The DCIT, Circle-4, Ahmedabad V. Gyscoal Alloys Ltd., Ahmedabad

ITA 620/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 94588 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 7 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 28-08-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 28-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K PANDEY
• Keywords: Depreciation; Principle of natural justice; Additional depreciation; Additional evidence; Valuation report

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH AHMEDABAD BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER, AND SHRI S. S. GODARA, JUDICIAL MEMBER. ITA. NO. 620/AHD/2011 (ASSESSMENT YEAR:2007-08) THE DCIT, CIRCLE-4, AHMEDABAD APPELLANT VS. GYSCOAL ALLOYS LTD., 2 ND FLOOR, MRUDUAL TOWERS, B/H. TIMES OF INDIA BUILDING, ASHRAM ROAD, AHMEDABAD RESPONDE NT PAN: AAECS6731M / BY REVENUE : SHRI A. K. PANDEY, SR. D.R. / BY ASSESSEE : SHRI SUNIL TALATI, A.R. /DATE OF HEARING : 28.08.2015 /DATE OF PRONOUNCEMENT :21.10.2015 ORDER PER S. S. GODARA, JUDICIAL MEMBER THIS REVENUES APPEAL FOR ASSESSMENT YEAR 2007-08, ARISES FROM ORDER OF THE CIT(APPEALS)-VIII, AHMEDABAD, DAT ED ITA NO.620/AHD/2011 (DCIT VS. GYSCOAL ALLOYS LTD.) A.Y. 2007-08 - 2 - 16.12.2010 PASSED IN APPEAL NO. CIT(A)-VIII/IDC-4/7 57/09-10, IN PROCEEDINGS U/S.143(3) OF THE INCOME TAX ACT, 19 61, HEREAFTER THE ACT. 2. THE REVENUES FIRST SUBSTANTIVE GROUND CHALLENGE S CIT(A)S ORDER DELETING DISALLOWANCE OF RS.75,89,298/- OF DE PRECIATION AND ADDITIONAL DEPRECIATION AS MADE BY THE ASSESSING OF FICER IN A REGULAR ASSESSMENT FRAMED ON 29.12.2009. THE ASSES SEE COMPANY TRADES IN ENGINEERING SPHERES AND TOOLS. I T HAD FILED BILLS OF FIXED ASSETS AND LEDGER OF M/S. COLLECTIVE MARKETING PVT. LTD. SHOWING PURCHASES THERE FROM OF RS.1,41,65,777 /-. THE ASSESSING OFFICER IN COURSE OF SCRUTINY NOTICED THI S PAYEE ENTITY TO HAVE BEEN OPERATING FROM AHMEDABAD. THE ARRAY OF S UPPLIED PRODUCTS READS CONSUMABLE STORES, SPHERES FOR FURNI SHED DIVISION, LATHE MACHINE, WATER PUMP SET, POLISHING MACHINE, STRAIGHTENING MACHINE, SHARPER MACHINE AND OTHER PL ANT AND MACHINERY, SEND FILING WORK FOR THEIR NEW PROJECTS ETC. THE ASSESSEE HAD SHOWN FURTHER PURCHASES OF FIXED ASSET S OF RS.75,17,932/- FROM ANOTHER ENTITY M/S. D & H ENTER PRISE OPERATING FROM THE VERY AHMEDABAD ADDRESS. THE AUT HORIZED SIGNATORY AT BOTH THE ENTITIES BEHEST HAPPENED TO BE THE SAME PERSON. THE ASSESSING OFFICER ACCORDINGLY SOUGHT F ROM ASSESSEE RETURN OF INCOME FILED BY BOTH THIS CONCERNS, THEIR BANK STATEMENT AND NARRATION OF MAJOR ENTRIES. THE ASSE SSEE APPEARS TO HAVE FURNISHED RETURN OF