE ITAT MUMBAI BENCHES IN ASSESSEES OWN CASE FOR EARLIER YEARS. BASED ON THE DECISION OF THE ITAT IN ASSESSEES OWN CASE FOR EARLIER YEARS THE LEARNED CIT(A) DELETED THE ADDITION OF ` 31,88,111/ - . 7. SIMILARLY, WITH REGARD TO ADDITION OF ` 60 ,09,716/ - THE LEARNED CIT(A) NOTICED THAT IN THE LIGHT OF THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF PRUTHVI SHARE BROKERS PVT. LTD. (2012) 23 TAXMANN.COM 23 (BOM) ASSESSEE IS ENTITLED TO RAISE THE ISSUE BEFORE THE APPELLATE AUTHORITY BY WAY OF ADDITIONAL GROUND AND THUS THE ADDITIONAL GROUND WAS ADMITTED SINCE ALL THE RELEVANT DETAILS IN SUPPORT OF ITS CLAIM WERE ON RECORD. HE ALSO OBSERVED ITA NO. 6072/MUM/2013 M/S. DEVELOPMENT CREDIT BANK LTD. 3 THAT TAX CAN BE LEVIED ONLY ON THE LEGITIMATE AND CORRECT TAXABLE INCOME TO BE DETERMINED IN ACCOR DANCE WITH THE PROVISION OF THE ACT. UPON ADMISSION OF THE ADDITIONAL CLAIM OF DEDUCTION , REFERABLE TO PREMIUM ON HEALTH INSURANCE OF THE EMPLOYEES, ASSESSEE WAS DIRECTED TO PRODUCE ALL THE RELEVANT DETAILS TO THE AO AND THE AO WAS DIRECTED TO DO NECESSARY VERIFICATION TO EXAMINE THE CLAIM AND ALLOW RELIEF. IN OTHER WORDS, THE LEARNED CIT(A) OBSERVED THAT MERELY BECAUSE A SPECIFIC PLEA WAS NOT RAISED BY FILING A REVISED RETURN THE ASSESSEE CANNOT BE DEBARRED, IF IT IS OTHERWISE ELIGIBLE. 8. AGGRIEVED BY THE ORDER PASSED BY THE LEARNED CIT(A) ON THE ABOVE MENTIONED TWO ISSUES, REVENUE IS IN APPEAL BEFORE US. AT THE TIME OF HEARING T HE LEARNED COUNSEL FOR THE ASSESSEE PLACED BEFORE US A COPY OF THE ORDER PASSED BY THE ITAT J BENCH, MUMBAI IN ASSESSEES OWN CASE FOR ASSESS MENT YEARS 1996 - 97 TO 2008 - 09 ( ITA NO. 3006/MUM/2001 AND OTHERS) TO SUBMIT THAT THE ASSESSEE WAS HELD TO BE ENTITLED TO THE CLAIM OF DEPRECIATION , SINCE & SALE LEASE BACK TRANSACTION IS A GENUINE TRANSACTION AND ASSET HAVING BEEN PUT TO USE, CLAIM OF THE ASS ESSEE IS IN ACCORDANCE WITH LAW. THIS COVERS GROUND NOS. 1, 2 &3. 9. WITH REGARD TO GROUND NO. 4, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE DECISION OF THE APEX COURT IN THE CASE OF GOETZ INDIA LTD. 284 ITR 323 WAS EXAMINED BY THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF PRUTHVI SHARE BROKERS PVT. LTD. AND HELD THAT ASSESSEE IS ENTITLED TO RAISE A LEGITIMATE CLAIM EVEN BEFORE THE FIRST APPELLATE AUTHORITY AND THUS THE DECISION TAKEN BY THE LEARNED CIT(A) IS IN CONSONANCE WITH THE VIEW TAKEN BY TH E JURISDICTIONAL HIGH COURT. 10. ON THE OTHER HAND, THE LEARNED D.R. SUBMITTED THAT THOUGH THE ISSUES ARE COVERED BY THE AFORECITED DECISION, THE DEPARTMENT HAS NOT AGREED WITH THE VIEW TAKEN BY THE ITAT IN ASSESSEES OWN CASE FOR EARLIER YEARS AND ALSO SUBMIT TED THAT THE DECISION OF THE APEX COURT IN THE CASE OF GOETZ INDIA LTD. PREVAILS OVER THE DECISION OF THE HON'BLE BOMBAY HIGH COURT. 11. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE RECORD. AS RIGHTLY POINTED OUT BY THE LEARNED COUNSEL FOR THE ASSESSEE, BOTH THE ISSUES STAND COVERED BY THE DECISION OF THE ITAT IN ASSESSEES OWN CASE FOR ITA NO. 6072/MUM/2013 M/S. DEVELOPMENT CREDIT BANK LTD. 4 EARLIER YEARS (GROUND NOS. 1, 2 & 3) AND THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF PRUTHVI SHARE BROKERS PVT. LTD. (GROUND NO. 4). UNDER THES E CIRCUMSTANCES THE VIEW TAKEN BY THE LEARNED CIT(A) DOES NOT CALL FOR ANY INTERFERENCE. WE, THEREFORE, AFFIRM THE ORDER PASSED BY THE LEARNED CIT(A). 12. IN THE RESULT, THE APPEAL FILED BY REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH JUNE, 2015. SD/ - SD/ - ( SANJAY ARORA ) (D. MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATED: 16 TH JUNE, 2015 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 14 , MUMBAI 4. THE CIT 6 , MUMBAI CITY 5. THE DR, D BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.