POWER EXCHANGE INDIA LTD, MUMBAI V. DY CIT-14(2)(2), MUMBAI

ITA 769/MUM/2021

• Counselvise Citation: [NaN] 107 COUNSELVISE.COM (IT) 1693 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 11-05-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation
• Section: 143(3); 142(1); 143(1); 250; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, MUMBAI BEFORE SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER & SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA No. 769/Mum/2021 (A.Y: 2013-14) Power Exchange India Ltd., 9 th Floor, 901, Sumer Plaza, Marol Maroshi Road, Andheri East, Mumbai – 400059. Vs. DCIT – 14(2)(2) 4 th Floor, Aayakar Bhavan, MK Road Mumbai – 400020. ./ज आइआर ./PAN/GIR No. : AAECP6452C Appellant .. Respondent Appellant by : Mr. Sunil Nahta.AR Respondent by : Mr. S.G. Menon. Sr. DR Date of Hearing 09.02.2022 Date of Pronouncement 14.02.2022 आद श / O R D E R PER PAVAN KUMAR GADALE JM: The assessee has filed the appeal against the order of the CIT(A)-National Faceless Appeal Centre(NFAC) Delhi passed u/s 143(3) and 250 of the Act. The assessee has raised the following grounds of appeal: 1.(a) On f acts and circu mstances of the c ase, the impugned order p assed b y th e Commissioner of Income T ax (Appe al s) [Ld. C IT (A)] dismissing the ap peal electronic ally fil ed by the ITA No. 769/Mum/2021 Power Exchange India Ltd, Mumbai. - 2 - ap pellan t agains t order under sec tion 143(3) of the Income T ax Ac t, 1961 ("the Act") in limine as not main tain able on th e ground th at appe al h ad not been f il ed electronic al ly with in time and no condonation of delay in f iling of appe al was f iled, is illegal and bad in l aw. (b) On f acts and circ umstan ces of the c ase, the Id. CIT (A) erred on f ac ts an d in law in no t tre atin g th e electronic f ilin g of ap pe al with in time considering th at the appellan t havin g f iled the paper appeal on 4 t h Apr il 2016 within 30 days time limit an d thereaf ter also electronic f iled appe al on 1 3 th April, 2016 with in th e ex tended time limit win d ow provided as per Circular No. 20/2016 dated 26 .05.2016. (c) On the f acts an d in th e circums tan ces of the c ase an d in law, the Ld C IT (A) erred in dismissing the appeal without givin g an adequ ate oppor tunity of bein g heard and as such doing so is wrong and contr ar y to th e p rovisions of th e Ac t and Rules and Regulation s made thereunder. (d) The ord er passed by the Id. C IT (A) on this tech nic al ground may be se t asid e and he may be direc ted to con sid er th e ap pe al and issu es on merits. Withou t prejudice to above ground of appe al, 2. On the f ac ts an d in the circumstan ces of the c ase and in law, the Ld. C IT(A) f ailed to appr eciate th at the Ld. AO erred in restr ic ting the cl aim of Compu ter Sof tware, Compu ter Auto mation, IT Consultan cy Char ges and Compu ter T radin g Applic ation and Compu ter Systems f orming par t of the block of asse ts of "Compu te r includin g compu ter sof tware" at the r ate of 60% as cl aimed b y th e appellan t an d th ereb y erred in disall owing depreciation all owance of Ps. 28,1 1,51 8/- as claimed by th e appellan t u /s 32(1) of th e Income T ax Ac t, 1961 and th e reason s assigned f or doin g so are wrong an d con trar y to the provision s of th e in come tax ac t and the rules made there under. 3. On th e f ac ts and in the c ircu ms tance s o f the case and in law, the ld. CIT (A) fail ed to apprec iate th at the Ld. AO erred in ini tiatin g pen al ty proceed ings u /s 271(1 )(c) of the Ac t in ITA No. 769/Mum/2021 Power Exchange India Ltd, Mumbai. - 3 - respect of depreciation allo wance of Rs. 28,11 ,518 /- and reasons assign ed by him are wron g an d contr ar y to the f acts of th e c ase, provisions of Income T ax Ac t, 1961 and the rules made thereunder. 2. The brief facts of the case are that the assessee company is engaged in the business of facilitating trading in power, innovative and credible solutions to transforms the power markets. The assessee has filed the return of income for the A.Y 2013-14 on 28.09.2013 disclosing a total income(Loss)of Rs. 7,93,33,180/- and the return of income was processed u/s 143(1) of the Act. Subsequently, the case was selected for scrutiny and notice u/s 143(2) and 142(1) of the Act was issued. In compliance, the Ld.AR of the assessee has filed the details of return of income, copy of annual report and tax audit report and the case was discussed. The A.O on verification of the financial statements find that the assessee has revenue from operations of Rs. 7,60,64,677/- and the assessee has claimed the depreciation @ 60% on computer software, computer automation, computer trading and computer systems, and IT consultancy charges. Whereas the A.O has called for explanations on claim of depreciation and the assessee has filed ITA No. 769/Mum/2021 Power Exchange India Ltd, Mumbai. - 