THE ACIT CC-37, V. M/S. MIRC ELECTONICS LTD.,

ITA 9579/MUM/2004

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8064 (ITAT-MUMBAI)
• Duration Of Justice: 9 year(s) 8 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2014
• Appeal Filed By: Department
• Bench Allotted: A
• Next Hearing Date: 08-09-2014
• Assessment Year: 2001-2002
• Appeal Filed On: 29-12-2004
• Court: TRIBUNAL
• Department Lawyers: JEEVAN LAL LAVADIYA
• Assessee Lawyers: PRIYESH VIRA
• Keywords: Depreciation

Judgement Text

, , , , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A, MUMBAI , ! , ' BEFORE SHRI JOGINDER SINGH, JM AND SHRI RAJENDRA, A M ITA NO.9579/MUM/2004 (A.Y.2001-02) ACIT, CC-37 ROOM NO.11 GROUND FLOOR, AAYAKAR BHAVAN MUMBAI-400 020. # # # # / VS. M/S. MIRC ELECTRONICS G-1, MIDC, ONIDA HOUSE MAHAKALI CAVES ROAD ANDHERI (E) MUMBAI-400 093. ( %& / // / APPELLANT) ( '(%& / RESPONDENT) ITA NO.3193/MUM/2008 (A.Y.2004-05) M/S. MIRC ELECTRONICS G-1, MIDC, ONIDA HOUSE MAHAKALI CAVES ROAD ANDHERI (E) MUMBAI-400 093. # # # # / VS. ACIT, CC-37 ROOM NO.11 GROUND FLOOR, AAYAKAR BHAVAN MUMBAI-400 020. ( %& / // / APPELLANT) ( '(%& / RESPONDENT) %& ) * ) * ) * ) * /REVENUE BY : SHRI JEEVANLAL LAVADIYA '(%& ) * ) * ) * ) * /ASSESSEE BY : SHRI PRIYESH VIRA # ) +, / / / / DATE OF HEARING : 11.09.2014 -./ ) +, / DATE OF PRONOUNCEMENT : 11.09.2014 0 0 0 0 / / / / O R D E R PER JOGINDER SINGH (JM)/ : IN BOTH THESE APPEALS THE LIMITED ADJUDICATION PERT AINS TO DISALLOWANCE OF ASSESSEES CLAIM IS ON ACCOUNT OF D EPRECIATION ON THE ASSET OF VASAI UNIT. DURING HEARING BOTH THESE APPEA LS ON THE IMPUGNED ITA NO.9579/MUM/2004 & 3193/M/08 (A.Y. 01-02)& (04-05) 2 ISSUE, THE LD. COUNSEL FOR THE ASSESSEE SHRI PRIYES H VIRA CONTENDED THAT THE ISSUE HAS ALREADY BEEN SETTLED BY THE TRIBUNAL VIDE ORDER DATED 16.11.2011 (MA NO.205/MUM/2011) .THIS FACTUAL MATRI X WAS CONSENTED TO BE CORRECT BY THE LD. DR SHRI JEEVANLAL LAVADIYA . THE RELEVANT PORTION OF THE AFORESAID ORDER IS REPRODUCED HEREUNDER :- 5. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RIVAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE FACTS ARE NOT IN DISPUTE INASMUCH AS IT IS ALSO NOT IN DISPUTE THAT ON THE PLANT & MACHINERY T HE DEPRECIATION WAS ALLOWED TO THE ASSESSEE IN PRECEDI NG YEARS AS WELL AS IN SUCCEEDING YEARS. IT WAS DISALLOWED B Y THE AO, CIT(A) AND THE TRIBUNAL ON THE GROUND THAT DURING T HE YEAR UNDER CONSIDERATION THE PLANT & MACHINERY WERE NOT PUT TO USED AND FOR THIS PURPOSE THE TRIBUNAL HAS RELIED O N THE DECISION OF THE HONBLE JURISDICTION HIGH COURT IN THE CASE OF DINESH KUMAR GULABCHAND AGARWAL (SUPRA). WE FURTHE R FIND THAT AT THE TIME OF HEARING OF THE APPEAL, IN THE REJOINDER, IT WAS STATED BY THE LD. COUNSEL FOR THE ASSESSEE THAT THE SAID DECISION IS NOT APPLICABLE AS IN THAT CASE THE MACHINERY WAS NOT PUT TO USE AND FOR THIS REASON TH E DEPRECIATION WAS NOT ALLOWED, WHEREAS IN THE ASSESS EES CASE, THE MACHINERY WAS USED IN EARLIER YEARS AND O N ACCOUNT OF DISPUTE IT COULD NOT BE USED FOR THE YEA R UNDER CONSIDERATION AND, THEREFORE, THE SAID DECISION IS DISTINGUISHABLE AND NOT APPLICABLE TO THE FACTS OF THE ASSESSEES CASE. HOWEVER, WE FIND THAT THE TRIBUNAL , WHILE APPLYING THE RATIO OF THE DECISION IN THE CASE OF D INESH KUMAR GULABCHAND AGARWAL (SUPRA), HAS NOT CONSIDERE D THE SAID DISTINGUISHING FEATURE AND HAS APPLIED THE SAI D DECISION AGAINST THE ASSESSEE. WE FURTHER FIND THAT IN THE SUBSEQUENT DECISION THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF G.R. SHIPPING LTD. (SUPRA), HAS ALLO WED THE DEPRECIATION FOLLOWING THE DECISION IN THE CASE OF WHITTLE ANDERSON LTD. VS. CIT (79 ITR 613) (BOM.) AND IN TH E CASE OF CIT VS. G.N. AGARWAL (INDIVIDUAL) (217 ITR 250 )(BO M.). SINCE THE TRIBUNAL WHILE APPLYING THE DECISION IN T HE CASE OF DINESH KUMAR GULABCHAND AGARWAL (SUPRA) HAS NOT CONSIDERED THE DISTINGUISHING FEATURE POINTED OUT B Y THE LD. COUNSEL FOR THE ASSESSEE IN PARA 12 OF ITS ORDER, T HEREFORE, THERE IN AN APPARENT MISTAKE IN THE ORDER OF THE TR IBUNAL IN TERMS OF SEC.254(2) OF THE ACT. THIS BEING SO AND K EEPING IN VIEW THAT THE MATTER REQUIRES PROPER APPRECIATION O F FACTS AND LAW, THEREFORE, IN THE INTEREST OF JUSTICE, WE ARE OF THE ITA NO.9579/MUM/2004 & 3193/M/08 (A.Y. 01-02)& (04-05) 3 VIEW THAT THE ORDER PASSED BY THE TRIBUNAL ON THE I SSUE OF DEPRECIATION MAY BE RECALLED AND ACCORDINGLY WE REC ALL THE ORDER DATED 25.09.2007 FOR THE LIMITED PURPOSE TO RECONSIDER THE ISSUE OF DEPRECIATION AFRESH AND ACC ORDING TO LAW. THE MISC. APPLICATION FILED BY THE ASSESSEE IS , THEREFORE, PARTLY ALLOWED. THE REGISTRY IS DIRECTED TO FIX THE DATE OF HEARING ON 16-01-2012. 2. WE HAVE CONSIDERED THE SUBMISSIONS PUT FORTH BY THE LD. RESPECTIVE COUNSEL AND PERUSE THE MATERIAL AVAILABL E ON RECORD. THE TRIBUNAL IN THE AFORESAID ORDER HAS RECORDED A FACT UAL FINDING THAT IN PRECEDING AND SUCCEEDING YEARS DEPRECIATION WAS ALL OWED TO THE ASSESSEE ON THE PLANT & MACHINERY AND SUCH MACHINER Y COULD NOT BE PUT TO USE FOR THE YEAR UNDER CONSIDERATION ON ACCO UNT OF DISPUTE, BUT FACT REMAINS FOR EARLIER YEAR THE MACHINERY WAS USE D. THE TRIBUNAL PLACED RELIANCE UPON THE DECISION FROM HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF G.R. SHIPPING (INCOME TAX APPEAL NO.598/M/09 DATED 28/7/09) WHEREIN ALLOWED THE DEPRECIATION ON THE BARGE THOU GH IT WAS NOT USED FOR A SINGLE DAY. THE BENCH HAS ALREADY DI SCUSSED THE CASE WHITTLE ANDERSON LTD. VS. CIT (79 ITR 613)(BOM) AND C IT VS. G.N. AGARWAL (INDIVIDUAL) 217 ITR 250(BOM.) . THE HONBLE CALCUTTA HIGH COURT IN CIT VS. NORPLEX OAK INDIA (2011) 198 TAXMANN 470 WHEREIN DUE TO ADVERSE SITUATION IN THE STATE THE MACHINE COULD NOT BE USE D, IT WAS HELD THAT THE ASSESSEE IS ENTITLED TO GET THE BENEFIT OF SECT ION 32. IDENTICAL RATIO WAS LAID DOWN IN CIT VS. INTERNATIONAL CREATIVE FOODS PVT. LTD. 199 TAXMANN 273 (KER.) , CIT VS. INDIA TEA & TIMBER TRADING COMPANY (221 ITA NO.9579/MUM/2004 & 3193/M/08 (A.Y. 01-02)& (04-05) 4 ITR 857) (GAU.), CIT VS. NAHAR EXPORTS LTD. (163 TA XMANN 5180)(P&H) AND CIT VS. BLEND WELL BOTTLES (P) 323 ITR 18 (KAR.) . IN VIEW OF THIS FACTUAL AND LEGAL POSITION TO THIS LIMITED EXTENT O NLY THE GROUND RAISED BY THE ASSESSEE IS ALLOWED IN BOTH THE YEARS. 3. IN THE RESULT THE IMPUGNED GROUND, SO RAISED, IN THE APPEALS IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION O F THE HEARING ON 11 TH DAY OF SEPTEMBER, 2014 . 0 ) -./ 1 #2 11.09.2014 . ) 9 SD/- SD/- (RAJENDRA) (JOGINDER SINGH) ! ! ! ! / ACCOUNTANT MEMBER ! ! ! ! / JUDICIAL MEMBER MUMBAI; 1 # DATED : 11 TH SEPT. 2014. JV. 0 ) '+: ;:/+ 0 ) '+: ;:/+ 0 ) '+: ;:/+ 0 ) '+: ;:/+/ COPY OF THE ORDER FORWARDED TO : 1. %& / THE APPELLANT 2. '(%& / THE RESPONDENT. 3. < ( ) / THE CIT, MUMBAI. 4. < / CIT(A)-13, MUMBAI 5. :?9 '+# , , / DR, ITAT, MUMBAI 6. 9@ A / GUARD FILE. 0# 0# 0# 0# / BY ORDER, (:+ '+ //TRUE COPY// B BB B/ // /C C C C (DY./ASSTT. REGISTRAR) , , , , / ITAT, MUMBAI