The ACIT, Rajahmundry V. Md Nausad Ali, Kovvur

MA 40/VIZ/2016

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6970 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 8 month(s) 7 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 18-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C DAS
• Keywords: Business income; Depreciation
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . . , BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , ACCOUNTANT MEMBER M.P .NO. 40 /VIZ/ 201 6 (ARISING OUT OF I.T.A.NO.637/VIZ/2013) ( / ASSESSMENT YEAR: 20 0 9 - 1 0 ) THE ACIT CIRCLE - 1 RAJAHMUNDRY VS. MD.NAUSAD ALI D.NO.15 - 05 - 07 OPP.GIRLS HIGH SCHOOL BAPUJI NAGAR KOVVUR [PAN :AAZPM9193M] ( / APPELLANT) ( / RESPONDENT) / APPELLANT BY : SHRI K.C.DAS, DR / RESPONDENT BY : SHRI G.V.N.HARI, AR / DATE OF HEARING : 20 . 0 7 . 2018 / DATE OF PRONOUNCEMENT : 25 .0 7 .2018 / O R D E R PER D.S. SUNDER SINGH , ACCOUNTANT MEMBER : THE REVENUE HAS FILED THIS MISCELLANEOUS PETITION AGAINST THE ORDER OF THE ITAT IN ITA NO.637/V IZ/2013 DATED 25/02/2016 . 2 I TA NO .196 /VIZ/201 7 SRI NOOKALAMMA AMMAVARI DEVASTHANAM, KANDRAKOTA 2. IN THIS CASE, THE ASSESSEE FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS.41,83,920/ - BESIDES AGRICULTURAL INCOME OF RS.2,90,862/ - . IN THE ASSESSMENT PROCEEDINGS, THE AO COMPLETED THE ASSESSMENT REJECTING THE BOOKS OF ACC OUNTS OF THE ASSESSEE AND ESTIMATING THE INCOME ON GROSS RECEIPTS @6% AND ALSO SEPARATELY ASSESSED THE INCOME FROM OTHER SOURCES INCLUDING THE INSURANCE. T HE AO COM PLETED THE ASSESSMENT U/S 143(3) ON TOTAL INCOME OF RS.72,08,150/ - . OUT OF WHICH THE INCOM E FROM OTHER SOURCES WAS RS.12,80,826/ - WHICH INCLUDES INSURANCE PREMIUM OF RS.8,00,000/ - . 3. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE WENT ON APPEAL BEFORE THE CIT(A) AND RAISED THE ADDITIONAL GROUND BEFORE THE CIT(A) WHICH IS DISCUSSED IN PARA NO. .5 STAT ING THAT THE INSURANCE CLAIM WAS BUSINESS RECEIPT WHICH REQUIRED TO BE REDUCED FROM THE COST OF ASSET FOR THE PURPOSE OF COMPUTING THE DEPRECIATION AND NO SEPARATE ADDITION IS REQUIRED TO BE MADE. THE LD.CIT(A) CONSIDERED THE ADDITIONAL GROUND AND SUBMISSION OF THE ASSESSEE IN PARA NO. 6.2 OF THE APPELLATE ORDER AND CONFIRMED THE ADDITION MADE AS INCOME FROM OTHER SOURCES. 3 I TA NO .196 /VIZ/201 7 SRI NOOKALAMMA AMMAVARI DEVASTHANAM, KANDRAKOTA 4. AGGRIEVED BY THE ORDER OF THE CIT(A), THE ASSESSEE CARRIED THE APPEAL BEFORE THIS TRIBUNAL AND RAISED THE GROUND ON INSURAN CE CLAIM IN GROUND NO.1(A) AND 1(B) IN GROUNDS OF APPEAL. THE ITAT CONSIDERED THE APPEAL OF THE ASSESSEE AND DIRECTED THE AO TO REEXAMINE THE ISSUE IN THE LIGHT OF THE DISCUSSION MADE IN PARA NO.5 AND 6 OF THE ORDER AFTER AFFORDING THE OPPORTUNITY OF HEARING TO THE ASSESSEE. 5. AGAINST THE ORDER OF THE ITAT, THE REVENUE FILED MISCELLANEOUS APPLICATION AND RAISED THE FOLLOWING GROUNDS. I) THE HON'BLE ITAT COULD NOT HAVE CONSIDERED THE FRESH ISSUE WITH REGARD TO ADDITION ON ACCOUNT OF INSURANCE CLAIM AS IT IS NOT BORNE OUT OF THE ORDER THAT THE ASSESSEE HAS RAISED ANY ADDITIONAL GROUND WITH REGARD TO EXAMINING THE CHARACTER OF EXPENDITURE INCURRED TOWARDS REPAIRS TO DAMAGED EXCAVATOR EITHER BEFORE THE FIRST APPELLATE AUTHORITY OR BEFORE THE HON'BLE ITAT. II) WHETHER THE HON'BLE ITAT HAS JURISDICTION TO ENTERTAIN AND ADJUDICATE OR FOR THAT MATTER REMIT BACK THE ISSUE TO THE ASSESSING OFFICER ALTOGETHER AFRESH ISSUE WHICH WAS NOT BEFORE THE LOWER AUTHORITIES AND PARTICULARLY WHEN THERE BEING NO ADDITIONAL GROUND RAISED BY THE ASSESSEE BEFORE