4 - the details on 16.02.2015 referred at Para 6.2 of the assessment order. But the claim was not be accepted, whereas in the assessment year 2011-12 & 2012-13 the assessee has accepted that the facts that the assessee has procured and installed various computer software and claimed depreciation @60% but it was restricted under the provisions of Sec. 32(1)(ii) of the Act, were the expenditure incurred on acquiring the license is eligible for depreciation @25%. The A.O. has relied on earlier years findings and restricted the depreciation @ 25% on intangible assets and Rs. 28,11,518/- claimed as excess depreciation is disallowed and assessed the total income (Loss) of Rs. 7,99,33,180/- and passed the order u/s 143(3) of the Act dated 27.02.2016. 3. Aggrieved by the order, the assessee has filed an appeal before the CIT(A). Whereas, the CIT(A) has considered the grounds of appeal and find that there is a delay in filing the appeal by 4 days as the assessee has filed the Form-35 on 13.04.2016. The CIT(A) without going into the merits of the appeal has observed that the assessee has not explained the ITA No. 769/Mum/2021 Power Exchange India Ltd, Mumbai. - 5 - delay refereed at page 3 Para 4.2 of the order and dismissed the assessee appeal in limine. 4 .2. From th e above,it is cle ar th at proper eviden ce along with jus tif ic ation should be given f or such a delay if the appeal is f iled af ter 30 days time per iod. Here the impugned order was passed on 27.02.2016 an d the appellan t claims to h ave received on 08.03 .2016 and the appe al was f iled on 13.04.2016 i.e. af te r 4 days f rom the d ate of service of order and no reason whatsoever h as been rendered by th e appellan t f or such a delay n or an y application for condonation h as been f iled . However , th e appellan t f iled submission in respec t of notice under section 2 50 of the Income T ax Ac t, 1961, but no condonation le tter was f iled in respec t of d elay in f il ing of appe al. In absence of an y application from th e appel lan t regar din g cond onation of d elay, I do not f ind an y re ason to cond one the delay in f iling appeal . Th eref ore the appeal deserves to be dismissed in l imine. Aggrieved by the order of the ld. CIT(A), the assessee has filed an appeal before the Hon’ble Tribunal. 4. At the time of hearing, the ld. AR of the assessee submitted that the CIT(A) has dismissed the assessee’s appeal, because the assessee has not filed as per the procedure laid down under Rule 45 & 46 of Income Tax Rules, 1962. Whereas, the assessee has filed the appeal manually on 04.04.2016 and again electronically on 13-04-2016 within the extended ITA No. 769/Mum/2021 Power Exchange India Ltd, Mumbai. - 6 - period as per CBDT circular no.20/2016.The amendment in filling the appeal is w.e.f 1-3-2016 and due to technical glitches the appeal was filed electronically subsequently. The ld.AR prayed that the assessee be provided an opportunity to substantiate the case with evidences on merits and prayed for allowing the appeal. Contra, the Ld.DR supported the order of the CIT(A). 5. We have heard the rival submissions and perused the material available on record. The sole crux of the disputed issue that the assessee has filed the appeal in paper form on 4.04.2016. Further, we find that as per the amendment and procedure laid down under Rule 45 & 46 of the Income Tax Rules, 1962 w.e.f. 01.03.2016. The appeal in Form No. 35 has to be filed electronically, whereas the assessee has filed the appeal in electronic form on 13-4-2016 due to technicalities/glitches in filing the appeal electronically. Further the assessee was not provided an opportunity to file the explanations on delay. ITA No. 769/Mum/2021 Power Exchange India Ltd, Mumbai. - 7 - 6. We have considered the facts of technicalities in filing the appeal electronically and the amendment effective from 01.03.2016. Accordingly, to meet the ends of justice, we set aside the order of the CIT(A) and restore the disputed issue to the file of the CIT(A) to adjudicate afresh on merits and the assessee should be provided adequate opportunity of hearing and shall cooperate in submitting the information and comply with appeal filling Rules for early disposal of appeal and allow the grounds of appeal of the assessee for statistical purposes. 7. In the result, the appeal filed by the assessee is treated as allowed for statistical purposes. Order pronounced in the open court on 14.02.2022. Sd/- Sd/- (OM PRAKASH KANT) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated 14.02.2022 KRK, PS /Copy of the Order forwarded to : 1. / The Appellant ITA No. 769/Mum/2021 Power Exchange India Ltd, Mumbai. - 8 - 2. / The Respondent. 3. आ र आ / The CIT(A) 4. आ र आ ( ) / Concerned CIT 5. "#$ % & &' , आ र ) र*, हमद द / DR, ITAT, Mumbai 6. % -. / 0 / Guard file. ान ु सार/ BY ORDER, " & //True Copy// 1. ( Asst. Registrar) ITAT, Mumbai