M/S. COLLECTIVE MARKETI NG PVT. LTD. ONLY RS.41,095/-. THE ASSESSING OFFICER PERUSED IT S BANK STATEMENT DEMONSTRATING ITS DEALINGS WITH ASSESSEE ONLY. HE FURTHER NOTICED THAT EACH CREDIT PAYMENT INSTANCE I N ASSESSEES CASE CORRESPONDED TO A WITHDRAWAL OF CASH AMOUNT TO ALMOST THE ITA NO.620/AHD/2011 (DCIT VS. GYSCOAL ALLOYS LTD.) A.Y. 2007-08 - 3 - SAME EXTENT THROUGH SELF AND BEARER CHEQUES. HE AL SO TOOK INTO CONSIDERATION THE FACT THAT THE ASSESSEE HAD NOT SU BMITTED THE RELEVANT DETAILS OF LATER ENTITY M/S. D & H ENTERPR ISE. HE ACCORDINGLY OBSERVED THAT ASSESSEES PURCHASE OF FI XED ASSETS AGGREGATING TO RS.2,16,82,709/- APPEARED TO BE BOGU S AND DEPRECIATION OF RS.32,52,556/- WITH ADDITIONAL DEPR ECIATION OF RS.43,36,742/- HAD TO BE DISALLOWED. HE ACTED ACCO RDINGLY AND INVOKED THE IMPUGNED GROSS DISALLOWANCE OF RS.75,89 ,298/-. 3. THE ASSESSEE PREFERRED APPEAL. IT FILED ADDITIO NAL EVIDENCE IN THE NATURE OF SALES BILLS OF THIRD PARTIES FROM WHOM THE SUPPLIER M/S. COLLECTIVE MARKETING PVT. LTD. HAD MA DE THE PURCHASES AND SUPPLIED THE SAME TO THE ASSESSEE ALO NG WITH COPY OF BANK STATEMENT OF M/S. D & H ENTERPRISE, LOAN SA NCTIONING LETTERS, PURCHASE DISBURSEMENT OF MACHINERIES, PHOT OGRAPHS OF THE SAME BEING INSTALLED ALONG WITH COPY OF VALUATI ON REPORT OBTAINED BY THE BANK CERTIFYING THE MACHINERIES TO BE IN EXISTENCE. THE CIT(A) OBTAINED A REMAND REPORT, AL LOWED THE ABOVE STATED ADDITIONAL EVIDENCE THEREBY DELETING T HE IMPUGNED DISALLOWANCE AS UNDER: 12. GROUND NO.1 COMING TO THE GROUND NO.1 AS THE ASSESSEE COMPANY H AS POINTED OUT THAT TOTAL PURCHASE OF FIXED ASSETS DURING THE ASST. YEAR 2007-08 ARE OF RS.6,28,42,859/- AND TRANSFER FROM W.I.P. OF PREVIOUS YEAR I.E. ASST.YEAR 2006-07 IS OF RS.3,45,44,960/-. SO TOTAL ADDITION IN THE FIXED ASSETS DURING THE ASST. YEAR 2007-08 IS OF RS.9,73, 87,819/-. THIS STANDS ESTABLISHED FROM THE PUBLISHED AUDITED ACCOU NTS, WHICH ARE FILED AS PER PAPER BOOK PAGE 1 TO 29 MORE PARTICULA RLY ON PAGE 20 BEING SCHEDULE-5, I.E. FIXED ASSETS FORMING PART OF AUDIT ED ACCOUNTS. I ALSO FIND THAT THE ASSESSING OFFICER HAS MENTIONED STATI NG THAT THE PURCHASES MADE FROM COLLECTIVE MARKETING PVT. LTD. ARE OF RS.1,41,65,777/- AND FROM D & H ENTERPRISE ARE OF R S.75,17,932/- TOTALING TO RS.2,16,83,709/- AND THE ASSESSING OFFI CER HAS NOT GIVEN ITA NO.620/AHD/2011 (DCIT VS. GYSCOAL ALLOYS LTD.) A.Y. 2007-08 - 4 - ANY COMMENTS EVEN IN HIS REMAND REPORT ABOUT HOW SU CH FIGURE IS ARRIVED AT AS AGAINST THE AMOUNT OF PURCHASE EXPLAI NED BY THE APPELLANT COMPANY. ON THE BASIS OF THE DETAILS FIL ED, PURCHASES FROM THESE TWO PARTIES I.E. FROM COLLECTIVE MARKETING PV T. LTD. IS