M/s. Pentasoft Technologies Ltd., CHENNAI V. ITO (OSD), CHENNAI

MA 13/CHNY/2011

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 7368 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 21-12-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 18-11-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 07-02-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: PUSHYA SITARAMAN SR
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI [BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI ABRAHAM P GEORGE, ACCOUNTANT MEMBER] M.P.NOS.11 & 13/MDS/2011 [IN I .T.A NOS.1540/MDS/2006 AND 2148/MDS/2007] ASSESSMENT YEARS : 2002-03 AND 2003-04 M/S PENTASOFT TECHNOLOGIES LTD 25, IST MAIN ROAD UNIED INDIA COLONY KODAMBAKKAM CHENNAI 600 024 VS THE ITO (OSD) COMPANY CIRCLE V(2) CHENNAI (PETITIONER) (RESPONDENT) I .T.A NOS.1540/MDS/2006 AND 2148/MDS/2007 ASSESSMENT YEARS : 2002-03 AND 2003-04 THE ITO (OSD) COMPANY CIRCLE V(2) CHENNAI VS M/S PENTASOFT TECHNOLOGIES LTD 25, IST MAIN ROAD UNIED INDIA COLONY KODAMBAKKAM CHENNAI 600 024 (APPELLANT) (RESPONDENT) ASSESSEE BY : SMT.PUSHYA SITARAMAN, SR.COUNSEL DEPARTMENT BY : SHRI SHAJI P. JACOB DATE OF HEARING : 18-11-2011 DATE OF PRONOUNCEMENT : 21-12-2011 M.P 11 & 13/2011 ITA 1540/06 & 2148/07 :- 2 -: O R D E R PER HARI OM MARATHA, JUDICIAL MEMBER: WE ARE PROCEEDING TO DECIDE THE ABOVE MATTERS BY A COMMON ORDER. 2. BRIEFLY STATED, THE FACTS LEADING TO THE PRESENT PROCEEDING ARE THAT THE ASSESSEE-COMPANY NAMELY, M/S PENTASOFT TEC HNOLOGIES LTD., HAD FILED TWO WRIT PETITIONS WITH NOS. 20154 AND 20 155 OF 2011 UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA BEFORE THE HON'BLE HIGH COURT OF JUDICATURE AT MADRAS, PRAYING FOR ISSUE OF A WRI T OF CERTIORARI FOR GETTING THE ORDER DATED 18.3.2011 PASSED IN M.P.NOS .11 & 13/MDS/2011 IN I.T.A.NO.1540/MDS/2006 AND 2148/MDS/ 2007 QUASHED. LIKEWISE, WRIT PETITION NOS. 20156 AND 20 157 OF 2011 AIMED AT SEEKING ISSUE OF SIMILAR WRIT IN RESPECT OF ORD ER DATED 6.2.2008 PASSED IN I.T.A.NO. 1540/MDS/2006 AND ORDER DATED 2 4.3.2008 PASSED IN I.T.A.NO.2148/MDS/2007, QUASHED. THE HON'BLE HI GH COURT, WHILE DEALING WITH THESE WRIT PETITIONS, HAS OBSERVED IN PARA 5 OF ITS ORDER DATED 12.9.2011, AS UNDER: 5. IN VIEW OF THE ABOVE CIRCUMSTANCES, IT HAS TO BE HELD THAT AS PER THE JUDGMENT RELIED ON BY THE LEARNED SENIOR COUNSEL APPEARING FOR THE PETITIONER(CITED SUPRA), THE POWER OF RECTIFICATION OF CORRECTION OF A MISTAKE IS AVAI LABLE WITH THE TRIBUNAL AND THAT HAS BEEN FOLLOWED BY THE TRIBUNA L ALSO IN THE JUDGMENT CITED ABOVE. AS SUCH, THE ORDER OF TH E M.P 11 & 13/2011 ITA 1540/06 & 2148/07 :- 3 -: TRIBUNAL DATED 18.3.2011 CANNOT BE ALLOWED TO STAND . ACCORDINGLY, THE SAME IS SET ASIDE AND THE MATTER I S REMITTED BACK TO THE INCOME TAX APPELLATE TRIBUNAL TO EXAMIN E THE ISSUE AFRESH WITHIN A PERIOD OF TWELVE WEEKS FROM T HE DATE OF RECEIPT OF A COPY OF THIS ORDER. CONSEQUENTLY, W.P.NOS.20154 AND 20155 OF 2011 ARE ORDERED AS INDI CATED ABOVE. NO COSTS. CONSEQUENTLY, CONNECTED MISCELLA NEOUS PETITIONS ARE CLOSED. AS FAR AS W.P.NOS.20156 AND 20157 OF 2011 ARE CONCE RNED, IN VIEW OF THE ORDERS PASSED IN W.P.NOS.20154 AND 2 0155 OF 2011, THE MATTER IS REMITTED BACK TO THE FIRST RESP ONDENT SO AS TO RE-EXAMINE THE ISSUE AND TO PASS ORDERS. WIT H THIS OBSERVATION, W.P. NOS.20156 AND 20157 OF 2011 ARE DISPOSED OF. NO COSTS. CONSEQUENTLY, CONNECTED MISCELLANEOUS PETITIONS ARE CLOSED. 3. IT IS CLEAR FROM THE ABOVE THAT THE HON'BLE HIGH CO URT, IN WRIT PETITION NOS.20154 TO 20157 OF 2011, HAS REMITTED THE CASES BACK TO THE TRIBUNAL WITH A DIRECTION TO EXAMINE THE ISSUE AFRESH WITHIN A PERIOD OF TWELVE WEEKS FROM THE DATE OF RECEIPT OF COPY OF THE ORDER. IN FACT, M.P.NOS.11 & 13/MDS/2011 WERE DISPOSED OF VIDE ORDER DATED 18.3.2011 BY THE BENCH COMPRISING OF HARI OM MARATH A, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBE R, BUT THE APPEALS IN I.T.A.NO. 1540/MDS/2006 ALONGWITH I.T.A. NO. 1325/MDS/ 2006 VIDE ORDER DATED 6.2.2008 AND CONNECTING APPEA LS IN I.T.A.NO. 2148/MDS/2007 AND OTHERS WERE DISPOSED OF VIDE ORDE R DATED 24.3.2008 BY THE BENCH COMPRISING OF SHRI M.K.CHATU RVEDI, HON'BLE VP, AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. IN COMPL IANCE TO THE M.P 11 & 13/2011 ITA 1540/06 & 2148/07 :- 4 -: HIGH COURTS DIRECTIONS, THESE M.P NOS.11 & 13/MDS /2011 WERE HEARD ALONGWITH APPEALS IN I.T.A.NOS. 1540/MDS/2006 AND 2148/MDS/2007 ON THE IMPUGNED ISSUE. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE PERUSED THE ENTIRE MATERIAL AVAILABLE ON RECORD. WE HAVE F OUND THAT ORIGINALLY, THE ORDERS DATED 6.2.2008 AND 24.3.2008 WERE PASSED IN I.T.A.NOS. 1540/MDS/2006 AND 2148/MDS/2007, FOR ASSESSMENT YEA RS 2002-03 AND 2003-04, RESPECTIVELY, DISALLOWING THE DEPRECIA TION CLAIMED ON IPRS AND NON-COMPETE FEE. THE BENCH HAD TAKEN ITS VIEW BASED ON THE DECISION RENDERED IN THE CASE OF M/S A.B.MAURIA INDIA PVT. LTD VS ACIT, 08-TIOL-107-ITAT(MAD). ACCORDING TO THE SR. COUNSEL APPEARING FOR THE ASSESSEE, THIS CASE IS DISTINGUIS HABLE ON FACTS AS IN THAT CASE, THE ISSUE REGARDING ALLOWABILITY OF DEPR ECIATION ON NON- COMPETE FEE WAS NOT INVOLVED. IT WAS, ON THE CONTR ARY, SUBMITTED THAT THERE ARE OTHER DECISIONS OF THE CO-ORDINATE BENCHE