The DCITAnand Circle, Anand V. Elecon Engineering Co.Ltd., Anand

MA 235/AHD/2012

• Counselvise Citation: [2013] 123 COUNSELVISE.COM (IT) 9907 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-03-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2002-2003
• Appeal Filed On: 26-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K SINGH
• Assessee Lawyers: M K PATEL
• Keywords: Capital asset; Revenue expenditure; Capital expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, D BENCH, AHMEDABAD BEFORE SHRI D.K.TYAGI, JUDICIAL MEMBER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER M.A.NO.235/AHD./2012 IN I.T.A. NO.3893 / AHD/2007 (ASSESSMENT YEAR 2002-03) DCIT, ANAND CIRCLE, AHAND VS. ELCON ENGINEERING CO. LTD., ANAND SOJITTRA ROAD, V.V.NAGAR, ANAND PAN/GIR NO. : AAACE4644D (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI D K SINGH, SR. DR RESPONDENT BY: SHRI M K PATEL, AR DATE OF HEARING: 01.03.2013 DATE OF PRONOUNCEMENT: 08.03.2013 O R D E R PER SHRI A. K. GARODIA, AM:- THIS MISCELLANEOUS APPLICATION IS FILED BY THE REV ENUE AND FOR THE SAKE OF READY REFERENCE, THE CONTENTS OF THE MISCEL LANEOUS APPLICATION ARE REPRODUCED BELOW: PETITION U/S.254(2) OF THE INCOME-TAX ACT, 1961 IN THE CASE OF ELECON ENGINEERING CO. LTD. ANAND-SOJITRA ROAD, V.V . NAGAR, ANAND - A.Y.2002-03 IN ITA NO.3893/AHD/2007 DATED 1 8/05/2012 IN THE CASE OF ELECON ENGINEERING CO. ETD., ANAND F OR A.Y.2002- 03 AN APPEAL WAS INSTITUTED BY THE ASSESSEE BEFORE THE HON'BLE TRIBUNAL AGAINST THE ORDER OF THE CIT(A)-IV, BARODA BEARING NO.CAB/IV-A-102/05-06 DATED 31/07/2007. WHILE FINALIZING THE APPEAL, HON'BLE ITAT 'D' BENCH , AHMEDABAD HAVE DECIDED THE APPEAL FILED BY THE ASSESSEE I.E. ELECON ENGINEERING COMPANY LTD., ANAND FOR A.Y. 2002-03 IN ITA NO.3893/AHD/2007 DATED 18/05/2012, WHEREIN, THE HON 'BLE ITAT 'D' BENCH HAVE DECIDED THE ISSUE OF 'R.T.O. TAX EXP ENSES' IN FAVOUR OF ASSESSEE BY HOLDING EXPENDITURE INCURRED ON ROAD TAX AS REVENUE EXPENDITURE. IT IS HOWEVER, PERTINENT TO ME NTION HERE THAT M.A.NO.235 /AHD/2012 2 THE SAME ITAT 'D' BENCH, AHMEDABAD, WHILE DECIDING THE CASE OF EIMCO ELECON (I) ETD., ANAND FOR A.Y. 2002-03, IN I TA NO.L89/AHD/2006 DATED 18/12/2009 HAVE DECIDED THE S AME ISSUE REGARDING R.T.O. TAX IN FAVOUR OF THE DEPARTMENT BY HOLDING THE EXPENDITURE AS CAPITAL EXPENSES. SINCE, THE DECISION OF HON'BLE ITAT IS PERVERSE ON FACTS, THE SAME HAS RESULTED IN AN APPARENT ERROR IN THE ORDER OF I TAT, 'D' BENCH, AHMEDABAD IN ITA NO.3893/AHD/2007 DATED 18/05/2012 IN THE CASE OF M/S. ELECON ENGINEERING CO. ETD., ANAND FOR A.Y.2002-03. UNDER THE ABOVE FACTS AND CIRCUMSTANCES, THIS PETIT ION IS BEING FILED BEFORE THE HON'BLE TRIBUNAL IN VIEW OF THE DI RECTIONS OF THE C.I.T.-II, BARODA CONTAINED IN HIS LETTER NO.BRD/CI T- II/HQ/154/VC/2011-12 DATED 07/12/2012, A COPY OF WH ICH IS ENCLOSED (ANNEX.4). IT IS, THEREFORE, PRAYED THAT:- 'THE DECISION DATED 18/05/2012 OF THE HON'BLE I.T.A .T. 'D' BENCH, IN SO FAR AS THE ISSUE REGARDING RTO TAX EXPENSES, MAY KINDLY BE TREATED AS CAPITAL EXPENDITURE AS THE SAME ISSUE WA S DECIDED IN FAVOUR OF THE REVENUE IN THE CASE OF EIMCO ELECON ( I) LTD. FOR A.Y.2002-03 BY THE HON'BLE ITAT, 'D' BENCH, VIDE OR DER IN ITA NO.L89/AHD/2006 DATED 18/12/2009, AND A FRESH ORDER MAY KINDLY BE MADE IN THE CASE OF ELECON ENGINEERING COMPANY L TD., ANAND FOR A.Y.2002-03.' 