GIVEN IN A SUMMARY FORM TOTALING TO RS.83,28,336/-. COMPLETE C OPY OF BILLS OF ALL THESE PURCHASES WHICH ARE ON DIFFERENT DATES MENTIO NING THE DESCRIPTION, QUANTITY, RATE ETC. ARE FILED FROM PAG E 30 TO 49. SIMILARLY, TOTAL PURCHASES FROM D & H ENTERPRISES IS GIVEN IN SUMMARY FORM OF RS. 42,24,952/- AND COPIES OF ALL THE THREE BILLS FROM THE SAID PARTY MENTIONING INVOICE NO., RATE, PARTY'S SALES TAX NO. , TOTAL AMOUNT ETC. ARE THERE ON PAGE 51 TO 53. 13. THE ASSESSEE COMPANY TO NEGATE THE CONTENTI ON OF THE ASSESSING OFFICER THAT PURCHASES FROM COLLECTIVE MARKETING PV T. LTD. APPEARS TO BE NOT GENUINE, HAS FURTHER FILED PURCHASE BILLS OF TH E SAID COMPANY, I.E. COLLECTIVE MARKETING PVT. LTD. AND ARE RELEVANT TO THE PERIOD 1-4-2006 TO 31-3-2007 ONLY. THUS HOW COLLECTIVE MARKETING PVT. LTD. PROCURED THESE MATERIALS AND AFTER DOING NECESSARY FABRICATION SUP PLIED TO THE ASSESSEE COMPANY THESE ASSETS STANDS DISCHARGED. TH E ASSESSEE COMPANY HAS ALSO FILED COPY OF THE ACCOUNT OF THE A SSESSEE COMPANY IN THE AUDITED BOOKS OF COLLECTIVE MARKETING PVT. LTD. ON PAGE 73 TO 75 WHEREIN VARIOUS SUPPLIERS AND SOURCES OF THE SAID C OMPANY, LOANS TAKEN BY IT INCLUDING TERM LOAN, CASH CREDIT ETC. F ROM UCO. BANK ARE APPEARING. THIS PROVES THE NUMEROUS TRANSACTIONS TH E SAID COLLECTIVE MARKETING PVT. LTD. HAD UNDERGONE TO PURCHASE THE M ATERIAL AND IN TURN SUPPLIED THE ASSETS TO THE ASSESSEE COMPANY. MOREO VER, THE ASSESSEE COMPANY ALSO FILED BANK STATEMENT WITH UCO BANK, AS HRAM ROAD BRANCH, AHMEDABAD OF THE ASSESSEE COMPANY WHEREBY P AYMENT IN THE NATURE OF ACCOUNT PAYEE CHEQUES TO THE SAID PARTIES ARE MADE. PAGE 87 TO 94 OF THE PAPER BOOK IS THE CONFIRMATION OF VARI OUS SALES EFFECTED OF THE FIXED ASSETS BY THE SAID COLLECTIVE MARKETING P VT. LTD. DULY STAMPED AND SIGNED WITH ITS P. A. NO. 14. I HAVE CAREFULLY GONE THROUGH ALL THESE COP IES OF THE BANK ACCOUNT, COPY OF THE BILLS BEING PURCHASE BILLS BY THE SAID COLLECTIVE MARKETING PVT. LTD., COPIES OF THE ASSESSEE'S ACCOU NT WITH COLLECTIVE MARKETING PVT. LTD. AND HAVE ALSO VERIFIED THE ACCO UNT PAYEE CHEQUE PAYMENTS MADE BY THE ASSESSEE COMPANY TO THE SAID S UPPLIER. PURCHASE BILL OF THE ASSESSEE COMPANY, I.E. SALES B ILLS OF COLLECTIVE MARKETING PVT. LTD. CLEARLY STATES THE NAME AND ADD RESS OF THE SAID COMPANY, ITS GST AND CST NOS. AND COMPLETE DESCRIPT ION OF VARIOUS ASSETS SUPPLIED. I HAVE CAREFULLY EXAMINED THIS AN D I AM UNABLE TO ACCEPT THE VIEW POINT OF THE ASSESSING OFFICER THAT MERELY BECAUSE THERE ARE WITHDRAWALS IN THE BANK ACCOUNT OF COLLECTIVE M ARKETING PVT. LTD. AFTER THE ASSESSEE COMPANY MADE PAYMENTS TO IT, THE PURCHASES APPEAR