Tristar Container Services (Asia) Private Limited, CHENNAI V. ACIT, CHENNAI

ITA 942/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7387 (ITAT-CHENNAI)
• Duration Of Justice: 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 23-02-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 12-04-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: V S JAYAKUMAR
• Keywords: Reopening of assessment; Capital asset; Depreciation; Revenue expenditure
• Section: 147

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , !.. # $%, ' () BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./ ITA NOS.937, 938, 939, 940, 941 & 942/MDS/2016 + ,+ / ASSESSMENT YEARS : 2007-08 TO 2012-13 M/S TRISTAR CONTAINER SERVICES (ASIA) PVT. LTD., NO.18, SWAMY SIVANANDA SALAI, CHEPAUK, CHENNAI - 600 005. PAN : AAACT 4043 K V. THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE III(1), CHENNAI - 600 034. (.// APPELLANT) (01.// RESPONDENT) ./ 2 3 / APPELLANT BY : SHRI V.S. JAYAKUMAR, ADVOCATE 01./ 2 3 / RESPONDENT BY : SHRI B. KOTESWARA RAO, CIT # 2 4' / DATE OF HEARING : 28.02.2017 56, 2 4' / DATE OF PRONOUNCEMENT : 29.03.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: ALL THE APPEALS OF THE ASSESSEE ARE DIRECTED AGA INST THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS) 11, CHENNAI, PERTAINING TO ASSESSMENT YEARS 2007-08 TO 2012-13. SINCE COMMON ISSUES ARISE FOR CONSIDERATION, WE HEA RD ALL THESE APPEALS TOGETHER AND DISPOSING OF THE SAME BY THIS COMMON ORDER. 2 I.T.A. NO.937 TO 942/MDS/16 2. THE FIRST ISSUE ARISES FOR CONSIDERATION IN ALL THE APPEALS IS WITH REGARD TO REOPENING OF ASSESSMENT. 3. DURING THE COURSE OF HEARING, THE LD.COUNSEL FOR THE ASSESSEE VERY FAIRLY SUBMITTED THAT HE IS NOT PRESS ING THIS GROUND. ACCORDINGLY, THE ISSUE RAISED BY THE ASSESSEE FOR R EOPENING OF ASSESSMENT UNDER SECTION 147 OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') IS DISMISSED AS NOT PRESSED. 4. THE ONLY OTHER ISSUE REMAINS TO BE ADJUDICATED I S IN RESPECT OF LEASE RENTALS. 5. SHRI V.S. JAYAKUMAR, THE LD.COUNSEL FOR THE ASSE SSEE, SUBMITTED THAT THE ASSESSEE HAS TAKEN CONTAINERS ON LEASE. IN THE BOOKS OF ACCOUNT, THE CONTAINERS WERE TAKEN AS ASSE TS. THE ASSESSEE ALSO CLAIMED DEPRECIATION ON THE CONTAINER S IN THE INCOME-TAX COMPUTATION. ACCORDING TO THE LD. COUNS EL, THE ASSESSEE ADDED BACK THE BOOK DEPRECIATION AND CLAIM ED CONTAINERS LEASE RENTAL AS REVENUE EXPENDITURE. HOWEVER, THE ASSESSING OFFICER DISALLOWED THE CLAIM OF THE ASSESSEE. THE ASSESSING OFFICER ALLOWED THE DEPRECIATION. ACCORDING TO THE LD. COU NSEL, THE ENTIRE AMOUNT HAS TO BE ALLOWED AS REVENUE EXPENDITURE. 3 I.T.A. NO.937 TO 942/MDS/16 6. ON THE CONTRARY, SHRI B. KOTESWARA RAO, THE LD. DEPARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASS ESSEE HAS TREATED THE CONTAINERS AS CAPITAL ASSET IN THE BOOK S. SINCE IT WAS TREATED AS CAPITAL ASSET, ACCORDING TO THE LD. D.R. , THE CIT(APPEALS) DISALLOWED THE CLAIM OF THE ASSESSEE TOWARDS PAYMEN T OF LEASE RENTAL, HOWEVER, HE ALLOWED THE DEPRECIATION AS CLA IMED. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE CLAIMS THAT THE CONTAINERS WERE TAKEN AS LEASE. A COPY OF THE AGREEMENT AVAILABLE AT PAPER-BOOK SHOWS THAT IT IS A LEASE-CUM- PURCHASE OF CONTAINERS. IT IS NOT CLEAR FROM THE A GREEMENT WHETHER IT IS A FINANCE LEASE OR OPERATING LEASE. THE FACT REMAINS THAT THE ASSESSEE TREATED THE CONTAINERS AS CAPITAL ASSET AN D ALTERNATIVELY CLAIMED DEPRECIATION ALSO. THE ALTERNATIVE CLAIM O F DEPRECIATION WAS ALLOWED BY THE ASSESSING OFFICER. THEREFORE, T HIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRMED. 8. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE S TAND DISMISSED. 4 I.T.A. NO.937 TO 942/MDS/16 ORDER PRONOUNCED ON 29 TH MARCH, 2017 AT CHENNAI. SD/- SD/- ( ! . . # $% ) ( . . . ) (D.S. SUNDER SINGH) (N.R.S. GANESAN) ' / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 8 /DATED, THE 29 TH MARCH, 2017. KRI. 2 04$9 :9,4 /COPY TO: 1. ./ /APPELLANT 2. 01./ /RESPONDENT 3. # ;4 () /CIT(A)-11, CHENNAI-34 4. PRC.CIT-3, CHENNAI 5. 9< 04 /DR 6. !+ = /GF.