2. IT WAS SUBMITTED BY THE LD. D.R. THAT IN THE IMP UGNED ORDER, THE TRIBUNAL HAS DECIDED THE ISSUE IN FAVOUR OF THE ASS ESSEE REGARDING RTO TAX EXPENSES WHEREAS IN THE CASE OF EIMCO ELECON (I ) LTD., FOR ASSESSMENT YEAR 2002-03 IN I.T.A.NO. 189/AHD/2006 DATED 18.12. 2009, SIMILAR ISSUE WAS DECIDED BY THE TRIBUNAL IN FAVOUR OF THE REVENU E AND IT WAS HELD THAT THE RTO TAX AT THE TIME OF PURCHASE OF THE VEHICLE IS A CAPITAL EXPENDITURE. IT WAS SUBMITTED BY THE LD. D.R. BEFO RE US THAT SINCE THE IMPUGNED TRIBUNAL ORDER IS NOT IN LINE WITH THE EAR LIER TRIBUNAL ORDER DATED 18.12.2009, THERE IS APPARENT MISTAKE IN THIS TRIBUNAL ORDER. AT THIS JUNCTURE, A QUERY WAS RAISED BY THE BENCH AS TO WHE THER THE EARLIER TRIBUNAL ORDER DATED 18.12.2009 WAS BROUGHT TO THE NOTICE OF THE TRIBUNAL AT THE TIME OF HEARING OF THE APPEAL AND IN REPLY, LD. D.R. COULD NOT ESTABLISH THAT ATTENTION OF THE TRIBUNAL WAS DRAWN TO THE EARLIER TRIBUNAL ORDER DATED 18.12.2009 AT THE TIME OF HEARING OF TH IS APPEAL. HENCE, WE M.A.NO.235 /AHD/2012 3 ARE OF THE CONSIDERED OPINION THAT SINCE THE TRIBUN AL ORDER DATED 18.12.2009 WAS NOT BROUGHT TO THE NOTICE OF THE TRI BUNAL AT THE TIME OF HEARING OF THIS APPEAL, THE SAME CANNOT BE BROUGHT TO OUR NOTICE IN THE COURSE OF MISCELLANEOUS APPLICATION AND ON THIS BAS IS, IT CANNOT BE SAID THAT THERE IS ANY APPARENT MISTAKE IN THE IMPUGNED TRIBUNAL ORDER. WE ALSO FIND THAT THIS FINDING IS ALSO GIVEN BY THE TR IBUNAL IN THE IMPUGNED ORDER THAT AS PER THE JUDGEMENT OF HONBLE ALLAHABA D HIGH COURT RENDERED IN THE CASE OF JANARDAN PRASAD ASHOK PRASA D VS CIT AS REPORTED IN 193 ITR 186, CAR CAN BE USED EVEN BEFORE PAYMENT OF RTO TAX AND THEREFORE, PAYMENT OF RTO TAX DOES NOT RESULT INTO CREATION OF ANY CAPITAL ASSET BECAUSE THE CAR IS ALREADY IN EXISTENCE AND T HE ROAD TAX IS REQUIRED TO BE PAID BEFORE RUNNING OF THE CAR. ON THIS BASIS, IT WAS HELD BY THE TRIBUNAL IN THE IMPUGNED ORDER THAT THIS IS REVENUE EXPENDITURE AND NOT A CAPITAL EXPENDITURE. WE HAVE ALREADY NOTED THAT TH E EARLIER TRIBUNAL ORDER DATED 18.12.2009 WAS NEVER BROUGHT TO THE NOTICE OF THE TRIBUNAL AND IN THE IMPUGNED ORDER, THE TRIBUNAL HAS FOLLOWED A HIG H COURT DECISION AND HENCE, THERE IS NO MISTAKE IN THE TRIBUNAL ORDER. 3. IN THE RESULT, MISCELLANEOUS APPLICATION OF THE REVENUE IS DISMISSED. 4. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE M ENTIONED HEREINABOVE. SD./- SD./- (D. K. TYAGI) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER SP COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD BY ORDER 6. THE GUARD FILE AR,ITAT,AHMEDABAD M.A.NO.235 /AHD/2012 4 1. DATE OF DICTATION 01.03.2013 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 05.03.2013.OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 08/03/2013 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S.8/3 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 08/0 3/2013 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. .