The ITO, Ward-1(1), Ahmedabad V. Accelaris Technologies Ltd., Ahmedabad

ITA 978/AHD/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5746 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 03-07-2017
• Assessment Year: 2006-2007
• Appeal Filed On: 07-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Assessee Lawyers: N B SHAH
• Keywords: Depreciation; Audit objection; Additional evidence; Tax effect

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./ ITA NO. 978/AHD/2014 / ASSESSMENT YEAR : 2006-07 ITO, WARD-1(1), AHMEDABAD VS ACCELARIS TECHNOLOGIES LTD., 405, MAURYA ATRIA, NR. KASTURI TOWER, BODAKDEV, AHMEDABAD PAN : AADCA 1940 M / (APPELLANT) / (RESPONDENT) REVENUE BY : SHRI V.K. SINGH, SR. DR ASSESSEE BY : SHRI N.B. SHAH, AR / DATE OF HEARING : 03/07/2017 / DATE OF PRONOUNCEMENT: 04/07/2017 / O R D E R PER MAHAVIR PRASAD, JUDICIAL MEMBER:- THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-6, AHMEDABAD D ATED 05.02.2014 FOR ASSESSMENT YEAR 2006-07. 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS IN ITS APPEAL:- 1. THE CIT(A) HAS ERRED IN LAW AND ON FACTS BY AD MITTING ADDITIONAL EVIDENCE DESPITE THE FACT THAT NONE OF THE EXCEPTIO N CLAUSES (A) TO (D) OF RULE 46A WERE FULFILLED AND HENCE THE ASSESSEE WAS NOT E LIGIBLE TO FILE FURTHER EVIDENCE ON THE ISSUES ALREADY RAISED DURING ASSESS MENT PROCEEDINGS. 2. THE CIT(A) HAS ERRED IN LAW AND ON FACTS BY DE LETING THE DISALLOWANCE OF DEPRECIATION OF RS. 7.70 LACS AND OTHER EXPENDITURE RELATED TO PORSCHE CAR NOT REGISTERED IN THE NAME OF THE ASSESSEE TILL THE END OF THE YEAR. THE SAME WAS PURCHASED DURING JANUARY 2006 AFTER WHICH NO BUSINE SS WAS CONDUCTED BY THE ASSESSEE AND THE ASSESSEE COULD NOT DEMONSTRATE ITS USAGE FOR THE PURPOSE OF BUSINESS. 3. THE CIT(A) HAS ERRED IN LAW AND ON FACTS BY DE LETING THE DISALLOWANCE OF RS.6.67 LACS ON ACCOUNT OF FORFEITURE OF RENT DEPOS IT DUE TO BREACH OF CONTRACT BY THE ASSESSEE AND WHICH WAS ALSO A CAPITAL EXPEND ITURE IN NATURE. 4. THE CIT(A) HAS ERRED IN LAW AND ON FACTS BY DE LETING THE DISALLOWANCE OF RENT OF RS.10 LACS OVERLOOKING THE FINDINGS IN THE ASSESSMENT ORDER WHEREIN IT WAS ESTABLISHED THAT THE PREMISES IN QUESTION WA S NOT AT ALL USED FOR THE PURPOSE OF BUSINESS BY THE ASSESSEE. ITA NO. 978/AHD/2014 ITO VS. ACCELARIS TECHNOLOGIES LTD AY : 2006-07 2 5. THE CIT(A) HAS ERRED IN LAW AND ON FACTS BY DE LETING THE DISALLOWANCE OF RS.7.11 LACS BEING CLAIM OF PROFESSIONAL FEES WITHO UT ANY EVIDENCE OF SERVICES RENDERED BY THE PAYEE. THE CIT(A) HAS NOT APPRECIAT ED THE FACT THAT THE ONUS OF ESTABLISHING THE PURPOSE OF PAYMENT WAS ON THE A SSESSEE WHICH WAS NOT DISCHARGED. 3. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUBM ITTED THAT THE PRESENT APPEAL OF THE REVENUE NEEDS TO BE DISMISSED ON ACCO UNT OF LOW TAX EFFECT IN VIEW OF THE CBDT CIRCULAR NO.21 OF 2015 DATED 10.12 .2015. THE LD. DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT TH E TAX EFFECT IS LESS THAN THE LIMIT PRESCRIBED BY THE AFORESAID CBDT CIRCULAR . 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT PRIMA-FACIE THIS APPEAL OF THE REVENUE IS NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR NO. 21/20 15 IN F.NO.279/MISC. 142/2007-ITJ (PT) DATED 10TH DECEMBER 2015, VIDE WH ICH IT HAS BEEN PROVIDED THAT IF THE TAX EFFECT BY VIRTUE OF THE CO MMISSIONER OF INCOME-TAX (APPEALS)S ORDER IS BELOW RS. 10 LACS, THEN THAT O RDER WOULD NOT BE CHALLENGED BEFORE THE TRIBUNAL IN FURTHER APPEAL. THE BOARD HAS PROVIDED EXEMPTIONS AT CLAUSE (8) OF THE INSTRUCTIONS WHEREI N IT HAS BEEN PROVIDED THAT THESE INSTRUCTIONS WILL NOT BE APPLICABLE, IF VIRES OF ANY PROVISIONS HAS BEEN QUASHED BY IMPUGNED ORDER OR ADDITION WAS MADE ON SOME AUDIT OBJECTIONS OR THE ADDITION RELATES TO UNDISCLOSED F OREIGN ASSETS/BANK ACCOUNTS, ETC. WE FIND THAT THE PRESENT CASE DOES NOT FALL WITHIN THE EXEMPTION CLAUSE AND THE TAX IS LESS THAN RS.10 LAC S. THEREFORE, THE PRESENT APPEAL IS NOT MAINTAINABLE AND HENCE DISMISSED. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE COURT ON 04 TH JULY, 2017 AT AHMEDABAD. SD/- SD/- AMARJIT SINGH (ACCOUNTANT MEMBER) MAHAVIR PRASAD (JUDICIAL MEMBER) AHMEDABAD; DATED 04/07/2017 **BT