ACIT -16(1), MUMBAI V. MEHERNOSH R. CURRAWALA, MUMBAI

ITA 6544/MUM/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3972 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-05-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2002-2003
• Appeal Filed On: 07-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESHWARI MOTWANI
• Assessee Lawyers: DR K SHIVARAM
• Keywords: Depreciation; Tax effect
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B , MUMBAI BEFORE SHRI B.R. BASKARAN , ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA , JUDICIAL MEMBER ITA NO. 6544 /MUM/201 3 (ASSESSMENT YEAR : 200 2 - 03 ) ACIT - 16(1), MUMBAI (APPELLANT) VS SHRI MEHERNOSH R. CURRAWALA PROP. ZODIAC TRANSPORT, 501, CUMBALLA CREST, 42, PEDDAR ROAD, MUMBAI 400 026 PAN : AAAPC3779K (RESPONDENT) APPELLANT BY : SMT. RAJESHWARI MOTWANI RESPONDENT BY : DR. K. SHIVARAM DATE OF HEARING : 05 /0 5 /2016 DATE OF PRONOUNCEMENT : 05 /0 5 /2016 O R D E R PER AMIT SHUKLA, JM : THE AFORESAID APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE IMPUGNED ORDER DATED 22.08.2013 PASSED BY CIT(A) - 27, MUMBAI FOR THE QUANTUM OF ASSESSMENT PASSED U/S. 143(3) OF THE INCOME TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2002 - 03 ON THE FOLLOWING GROUNDS OF APPEAL : - 1. THE LD. CIT(A) ERRED IN ESTIMATING THE VALUATION OF ASSETS BASED ON AVERAGE VALUATION OF DEPARTMENT VALUER AND ASSESSEE VALUER EVEN THOUGH HUGE DIFFERENCE OF VALUATION WAS NOTED; VIZ. RS. 7,30,000/ - TO RS.48,32,500/ - RESPECTIVELY. 2 SHRI MEHERNOSH R. CURRAWALA ITA NO. 6544/MUM/2013 2. THE LD. CIT(A) FAILED TO APPRECIATE THAT THE A.O., WHILE GIVING EFFECT TO ORDER OF HON. ITAT, MUMBAI BEARING ITA NO. 3276/MUM/2007 DATED 25.02.2010 REGARDING COMPUTATION OF DEPRECIATION HAD ALREADY INCREASED D EPRECIATION FROM RS.3,04,000/ - TO RS.7,56,500/ - AFTER CONSIDERING ASSESSEES CONTENTIONS. 3. THE LD. CIT(A) ERRED IN ESTIMATING THE VALUATION OF ASSETS BASED ON AVERAGE VALUATION OF DEPARTMENT VALUER AND ASSESSEE VALUER AS INCOME TAX ACT DOES NOT PERMIT S UCH MANDATORY COMPUTATION. 4. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY. 2. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE, DR. K. SHIVARAM POINTED OUT THAT THE TAX EFFECT ON DISPUTED ISSUE IS LE SS THAN RS. 10 LACS. IN SUPPORT, HE GAVE THE FOLLOWING CALCULATION OF TAX : - TAX EFFECT CALCULATION PARTICULARS A.O. CIT(A) 6 BATTERY OPERATED FORKLIFTS (DEPRECIATION @ 100%) 7,30,000 7,30,000 27,81,250 27,81,250 1 GODREJ MAKE BATTERY OPERATED FORKLIFTS (DEPRECIATION @ 100%) 2,500 2,500 50,000 50,000 3 VOLTAS MAKE DIESEL FORKLIFTS (DEPRECIATION @ 40%) 60,000 24,000 3,00,000 1,20,000 TOTAL 7,56,500/ - 29,51,250 DIFFERENCE IN DEPRECIATION AMOUNT DISPUTED BY A.O = RS. 21,94,750/ - (29,51,250 7,56,500) TAX AND SURCHARGE @ 30% = RS. 6,45,073/ - 3 SHRI MEHERNOSH R. CURRAWALA ITA NO. 6544/MUM/2013 THUS, HE SUBMITTED THAT NOW IN VIEW OF THE BOARDS CIRCULAR NO. 21/2015 DATED 10.12.2015 , THE APPEAL FILED BY THE REVENUE IS NOT MAINTAINABLE. 3. ON THE OTHER HAND, THE LD. DR SUBMITTED THAT THOUGH PRIMA FACIE IT APPEARS THAT TAX EFFECT IS LESS THAN RS. 10 LACS , HOWEVER, LIBERTY SHOULD BE GIVEN TO THE DEPARTMENT THAT IN CASE THE TAX EFFECT EXCEEDS RS. 10 LACS , TO FILE MISCELLANEOUS APPLICATION FOR RECTIFICATION OR RECALLING OF THE ORDER. 4. ON PERUS AL OF THE DISPUTED ISSUE BEFORE US, WE FIND THAT THE IMPUGNED ADDITION/DISALLOWANCE RELATES TO DEPRECIATION AND AFTER GIVING EFFECT TO THE LD. CIT(A) ORDER , THE AMOUNT DISPUTED BY THE DEPARTMENT IS RS.21,94,750/ - . ON SUCH A DISPUTED AMOUNT, ADMITTEDLY THE TAX EFFECT IS MUCH LESS THAN RS. 10 LACS. THUS, IN WAKE OF THE LATEST BOARD CIRCULAR (SUPRA), THE NEW MONETARY LIMIT FIXED IS RS. 10 LACS WHICH IS APPLICABLE ON THE PENDING APPEALS ALSO. ACCORDINGLY, THE APPEAL OF THE REVENUE IS TREATED AS DISMISSED AS NOT MAINTAINABLE. 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 5 TH MAY, 2016. S D / - S D / - ( B.R. BASKARAN ) ACCOUNTANT MEMBER (AMIT SHUKLA) JUDICIAL MEMBER MUMBAI, DATE : 5 TH MAY , 2016 4 SHRI MEHERNOSH R. CURRAWALA ITA NO. 6544/MUM/2013 COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, B BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI * S S L *