S LIKE IN THE CASE OF ACIT VS M/S RADAAN MEDIA WORKS INDIA LTD IN I.T.A.N O. 2241/MDS/2006, ORDER DATED 14.12.2007; ACIT VS REAL IMAGE TECH (P) LTD. (2009) 120 TTJ (CHENNAI) 983, DATED 15.2.2008 AND ITO VS MEDICORP TECHNOLOGIES INDIA LTD, IN I.T.A.NO. 2328/ MDS/2007 DATED 16.1.2009, IN WHICH DEPRECIATION ON NON-COMPETE FEE HAS BEEN ALLOWED. IT WAS NOTICED THAT EARLIER, THE MISCELLA NEOUS PETITIONS WERE M.P 11 & 13/2011 ITA 1540/06 & 2148/07 :- 5 -: DECIDED AGAINST THE APPLICANT BECAUSE THE BENCH DEC IDING THE APPEALS WAS COMPRISED OF ENTIRELY DIFFERENT MEMBERS AND THE DECISIONS WHICH WERE RELIED ON BY THE SR. COUNSEL WERE NEVER PUT BE FORE THAT BENCH, AS PER THE RECORDS AND BECAUSE THESE DECISIONS HAVE NO T BEEN MENTIONED IN THE BODY OF THE ORDER, IT WAS DECIDED THAT THERE IS NO MISTAKE [AS MISTAKES APPARENT FROM RECORD] IN THE TRIBUNAL ORDE RS WHICH COULD BE RECTIFIED UNDER THE PROVISIONS OF SECTION 254(2) OF THE ACT. NOW, SINCE THE HON'BLE HIGH COURT HAS SET ASIDE THAT ORDERS AN D HAS GIVEN THE ABOVE EXTRACTED DIRECTION, WE HAVE TO DECIDE THE IS SUE ON MERITS INVOLVED IN THESE APPEALS. IT WAS NOTICED THAT THE DECISIONS ON WHICH THE SR. COUNSEL HAS RELIED, WERE RENDERED SUBSEQUEN TLY. THE DECISIONS ON WHICH RELIANCE HAS BEEN PLACED BEFORE THE HON'B LE HIGH COURT AS WELL AS BEFORE US AND WHICH WERE NOT CONSIDERED BY THE BENCH ARE AS UNDER: AGARWAL WAREHOUSING AND LEASING LTD. VS CIT, 257 ITR 235(M.P) SAIPEM S.P.A. VS DY. CIT 276 ITR (AT) 055(ITAT DEL ) DLF UNIVERSAL LTD VS CIT 306 ITR 271 (DEL) 5. THE ABOVE DECISIONS WERE NOT AVAILABLE BEFORE THE ASSESSING OFFICER AS WELL. WE ARE UNABLE TO ASCERTAIN AS TO WHETHER THE FACTS INVOLVED IN ALL THESE CASES ARE IDENTICAL OR DISTIN GUISHABLE. THEREFORE, M.P 11 & 13/2011 ITA 1540/06 & 2148/07 :- 6 -: WE DEEM IT FAIR AND JUSTIFIABLE TO REMIT BACK THE I SSUE INVOLVED IN THESE APPEALS TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION THAT HE WILL DECIDE THE IMPUGNED ISSUE AFRESH IN THE LIGHT OF TH E ABOVE MENTIONED DECISIONS AND OTHER RELEVANT DECISIONS WHICH ARE PU T BEFORE HIM BY THE PARTIES. ACCORDINGLY, WE ALLOW THE APPEALS FOR ST ATISTICAL PURPOSES. 6. IN VIEW OF OUR ABOVE DECISION, THE MISCELLANEOUS PETITIONS HAVE BECOME INFRUCTUOUS, HENCE DISMISSED. 7. TO SUMMARIZE THE RESULT, THE APPEALS STAND ALLOWE D FOR STATISTICAL PURPOSES WHEREAS THE MISCELLANEOUS PETI TIONS STAND DISMISSED BEING INFRUCTUOUS. ORDER PRONOUNCED IN THE OPEN COURT ON 21.12. 2011. SD/- SD/- (ABRAHAM P GEORGE) ACCOUNTANT MEMBER ( HARI OM MARATHA ) JUDICIAL MEMBER DATED: 21 ST DECEMBER, 2011 RD COPY TO: PETITIONER/RESPONDENT/CIT(A)/CIT/DR