TO BE BOGUS. SIMILARLY, THE ASSESSEE HAS DISCHARGED ITS FULL ONUS BY GIVING FULL DETAILS OF PURCHASE FROM D&H ENTERPRISE ON THE SAME LINE. THE SAID PARTY IS ALSO ASSESSED TO INCOME TAX AND T HE APPELLANT HAS GIVEN ALL DETAILS IN THE PAPER BOOK AS STATED ABOVE . IN VIEW OF THIS THE PURCHASES FROM THIS COMPANY ARE ALSO NOT BOGUS. OVE R AND ABOVE, IN ITA NO.620/AHD/2011 (DCIT VS. GYSCOAL ALLOYS LTD.) A.Y. 2007-08 - 5 - THE ADDITIONAL EVIDENCES THE ASSESSEE COMPANY HAS F ILED COPIES OF LOAN SANCTIONED LETTER OF UCO BANK AT PAGE 99 TO 106 OF THE PAPER BOOK, WHO HAD SANCTIONED A FRESH TERM LOAN OF RS.625 LACS FOR SETTING UP OF NEW FURNACE OF 4MT AND ONE ROLLING MILL OF 16 INCHES TO INCREASE THE CAPACITY OF THE EXISTING PLANT AND MACHINERIES AND ALSO INCR EASED WORKING CAPITAL LIMIT FROM RS.195 LACS TO RS.400 LACS. THE BANKS WHILE SANCTIONING SUCH LOAN MORE PARTICULARLY WHILE DISBU RSING THE LOAN NORMALLY VERIFY THE ASSETS OF THE COMPANY. THE ASSE SSEE COMPANY HAS ENCLOSED COPIES OF REQUEST LETTER FOR DISBURSEMENT OF LOAN FOR PURCHASE OF MACHINERIES FROM THESE TWO PARTIES NAMELY; COLLE CTIVE MARKETING PVT. LTD. AND D&H ENTERPRISE ON PAGE 107 TO 111 OF THE P APER BOOK. I HAVE ALSO EXAMINED THE COPY OF THE VALUATION REPORT SUBM ITTED BY GAJJAR TECHNO-ECONOMIC CONSULTANTS PVT. LTD. AS ON 21 ST MAY, 2008 FILED ON PAPER BOOK PAGE 127 TO 163 IN WHICH THE VALUER ALSO HAS CERTIFIED THE EXISTENCE AND VERIFICATION OF ALL THESE ASSETS. 15. MY VIEW GETS FURTHER STRENGTHEN FROM THE COPIES OF THE AUDITED ACCOUNTS, WHEREIN THE AUDITORS IN THEIR AUDITORS RE PORT APPEARING ON PAGE 12 OF THE PAPER BOOK HAVE CONFIRMED THAT THE A SSESSEE COMPANY HAS MAINTAINED PROPER RECORDS SHOWING FULL PARTICUL ARS INCLUDING QUANTITATIVE DETAILS AND SITUATION OF FIXED ASSETS. THE AUDITORS HAVE ALSO CERTIFIED THAT FIXED ASSETS HAVE BEEN PHYSICAL LY VERIFIED BY THE MANAGEMENT IN ACCORDANCE WITH A PROGRAMME OF VERIFI CATION, WHICH IN THE OPINION OF THE AUDITORS PROVIDES FOR PHYSICAL V ERIFICATION OF ALL THE FIXED ASSETS AT REASONABLE INTERVALS. WHEN THE ASSE SSEE COMPANY, WHICH IS A PUBLIC LIMITED COMPANY IS SUBJECT TO INT ERNAL AUDIT, STATUTORY AUDIT AS WELL AS TAX AUDIT AND WHEN THE AUDITORS IN THEIR CARO REPORT CERTIFIED THAT IN THE ASSESSEE COMPANY THERE ARE AD EQUATE INTERNAL CONTROL PROCEDURES COMMENSURATE WITH THE SIZE OF TH E COMPANY AND THE NATURE OF ITS BUSINESS FOR THE PURCHASE OF INVENTOR Y AND FIXED ASSETS ETC,. I SEE NO DOUBT OR SUSPICION WITH REGARD TO TR EATING THE FIXED ASSETS AS BOGUS. THE ASSESSING OFFICER HAS NOT BROUGHT ANY MATERIAL OR EVIDENCE EXCEPT MENTIONING THAT PURCHASES APPEAR TO BE DOUBTFUL PARTICULARLY ON