FGP LTD., V. JT. CIT. (OSD)-1(1),

MA 210/MUM/2011

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 6983 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 14-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2003-2004
• Appeal Filed On: 31-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K NAIK
• Assessee Lawyers: A V SONDE
• Keywords: Business income; Depreciation; Unabsorbed depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES F, MUMBAI BEFORE SHRI R.V. EASWAR (PRESIDENT) AND SHRI RAJENDRA SINGH (J.M.) M.A. NO.210/MUM/2011 (ARISING OUT OF ITA NO.2653/MUM/2007) ASSESSMENT YEAR : 2003-2004 M/S. FGP LIMITED COMMERCIAL UNION HOUSE, 9, WALLACE STREET, FORT, MUMBAI 400 001. PAN : AAACF1671M VS. THE J.C.I.T. (OSD) 1(1) AAYAKAR BHAVAN, M.K. MARG, MUMBAI 400 020. (APPLICANT) (RESPONDENT) APPLICANT BY : SHRI A.V. SONDE RESPONDENT BY : SHRI A.K. NAIK DATE OF HEARING : 09.09.2011 DATE OF PRONOUNCEMENT : 14.09.2011 O R D E R PEP RAJENDRA SINGH, A.M. THIS MISCELLANEOUS APPLICATION HAS BEEN FILED BY TH E ASSESSEE REQUESTING FOR AMENDMENT OF ORDER DATED 15.12.2010 OF THE TRIBUNAL IN ITA NO.2653/M/2007 AS ONE OF THE GROUNDS RAISED BY THE ASSESSEE WAS OMITTED TO BE ADJUDICATED BY THE TRIBUNAL. 2. WE HAVE HEARD BOTH THE PARTIES IN THE MATER. TH E LEARNED AR FOR THE ASSESSEE SUBMITTED THAT ASSESSEE HAD RAISED THE GRO UND REGARDING SET OFF OF BROUGHT FORWARD UNABSORBED DEPRECIATION AGAINST INC OME FROM OTHER SOURCES OR CAPITAL GAIN WHICH WAS DULY NOTED BY THE TRIBUNAL IN PARA 2.10.2 OF THE ORDER BUT THE SAME WAS OMITTED TO BE ADJUDIC ATED. ON PERUSAL OF RECORDS, WE FIND THAT THE GROUND WAS, IN-DEED, OMIT TED TO BE ADJUDICATED. THE ISSUE RAISED IN THE GROUND IS HOWEVER COVERED B Y THE DECISION OF THE SPECIAL BENCH IN THE CASE OF D.C.I.T. VS. TIMES GUA RANTY LTD. (2010) 4 ITR M.A. NO.210/MUM/2011 2 210 (MUM.) (TRIB.) (SB), IN WHICH IT HAS BEEN HELD THAT CARRY FORWARD OR SET OFF OF THE UNABSORBED DEPRECIATION, WILL BE GOVERNE D BY THE LAW APPLICABLE TO THE YEAR TO WHICH THE UNABSORBED DEPRECIATION RELAT ED. WE THEREFORE AMEND THE ORDER BY MODIFYING THE PARA 2.10.2 WHICH WILL B E SUBSTITUTED BY THE FOLLOWING : 2.10.2 WE HAVE PERUSED THE RECORDS AND CONSIDERED T HE MATTER CAREFULLY. THE DISPUTE IS REGARDING SET OFF OF BROUGHT FORWARD BUSINESS LOSS/UNABSORBED DEPRECIATION. THE AUTHORITIES BELOW HAVE DISALLOWED THE CLAIM ON THE GROUND THAT BUSINESS OF THE ASSESSEE HAD CEASED TO EXIST. HOWE VER, WE HAVE ALREADY GIVEN A FINDING THAT THE INCOME FROM B USINESS CENTRE HAS TO BE ASSESSED AS BUSINESS INCOME. THER EFORE UNDER THE PROVISIONS OF SECTION 72, THE BROUGHT FOR WARD BUSINESS LOSS HAS TO BE ADJUSTED AGAINST THE BUSINE SS INCOME AND IN CASE THE LOSS IS NOT FULLY SET OFF AGAINST B USINESS INCOME IT SHALL BE CARRIED FORWARD TO THE SUBSEQUENT YEAR. AS REGARDS, THE BROUGHT FORWARD UNABSORBED DEPRECIATION IT CAN BE SET OFF AGAINST INCOME UNDER ANY HEAD IF THE UNABSORBED DEP RECIATION RELATES TO ASSESSMENT YEAR 1996-97 AND EARLIER YEAR S OR TO ASSESSMENT YEAR 2002-03 AND SUBSEQUENT YEARS. HOWE VER, IN CASE THE UNABSORBED DEPRECIATION RELATES TO ASSESSM ENT YEAR 1997-98 TO ASSESSMENT YEAR 2001-02, IT CAN BE SET O FF ONLY AGAINST THE INCOME UNDER THE HEAD BUSINESS IN VIE W OF THE DECISION OF THE SPECIAL BENCH IN CASE OF TIMES GUAR ANTY LTD.(SUPRA). WE HOLD ACCORDINGLY. 3. IN THE RESULT, THE MISCELLANEOUS APPLICATION FIL ED BY ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS DAY OF 14 TH SEPTEMBER, 2011. SD/- (R.V. EASWAR) PRESIDENT SD/- (RAJENDRA SINGH) ACCOUNTANT MEMBER MUMBAI, DATED : 14/09/2011 JANHAVI