Shri Ranjit Pratap, CHENNAI V. ACIT, CHENNAI

ITA 989/CHNY/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1170 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 13-03-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 07-05-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: R VIJAYARAGHAVAN
• Keywords: Depreciation
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ------- ITA NOS. 989/MDS/2012 ASSESSMENT YEAR : 2005-06 SHARI RANJUI PRATAP, NO. 3, RANJIT ROAD, KOTTUR, CHENNAI-600 085. V. THE ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-I(2), CHENNAI. (PAN : AAIPR4186J) (APPELLANT) (RESPONDENT) APPELLANT BY : SRI R. VIJAYARAGHAVAN, ADVOCATE RESPONDENT BY : SHRI GURU BASHYAM, JCIT DATE OF HEARING : 13.03.2013 DATE OF PRONOUNCEMENT : 18.03. 2013 O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(APPEALS)-VI, CHENNAI DATED 13-02-2012 FO R THE ASSESSMENT YEAR 2005-06. 2. BRIEF FACTS ARE THAT THE ASSESSEE HAD TAKEN ON LE ASE LAND ADMEASURING ABOUT 25,530 SQ.FT. FOR A PERIOD OF 10 YEARS. ON ITA NO.989/MDS/2012 : 2 : THE LEASED LAND THE ASSESSEE CONSTRUCTED A BUILDING AND THE SAME WAS GIVEN ON RENT AND THE RENTAL INCOME RECEIV ED BY THE ASSESSEE WAS OFFERED FOR TAXATION AT ` 23,10,085/- AND CLAIMED DEPRECIATION ON BUILDING AT ` 9,51,504/-. THE ASSESSING OFFICER DID NOT ALLOW DEPRECIATION ON THE GROUND THAT AS PE R SECTIONS 23 AND 24 OF THE INCOME TAX ACT, 1961 ('THE ACT' FO R SHORT) NO DEPRECIATION IS ALLOWABLE. 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(APPEALS). THE CIT(APPEALS) CONFIRMED THE ORDER PASSED BY THE ASSESSING OFFICER BY OBSERVING THAT THE ASSE SSEE BEING THE OWNER OF THE CONSTRUCTED SPACE OWNS IMMOVABLE P ROPERTY ALTHOUGH THE LAND ON WHICH THE SAID BUILDING IS LOC ATED IS NOT OWNED BY THE ASSESSEE. HOWEVER, THE STATUTORY ALL OWANCE TOWARDS REPAIRS HAS TO BE ALLOWED IF THE INCOME IS COMPUTED UNDER THE HEAD HOUSE PROPERTY. 4. ON BEING AGGRIEVED, THE ASSESSEE CARRIED THE MAT TER BEFORE THE TRIBUNAL. THE LEARNED COUNSEL FOR THE A SSESSEE SUBMITTED THAT THE ASSESSEE HAS CONSTRUCTED THE BUI LDING ON LEASED PREMISES. THE LEASE PERIOD IS 10 YEARS. ON CE THE LEASE PERIOD EXPIRES THE ENTIRE BUILDING WILL GO BACK TO THE LESSOR. THEREFORE, DEPRECIATION HAS TO BE ALLOWED. ITA NO.989/MDS/2012 : 3 : 5. ON THE OTHER HAND, THE LEARNED DR SUBMITTED THAT THE INCOME RECEIVED BY THE ASSESSEE IS UNDER THE HEAD INCOME FROM HOUSE PROPERTY AND ONLY STATUTORY DEDUCTION I S ALLOWABLE AS PER SEC. 24 OF THE ACT. 6. WE HAVE HEARD BOTH THE SIDES, PERUSED THE RECORD S AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE ONLY ISSUE FOR CONSIDERATION BEFORE US IS WHETHER THE AS SESSEE IS ELIGIBLE FOR THE DEPRECIATION CLAIMED BY HIM. IT I S AN ADMITTED FACT THAT THE ASSESSEE HAS TAKEN A PIECE OF LAND ON LEASE AND HE HAS CONSTRUCTED A BUILDING AND THE SAME WAS LET OUT TO THIRD PARTIES. EVEN THOUGH THE LAND WAS NOT BELONG ING TO THE ASSESSEE BUT SO FAR AS THE BUILDING IS CONCERNED, T HE ASSESSEE IS THE OWNER. THE ASSESSEE HAS NOT USED THE SAME B UILDING FOR HIS OWN PURPOSE. IT WAS GIVEN TO THIRD PARTIES ON RENT. THEREFORE, THE ASSESSEE IS NOT ENTITLED TO DEPRECIA TION AS CLAIMED BY HIM. WE FIND NO REASON TO INTERFERE WIT H THE ORDER PASSED BY THE CIT(APPEALS). ACCORDINGLY, THIS GROU ND OF APPEAL RAISED BY THE ASSESSEE IS DISMISSED. 7. THE GROUND RELATING TO RE-OPENING OF THE ASSESSM ENT U/S 147 OF THE ACT WAS NOT PRESSED. THEREFORE, THE SAM E IS DISMISSED AS NOT PRESSED. ITA NO.989/MDS/2012 : 4 : 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON MONDAY, THE 18 TH OF MARCH, 2013, AT CHENNAI. SD/- SD/- (ABRAHAM P. GEORGE) (V.DURGA RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER CHENNAI, DATED THE 18 TH MARCH, 2013. H. COPY TO: ASSESSEE/AO/CIT(A)/CIT/D.R./GUARD FILE