THE GROUND THAT SUPPLIERS HAVE SHOW N VERY LITTLE INCOME OR HAVE WITHDRAWN THE CASH AFTER THE RECEIPT OF THE PAYMENTS. IN MY VIEW THE ASSESSEE HAS DISCHARGED ITS LIABILITY BY P RODUCING ALL THESE ADDITIONAL EVIDENCES ON WHICH THE ASSESSING OFFICER HAS NOT OFFERED ANY COMMENTS IN HIS REMAND REPORT. HAVING CAREFULLY GON E THROUGH ADDITIONAL EVIDENCES AS STATED ABOVE I AM OF THE VI EW THAT THE PURCHASES MADE BY THE ASSESSEE COMPANY OF THE FIXE D ASSETS BOTH FROM COLLECTIVE MARKETING PVT. LTD. AND D&H ENTERPR ISES ARE PROVED TO BE GENUINE AND OWNED BY THE ASSESSEE. IN VIEW OF TH IS THERE IS NO JUSTIFICATION IN DISALLOWING THE DEPRECIATION THERE OF. THE ADDITION MADE OF DISALLOWING DEPRECIATION AND ADDITIONAL DEPRECIA TION ON THESE ASSETS OF RS. 75,89,298/- IS THEREFORE DELETED. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE C ASE FILE. THE REVENUE SEEKS TO RESTORE THE ENTIRE DISALLOWANC E OF ITA NO.620/AHD/2011 (DCIT VS. GYSCOAL ALLOYS LTD.) A.Y. 2007-08 - 6 - DEPRECIATION AND ADDITIONAL DEPRECIATION QUA FIXED ASSETS PURCHASED FROM M/S. COLLECTIVE MARKETING PVT. LTD. AND M/S. D & H ENTERPRISE (SUPRA). RELEVANT FACTS ALREADY STA ND NARRATED IN THE PRECEDING PARAGRAPH. THE ASSESSING OFFICER HELD THE ASSESSEES PURCHASE BILLS OF THE ASSETS IN QUESTION AS BOGUS FOR THE REASONS STATED HEREINABOVE. THE CIT(A) HAS ACC EPTED ASSESSEES ADDITIONAL EVIDENCE AFTER DULY FOLLOWING PRINCIPLES OF NATURAL JUSTICE UNDER RULE 46A OF THE INCOME TAX RU LES. THE ASSESSEES ADDITIONAL EVIDENCE FILED IN LOWER APPEL LATE PROCEEDING AS WELL AS THE ONE ALREADY ON RECORD FOR EXAMPLE ALL NECESSARY PURCHASE BILLS OF DIFFERENT DATES MENTION ING DESCRIPTIONS, QUANTITY, RATE, SALES TAX DETAILS, IN VOICES, BOOKS, SOURCES OF THE SUPPLIERS COMPANY, THEIR LOANS TAKEN , CASH CREDITS, BANK STATEMENTS, CONFIRMATIONS, MODE OF PA YMENT BY WANT OF ACCOUNT PAYEE CHEQUES, INCOME TAX DETAILS E TC. HAVE BEEN TAKEN INTO CONSIDERATION FOR ACCEPTING ASSESSE ES CLAIM. THE REVENUE FAILS IN REBUTTING THE ABOVE STATED CON CLUSION UNDER CHALLENGE BY WAY OF REFERENCE TO PAPER BOOK O N RECORD COMPRISING OF ALL THESE NECESSARY DETAILS. WE ACCO RDINGLY AFFIRM THE CIT(A)S FINDING UNDER CHALLENGE. THE R EVENUES FIRST SUBSTANTIVE GROUND IS REJECTED. 5. THE REVENUES SECOND SUBSTANTIVE GROUND CHALLENG ES THE LOWER APPELLATE ORDER DELETING DISALLOWANCE OF RS.6 3,32,976/- BEING DEPRECIATION ON ROUGH FORGED ROLLS. THE ASSE SSEE HAD SUBMITTED ITS BILL PERTAINING TO PURCHASE OF THE FI XED ASSETS IN QUESTION I.E. ROUGH FORGED BLANKS FOR ROLLS BY WAY OF THREE DEALS DATED 22.03.2007 FORM M/S. TIRUPATI INDUSTRIES AT M ALERKOTLA, ITA NO.620/AHD/2011 (DCIT VS. GYSCOAL