DCIT, Circle - 4, Kolkata, Kolkata V. M/s. Maple Circuits Limited, Kolkata

ITA 825/KOL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9418 (ITAT-KOLKATA)
• Duration Of Justice: 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2011
• Appeal Filed By: Department
• Bench Allotted: A
• Next Hearing Date: 30-08-2010
• Assessment Year: 2002-2003
• Appeal Filed On: 26-04-2010
• Court: TRIBUNAL
• Department Lawyers: B R PURAKAYASTHA
• Assessee Lawyers: D S DAMLE
• Keywords: Depreciation

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BEN CH A, KOLKATA () BEFORE . . . . . . . . , ,, , SHRI D.K.TYAGI, JUDICIAL MEMBER. !' !' !' !' /AND . .. . . .. .! !! ! , # SHRI C.D. RAO, ACCOUNTANT MEMBER '$ '$ '$ '$ / ITA NO. 825/KOL/2010 %&' !()/ ASST. YEAR : 2002-03 (+, / APPELLANT ) D.C.I.T., CIRCLE-4, KOL. - !& - - VERSUS - (.+,/ RESPONDENT ) M/S. MAPLE CIRCUITS LTD., KOLKATA (PAN: ALRPS 8760P) +, / 0 / FOR THE APPELLANT: / SHRI B.R.PURAKAYASTHA .+, / 0 / FOR THE RESPONDENT : / SHRI D.S.DAMLE 1 / ORDER ( . .. . . .. .! !! ! ) # PER SHRI C.D.RAO, A.M . THIS APPEAL FILED BY THE REVENUE IS PREFERRED AGAIN ST THE ORDER DATED 24.08.2009 OF THE C.I.T.(A)-IV, KOLKATA PERTAINING TO ASSESSME NT YEAR 2002-03. 2. IN THIS APPEAL, THE REVENUE HAS TAKEN THE FOLLO WING GROUNDS: 1. THAT LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON F ACTS, IN ALLOWING THE CLAIM OF EXPENSES AMOUNTING TO RS.1,27,000/- WITHOU T CONSIDERING THAT SUCH EXPENSES ARE NOT ADMISSIBLE AS THE ASSESSEE CO MPANY STOPPED FUNCTIONING SINCE 01.04.1990. 2. THAT LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACTS, IN ALLOWING THE CLAIM OF DEPRECIATION AMOUNTING TO RS.12,98,466/- W ITHOUT CONSIDERING THAT SUCH DEPRECIATION IS NOT ADMISSIBLE AS NO PLAN T & MACHINERY WAS PUT TO USE SINCE 01.04.1990 WHEN THE ASSESSEE COMPANY S TOPPED FUNCTIONING. 3. THAT THE APPELLANT CRAVES FOR LEAVE TO ADD, DE LETE OR MODIFY ANY OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. 2 3. AT THE TIME OF HEARING, THE LD. COUNSEL, APPEARI NG ON BEHALF OF THE ASSESSEE, SUBMITTED THAT BOTH THE ABOVE ISSUES ARE COVERED IN FAVOUR OF THE ASSESSEE IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEARS 1991-92, 1992-93 AND 1995-96 AND AS WELL AS IN THE CASE OF NORPLEX OAK INDIA LTD. FOR THE ASSESSMENT Y EARS 1992-93 IN ITA NO.2637/CAL/1995 AND 2004-05 IN ITA NO.2526/KOL/200 7 AND FILED THE COPIES OF THE SAME. HOWEVER, THE LD. D.R., THOUGH DID NOT CONTRAD ICT THE ABOVE SUBMISSIONS OF THE LD. COUNSEL, HAS POINTED OUT THAT THE QUANTUM OF DE PRECIATION CLAIMED BY THE ASSESSEE DURING THE ASSESSMENT YEAR IS MUCH MORE THAN THE ON E WHICH HAS BEEN DECIDED BY THE TRIBUNAL IN THE IMMEDIATELY PRECEDING ASSESSMENT YE ARS, WHICH IS APPARENT FROM THE ORDERS OF THE TRIBUNAL. THEREFORE, THIS REQUIRES FR ESH VERIFICATION AS TO HOW THE COMPUTATION OF THE DEPRECIATION HAS BEEN ENHANCED. THEREFORE, HE REQUESTED TO SET ASIDE THE MATTER TO THE FILE OF THE AO TO VERIFY TH E SAME. 4. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CAREF UL PERUSAL OF THE MATERIALS AVAILABLE ON RECORD, AS REGARDING THE GROUND NO.1 O N ACCOUNT OF DISALLOWANCE OF EXPENSES OF RS.1,27,000/-, WE FIND THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE HONBLE JURISDICTIONAL HIGH COURT I N THE CASE OF CIT-VS- NEW SEWAN SUGAR AND GUR REFINING COMPANY REPORTED IN 185 ITR 564 WHEREIN IT WAS HELD THAT THE LEASE RENT CLAIMED AND THE REMUNERATION PAID FOR SE CRETARIATE WORK AND LIAISON WORK ARE REASONABLE ON THE FACTS OF THE CASE AND IT WAS WHOL LY AND EXCLUSIVELY LAID OUT FOR THE SURVIVAL OF THE COMPANY. THEREFORE, WE FIND NO INFI RMITY IN THE ORDERS OF THE LD. CIT(A). THUS, THE GROUND NO.1 OF THE REVENUE IS DIS MISSED. 4.1 AS REGARDING GROUND NO.2 RELATING TO DEPRECIATI ON, THERE IS NO DISPUTE THAT THIS ISSUE IS COVERED BY THE ORDER OF THE ITAT IN ASSESS EES OWN CASE FOR THE ASSESSMENT YEARS 1991-92, 1992-93 AND 1994-95 AND IN THE CASE OF NORPLEX OAK INDIA LTD.. HOWEVER, AS POINTED OUT BY THE LD. D.R., THE QUANTU M OF DEPRECIATION CLAIMED DURING THE ASSESSMENT YEAR VARIES ON HIGHER SIDE AND IF TH E ACTIVITIES OF THE COMPANY ARE STOPPED FUNCTIONING, THE REASON FOR ENHANCEMENT OF THE DEPRECIATION WAS NOT AVAILABLE 3 ON RECORD. THEREFORE, WE SET ASIDE THE MATTER TO TH E FILE OF THE AO TO VERIFY THE SAME AND ALLOW AS PER THE ORDER OF THE TRIBUNAL. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLO WED IN PART FOR STATISTICAL PURPOSES. 2 1 3 4& 25 ORDER IS PRONOUNCED IN THE OPEN COURT ON 07/01/2011 . SD/- SD/- . . . . . . . . , ,, , D.K.TYAGI, JUDICIAL MEMBER . .. . . .. .! !! ! , # C.D. RAO, ACCOUNTANT MEMBER ( (( (# # # #) )) ) DATE: 07.01.2011 MST(SR.P.S.) 1 / .%%6 76(8- COPY OF THE ORDER FORWARDED TO: 1. M/S. MAPLE CIRCUITS LTD., 31, N.S. ROAD, KOLKATA 700 071. 2 D.C.I.T., CIRCLE-4, KOLKATA 3. THE CIT, 4. THE CIT(A), 5. DR, KOLKATA BENCHES, KOLKATA 6 .%/ TRUE COPY, 1&4/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES