ACIT, Jaipur V. S.S. JAIN SUBODH SHIKSHA SAMITI, Jaipur

ITA 85/JPR/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99432 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 8 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 31-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: PRIYA SRIVASTAVA S LQU
• Keywords: Depreciation; Charitable institution; Capital expenditure
• Section: 32

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VH-VKJ-EHUK] YS[KK LNL; ,OA JH YFYR DQEKJ] U;KF; D LNL; DS LE{K BEFORE: SHRI T.R.MEENA, AM & SHRI LALIET KUMAR, JM VK;DJ VIHY LA-@ ITA NOS. 85 & 86/JP/2014 FU/KZKJ.K O'K Z@ ASSESSMENT YEARS : 2008-09 & 09-10 . THE ACIT, CIRCLE-5, JAIPUR. CUKE VS. M/S. S.S. JAIN SUBODH SHIKSHA SAMITI, SUBODH COLLEGE CAMPUS, RAMBAGH CIRCLE, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. AAATS 3402 L VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJENDRA SINGH, (JCIT) /KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI SIDDARTH RANKA & MS. PRIYA SRIVASTAVA (ADVOCATES) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 05.10.2015. ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 30/10/2015. VKNS'K@ ORDER PER SHRI LALIET KUMAR, J.M. THESE ARE TWO APPEALS FILED BY THE REVENUE AGAINST THE ORDER OF LD. CIT (A)- II, JAIPUR DATED 19.12.2013 FOR THE A.YS. 2008-09 & 09-10. THE COMMON SOLE GROUND RAISED IN THE APPEALS IS AS UNDER :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT (APPEALS) HAS ERRED IN :- 2 ITA NOS. 85 & 86/JP/2014 ACIT VS. S.S.JAIN SUBODH SHIKSHA SAMITI, JAIPUR. DIRECTING TO ALLOW DEPRECIATION ON THOSE ASSETS WHI CH WERE PURCHASED AS APPLICATION OF INCOME DESPITE THE FACT THAT ON T HOSE ASSETS 100% DEDUCTION HAS ALREADY BEEN CLAIMED BY THE ASSESSEE. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E SOCIETY SHRI S.S. JAIN SUBODH SHIKSHA SAMITI FORMED WITH THE SOLE OBJECTIVE OF ED UCATION. IT RUNS 18 INSTITUTIONS FOR IMPARTING EDUCATION. DURING THE YEAR UNDER CONSIDE RATION THE ASSESSEE HAS FILED REVISED INCOME-TAX RETURN SHOWING NIL INCOME ON 30. 09.2008 WHICH WAS PROCESSED U/S 143(1) OF THE IT ACT. ON EXAMINATION OF THE DETAILS OF DOCUMENTS FILED ALONG WITH THE RETURN, THE AO FOUND THAT THE ASSESSEE SOCIETY HAS CLAIMED DEPRECIATION OF RS. 1,59,87,909/- IN THE YEAR UNDER CONSIDERATION WHERE AS THE INVESTMENT IN THE ASSETS HAS ALREADY BEEN TAKEN AS APPLICATION OF FUNDS IN EARLI ER YEARS. THUS THE AO TREATED THAT THE ASSESSEE HAS CLAIMED DOUBLE DEDUCTION ON THE SAME A SSETS ONCE AT THE TIME OF INVESTMENT IN ASSETS AND AGAIN THROUGH DEPRECIATION ON THE SAME ASSETS. THEREFORE, THE AO HELD THAT THE DEPRECIATION CLAIMED BY THE ASSESS EE IS NOT ADMISSIBLE ON THOSE ASSETS AGAINST WHICH 100% DEDUCTION HAS ALREADY BEEN TAKEN BY THE ASSESSEE. THE AO PLACED RELIANCE ON THE HONBLE SUPREME COURT DECISION IN T HE CASE OF ESCORTS LTD. VS. UNION OF INDIA (1993) 199 ITR 43 WHEREIN IT IS HELD THAT WHE N DEDUCTION UNDER SECTION 35(2)(IV) WAS ALLOWED IN RESPECT OF CAPITAL EXPENDITURE ON SC IENTIFIC RESEARCH, NO DEPRECIATION WAS TO BE ALLOWED UNDER SECTION 32 ON THE SAME ASSETS. IN THE LIGHT OF ABOVE SUPREME COURT DECISION, THOUGH IN A DIFFERENT CONTEXT, THE AO REJECTED THE CLAIM OF THE ASSESSEE HOLDING THAT DEPRECIATION IS NOT ALLOWABLE AND MADE THE ADDITION OF RS. 1,59,87,909/- TO THE TOTAL INCOME OF THE ASSESSEE. SIMILAR IS THE C ASE FOR THE A.Y. 2009-10 AND THE A.O. 3 ITA NOS. 85 & 86/JP/2014 ACIT VS. S.S.JAIN SUBODH SHIKSHA SAMITI, JAIPUR. DISALLOWING THE DEPRECIATION MADE THE ADDITION OF R S. 1,82,74,910/- TO THE TOTAL INCOME OF THE ASSESSEE. 3. BEING AGGRIEVED, THE ASSESSEE FILED APPEALS BEFO RE LD. CIT (A), WHO HAS ALLOWED THE CLAIM OF THE ASSESSEE FOR BOTH THE ASSESSMENT Y EARS BY SEPARATE ORDERS BY OBSERVING AS UNDER :- 2.3. I HAVE CONSIDERED THE FACTS OF THE CASE; ASS ESSMENT ORDER AND APPELLANTS WRITTEN SUBMISSION. APPELLANT SUBMITTED THAT THIS ISSUE IS COVERED IN ITS FAVOUR BY THE ORDER OF ITAT IN APPEL LANTS OWN CASE IN EARLIER YEARS. I HAVE GONE THROUGH THE ORDER OF ITA T DATED 31.3.2008 IN APPELLANTS OWN CASE IN ITA NUMBER 250/JP/2007 FOR ASSESSMENT YEAR 2003-04 IN WHICH IT IS HELD THAT THE AMOUNT OF DEPR ECIATION DEBITED IN THE ACCOUNTS OF A CHARITABLE INSTITUTION HAS TO BE DEDU CTED TO ARRIVE AT THE INCOME AVAILABLE FOR APPLICATION OF CHARITABLE AND RELIGIOUS PURPOSES. THESE FINDINGS WERE FOLLOWED BY ITAT IN APPELLANTS OWN CASE IN ASSESSMENT YEAR 2005-06. RESPECTFULLY FOLLOWING THE DECISIONS OF ITAT IN APPELLANTS OWN CASE, THIS GROUND IS ALLOWED. 4. NOW THE REVENUE IS IN APPEAL BEFORE US FOR BOTH THE ASSESSMENT YEARS. 5. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY T HE DECISION OF THE TRIBUNAL FOR THE A.YS. 2003-04 AND 2005-06 IN THE ASSESSEES OWN CAS ES WHEREIN IT HAS BEEN HELD THAT THE AMOUNT OF DEPRECIATION DEBITED IN THE ACCOUNTS OF A CHARITABLE INSTITUTION HAS TO BE DEDUCTED TO ARRIVE AT THE INCOME AVAILABLE FOR APPL ICATION OF CHARITABLE AND RELIGIOUS PURPOSES. THEREFORE, RESPECTFULLY FOLLOWING THE EA RLIER DECISION OF THE TRIBUNAL IN THE ASSESSEES OWN CASE, WE ALLOW THE APPEALS OF THE AS SESSEE FOR BOTH THE YEARS. 4 ITA NOS. 85 & 86/JP/2014 ACIT VS. S.S.JAIN SUBODH SHIKSHA SAMITI, JAIPUR. 6. IN THE RESULT, REVENUES APPEALS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30/10/201 5. SD/- SD/- VH-VKJ-EHUK YFYR DQEKJ (T.R. MEENA) (LALIET KUMAR) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 30/10/2015 DAS/ VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE ACIT, CIRCLE-5, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- M/S. S.S. JAIN SUBODH SHIKSHA SAMITI SUBODH COLLEGE CAMPUS, JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 85 & 86/JP/2014) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR 5 ITA NOS. 85 & 86/JP/2014 ACIT VS. S.S.JAIN SUBODH SHIKSHA SAMITI, JAIPUR.