ALLOYS LTD.) A.Y. 2007-08 - 7 - PUNJAB AGGREGATING TO RS.1,26,65,952/-. IT CLAIM D EPRECIATION @80% ON THE SAME STATING USE OF THESE ASSETS FOR LE SS THAN 180 DAYS IN THE RELEVANT PREVIOUS YEAR. THE ASSESSING OFFICER SOUGHT FOR NECESSARY DETAILS OF TRANSPORTATION, DEL IVERY AND PUT TO USE OF THESE ROLLS. HE QUOTED ASSESSEES FAILURE IN FILING THE SAME. THIS LEAD TO DISALLOWANCE OF DEPRECIATIO N OF RS.50,66,381/- AND ADDITIONAL DEPRECIATION OF RS.12 ,66,595/- ON THE ABOVE STATED ROLLS BEING MADE IN THE ASSESSM ENT ORDER IN QUESTION. 6. THE ASSESSEE APPEARS TO HAVE FILED ADDITIONAL EV IDENCE QUA THIS ISSUE AS WELL I.E. COPY OF THE NECESSARY B ILLS (ALREADY ON RECORD), CERTIFICATE OF AN ENGINEER CONFIRMING T HAT ROLLS WERE PUT TO USE AND TRANSPORT RECEIPTS THEREOF. THE CIT (A) SOUGHT FOR A REMAND REPORT QUA THIS ISSUE AS WELL AND ACCE PTED ASSESSEES CORRESPONDING GROUND AS UNDER: 16. THE NEXT GROUND OF APPEAL IS WITH REGARD T O THE DISALLOWANCE OF DEPRECIATION OF ROUGH FORGED ROLLS. THE ASSESSEE CO MPANY IN ITS WRITTEN SUBMISSION AND PAPER BOOK HAS FILED THREE B ILLS FROM TIRUPATI INDUSTRIES ON PAGE 166 TO 168. ALL THESE THREE BIL LS FROM THE SUPPLIER CLEARLY MENTIONS THE BILL NO., DATE, ASSESSEE COMPA NY'S NAME, NAME OF THE TRANSPORTER, DETAILS LIKE PACKAGES , DESCRIPTIO N AND QUANTITY OF ROUGH FORGED BLANKS FOR ROLLS. THESE ROLLS WERE REC EIVED AT FACTORY PREMISES ON 22 ND MARCH, 2007 STANDS VERIFIED FROM THE COPIES OF THE LORRY RECEIPT, I.E. DELIVERY MEMO AND BILL OF RAJKO T GOLDEN TRANSPORT CORPORATION, WHO HAD PICKED UP THE GOODS ON 16 TH MARCH, 2007 FROM THE PREMISES OF TIRUPATI INDUSTRIES SITUATED AT MAL ERKOTLA AND DELIVERING THE SAME AT THE ASSESSEE'S FACTORY. 17. THE ASSESSEE COMPANY ENCLOSED A CERTIFICAT E FROM THE ENGINEER AT PAGE 170 OF THE PAPER BOOK. THE SAID CERTIFICATE IS FROM ONE MR. JAY D. SEVAK, WHO HAS CERTIFIED ON HIS LETTER HEAD THAT THE ASSESSEE COMPANY HAS PURCHASED MILLS ROLLS FROM TIRUPATI IND USTRIES GIVING DETAILS OF THE QUANTITY. SUCH QUANTITIES CERTIFIED BY HIM IN HIS CERTIFICATE DATED 11 TH SEPTEMBER, 2010 TALLIES WITH THE LORRY RECEIPT, I. E. AS PER THE GOODS DELIVERED BY THE TRANSPORTER TO THE ASSESSEE COMPANY. THE ASSESSING OFFICER AND ADDITIONAL C.I.T. IN THE REMA ND REPORT HAVE ITA NO.620/AHD/2011 (DCIT VS. GYSCOAL ALLOYS LTD.) A.Y. 2007-08 - 8 - COMMENTED THAT THE SAID ENGINEER IS MERELY CERTIFYI NG THAT THE ROLLING MILLS ARE INSTALLED AND USED FOR THE PRODUCTION AND THE CERTIFICATE NOWHERE MENTIONS THE DATE OF PUT TO USE IN THE CERT IFICATE AND THEREFORE IT WAS CONTENDED THAT NO RELIANCE BE PLACED ON SUCH CERTIFICATE. 18. I HAVE CAREFULLY GONE THROUGH THE DETAILED SUBMISSION, VARIOUS EVIDENCES FILED IN THE PAPER BOOK AND THE CONTENTIO N OF THE APPELLANT COMPANY. AS CAN BE SEEN FROM THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS DISALLOWED THE DEPRECIATION ON THE GROU ND THAT THE ASSESSEE WAS ASKED TO FURNISH DOCUMENTARY EVIDENCE OF TRANSP ORTATION, DELIVERY AND 'PUT TO USE' OF THESE ROLLS VIDE ORDER SHEET DA TED 25/11/2009 AND THE ASSESSEE COMPANY DID NOT PROVIDE ANY DOCUMENTS AND THEREFORE, DEPRECATION OF RS.50,66,381/- AND ADDITIONAL DEPREC IATION OF RS.12,66,595/- ARE DISALLOWED AND ADDED BACK TO THE TOTAL INCOME. HOWEVER, HAVING CAREFULLY PERUSED ALL THE PURCHASE BILL, TRANSPORT RECEIPT AND THE CERTIFICATE ISSUED BY THE ENGINEER IN MY MIND THERE IS NO DOUBT WITH REGARD TO RECEIPT OF ROLLS ON 22 MARCH, 2007. THE ASSESSEE HAS CLAIMED DEPRECIATION AT THE RATE OF 80% BUT AS ALSO OBSERVED BY THE ASSESSING OFFICER AT 1/2 RATE BECAUSE THE SAME WERE PUT TO USE FOR LESS THAN 180 DAYS. THE ASSESSEE COMPANY HAS DISCHARGED FULLY THE GENUINENESS OF ITS PURCHASES OF THESE ROLLS ON 22 ND MARCH, 2007 BY COGENT EVIDENCES AND THEREFORE THE ASSESSEE COMPANY IS ENTITLED TO THE DEPRECIATION AND ADDITIONAL DEPRECIATION THEREON. I N VIEW OF THIS DISALLOWANCE OF DEPRECIATION AND ADDITIONAL DEPRECI ATION OF RS.63,32,976/- IS DIRECTED TO BE DELETED. 7. HEARD BOTH THE PARTIES. RECORDS PERUSED. WE REI TERATE THAT THE ASSESSING OFFICER HAD INVOKED THE IMPUGNED DISA LLOWANCE FOR THE REASON THAT THE ASSESSEE HAD NOT BE ABLE TO PRO VE THE NECESSARY DETAILS OF ROLLS IN QUESTION BEING PURCHA SE FOLLOWED BY THEIR INSTALLATION IN PUT TO USE CONDITION BEFORE 3 1.03.2007. THIS RESULTED IN DISALLOWANCE OF DEPRECIATION AND ADDITI ONAL DEPRECIATION IN QUESTION. THE CIT(A) DISCUSSES IN THE ABOVE EXTRACTED FINDINGS THAT RELEVANT DOCUMENT OF TRANSP ORTATION, DELIVERY AND PUT TO USE CONDITION BEFORE 31.03.2007 ARE ALREADY ON RECORD. THE ASSESSEE HAS ALSO FILED A COMPILATI ON OF ALL THESE DOCUMENTS BEFORE US. THE REVENUE FAILS TO CONTROVE RT THE SAME BY TAKING US TO ANY OF THE RELEVANT MATERIAL. WE U PHOLD THE ITA NO.620/AHD/2011 (DCIT VS. GYSCOAL ALLOYS LTD.) A.Y. 2007-08 - 9 - CIT(A)S FINDING UNDER CHALLENGE ACCORDINGLY. THIS SECOND SUBSTANTIVE GROUND IS ALSO DECLINED. 8. THIS REVENUES APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS THE 21 ST DAY OF OCTOBER, 2015. SD/- SD/- (PRAMOD KUMAR) (S. S . GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: DATED 21/10/2015 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- / REVENUE 2 / ASSESSEE ! / CONCERNED CIT 4 !- / CIT (A) ( )*+ ,--. . /0 / DR, ITAT, AHMEDABAD 1 +23 45 / GUARD FILE. BY ORDER / . // . /0