THE HON'BLE BENCH, AS IS APPARENT FROM THE ORDER. DURING THE A PPEAL HEARING, THE LD.DR STRONGLY SUPPORTE D THE MISCELLANEOUS APPLICATION, PER CONTRA THE LD.AR ARGUED THAT THERE IS NO ERROR IN THE ORDER PASSED BY THE ITAT. 4 I TA NO .196 /VIZ/201 7 SRI NOOKALAMMA AMMAVARI DEVASTHANAM, KANDRAKOTA 6. WE HAVE GONE THROUGH THE MISCELLANEOUS AP PLICATION AND THE ORDER OF THIS TRIBUNAL. IN ITS ORDE R , THE TRIBUNAL HAS GIVEN A FINDING THAT THE ASSESSEE CLAIMED TO HAVE INCURRED THE EXPENDITURE OF RS.17,40,198/ - TOWARDS THE REPAIR OF THE DAMAGED EXCAVATOR A S THE SAME WAS NEITHER EXAMINED BY THE AO N OR BY THE CIT(A), WHETHER THE EXPENDITURE IN QUESTION WAS REVENUE AND DEBITED TO PROFIT AND LOSS ACCOUNT OR CAPITAL IN NATURE AND ADDED TO THE COST OF THE ASSET TO CLAIM DEPRECIATION. THE AO FILED MISCELLANEOUS APPLICATION STATING THAT THE ISSUE WITH REGARD TO THE INSURANCE CLAIM WAS NOT BORN OUT OF THE ORDER O F THE CIT(A) NOR RAISED AS ADDITIONAL GROUND BEFORE THE ITAT. T HE AO ALSO RAISED A GROUND QUESTIONING THE JURISDICTION OF THE ITAT IN ADJUDICATING THE ISSUE STATING THAT THE ITAT HAS TR AVELLED BEYOND ITS JURISDICTION TO ENTERTAIN AND ADJUDICATE THE ISSUE THOUGH THERE WAS NO ADDITIONAL GROUND . IN THIS CASE AS DISCUSSED EARLIER, THE ISSUE WAS NOT A FRESH ISSUE AND WAS FIRST RAISED BEFORE THE CIT(A ) AND LD. CIT(A) HAS ADJUDICATED THE ISSUE IN PARA NO.6.2 OF THE APPELLATE ORDER. THEREFORE, THERE IS NO REQ UIREMENT TO RAISE THE ADDITIONAL GROUND BEFORE THE ITAT. THE AO MADE A MISTAKE IN STATING THAT THE ITAT HAS CONSIDERED THE FRESH ISSUE WHICH WAS NOT ADJUDICATED BY THE CIT(A). THE ITAT HAS CONSIDERED THE ENTIRE ISSUE WITH REGARD TO THE 5 I TA NO .196 /VIZ/201 7 SRI NOOKALAMMA AMMAVARI DEVASTHANAM, KANDRAKOTA INSURANCE CLAIM , T HE EXPENDITURE INCURRED FOR REPAIR OF EXCAVATOR AND THE DEPRECIATION . IN THE ABSENCE OF ANY SPECIFIC FINDING WHETHER THE ASSESSEE CLAIMED THE EX PENDITURE AS CAPITAL OR REVENUE, THE ITAT HAS REMITTED THE MATTER BACK TO THE FILE OF THE AO TO DECIDE THE ISSUE FRESH ON MERITS . THEREFORE, THERE IS NO MISTAKE IN THE ORDER OF THE ITAT WHICH REQUIRE RECTIFICATION U/S 25 4(2) OF I.T.ACT. ACCORDINGLY, THE M ISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. 7. IN THE RESULT, THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 25 TH JU LY , 201 8 . SD/ - SD/ - ( . ) ( . . ) (V. DURGA RAO) ( D.S. SUNDER SINGH ) /JUDICIAL MEMBER /ACCOUNTANT MEMBER /VISAKHAPATNAM /DATED : 25 .0 7 .2018 L.RAMA, SPS 6 I TA NO .196 /VIZ/201 7 SRI NOOKALAMMA AMMAVARI DEVASTHANAM, KANDRAKOTA / COPY OF THE ORDER FORWARDED TO: - 1 . / THE ASSESSEE - MD.NAUSAD ALI , D.NO.15 - 05 - 07 , OPP.GIRLS HIGH SCHOOL , BAPUJI NAGAR , KOVVUR 2 . / THE REVENUE THE ACIT , CIRCLE - 1 , RAJAHMUNDRY 3 . THE PR. COMMISSIONER OF INCOME TAX , RAJAHMAHENDRAVARAM 4. THE COMMISSIONER OF INCOME TAX(APPEALS), VISAKHAPATNAM 5 . , , / DR, ITAT, VISAKHAPATNAM 6. / GUARD FILE / BY ORDER // TRUE COPY // SR. PRIVATE SECRETARY ITAT, VISAKHAPATNAM 7 I TA NO .196 /VIZ/201 7 SRI NOOKALAMMA AMMAVARI DEVASTHANAM, KANDRAKOTA SL. NO. DESCRIPTION DATE INITIALS 1. DATE OF DICTATION BY THE AUTHOR 20 .07.2018 SR.PS 2. DRAFT PLACED BEFORE THE DICTATING MEMBER 2 4 .07.2018 SR.PS 3. DRAFT PLACED BEFORE THE SECOND MEMBER SR. PS 4. DRAFT APPROVED BY THE SECOND MEMBER SR. PS 5. DATE OF APPROVED ORDER COMES TO THE SR. PS .07.2018 SR. PS 6. DATE OF PRONOUNCEMENT OF ORDER .07.2018 SR. PS 7. DATE OF FILE SENT TO THE BENCH CLERK SR. PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK HD. CLK 9. DATE OF DESPATCH OF ORDER SR. PS