M/s Maharashtra Apex Corporation Limited , Manipal V. Deputy Commissioner of Income Tax Circle-1 , , Udupi

MA 52/BANG/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 9256 (ITAT-BANGALORE)
• Duration Of Justice: 6 month(s) 10 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 14-08-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 1995-1996
• Appeal Filed On: 03-02-2020
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANJEET SINGH
• Keywords: Depreciation; Sham transactions
• Section: 254(2); 48

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, BANGALORE BEFORE SHRI A. K. GARODIA, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER [MP NO S . 52 TO 55 /B ANG /20 20 (IN ITA NOS.239, 240, 241, 242/BANG/2018)] (ASSESSMENT YEAR S : 1995 - 96 TO 1998 - 99 ) M/S. MAHARASHTRA APEX CORPORATION LTD., SYNDICATE HOUSE, MANIPAL 575 104. PAN : A ACCM 2741 B APPLICANT VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 1, UDUPI . RESPONDENT APPLICANT BY : SHRI. ANIL KUMAR H, CA REVENUE BY : SHRI. MANJEET SINGH, ADDL. CIT DATE OF HEARING : 14 / 0 8 /20 20 DATE OF PRONOUNCEMENT : 14 / 0 8 /20 20 O R D E R PER A. K. GARODIA, AM: ALL THESE MISCELLANEOUS PETITION (MP) ARE FILED BY THE ASSESSEE IN WHICH THIS IS STATED THAT THERE ARE SOME APPARENT MISTAKE IN THE COMBINED TRIBUNAL ORDER DATED 20.09.2019. THESE MPS WERE FILED BY THE ASSESSEE ON 03.02.2020. SUBSEQUENTLY, THE ASSESSEE HAS FILED SOME ADDITIONAL GROUNDS IN RESPECT OF THESE MPS AND THIS REQUEST IS DATED 30.07.2020 AND SINCE THE SAME ARE FILED BY THE ASSESSEE AFTER THE TIME ALLOWED FOR FILING MP UNDER SECTION 254(2) OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED THE ACT) WITHIN 6 MONTHS FROM THE EXPIRY OF THE MONTH IN WHICH THE TRIBUNAL MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 2 OF 11 ORDER IS PASSED, THESE ADDITIONAL GROUNDS ARE NOT ADMITTED AND HENCE NOT CONSIDERED FOR DISPOSAL OF THESE MPS. 2. IN THE COURSE OF HEARING, THE BENCH WANTED TO KNOW THE RELEVANT PARAS OF THE MP IN WHICH THE ASSESSEE HAS POINTED OUT THE APPARENT MISTAKES IN THE COMBINED TRIBUNAL ORDER. IN REPLY, IT WAS SUBMITTED BY LEARNED AR OF THE ASSESSEE THAT PARAS 2 TO 10 OF THESE MPS ARE RELEVANT IN THIS REGARD. HE ALSO SUBMITTED THAT HE HAS FILED 2 SETS OF WRITTEN SUBMISSIONS OUT OF WHICH 1 SET OF WRITTEN SUBMISSION IS FOR MP NO.52 TO 54/BANG/2020 AND THE SECOND SET IS FOR MP NO.55/BANG/2020. HE SUBMITTED THAT THESE MPS SHOULD BE DISPOSED OF BY CONSIDERING THE CONTENTIONS RAISED IN THESE MPS AND THE WRITTEN SUBMISSIONS. AS AGAINST THIS, LEARNED DR SUBMITTED THAT THERE IS NO APPARENT MISTAKE IN THIS COMBINED TRIBUNAL ORDER AND THEREFORE, ALL THESE 4 MPS FILED BY THE ASSESSEE SHOULD BE DISMISSED. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. FIRST OF ALL, WE REPRODUCE PARAS 2 TO 10 FROM MP NO.52/BANG/2020 AS IT HAS BEEN AGREED BY BOTH SIDES THAT THE CONTENTS OF ALL THE MPS ARE SAME. THESE PARAS OF MP ARE AS UNDER: 2) THE ASSESSMENT ORDERS MADE ON PETITIONER FOR THE 3 YEARS ASST YEAR 199596, 1996-97 AND 1997-98 CLEARLY INDICATE THAT THE ORDERS PASSED ARE AS PER DIRECTIONS GIVEN IN THE ORDER OF ITAT BANGALORE BENCH 'A' DATED 19 TH JANUARY 2007 IN ITA NO. 88 & 103 (BANG) / 2000 ITA NO. 170 (BANG) / 2001 (FOUND AT PAGE NO. 53 TO 65 OF THE PAPER BOOK). THE NEW LEASE MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 3 OF 11 TRANSACTIONS ENTERED FOR THESE THREE YEARS HAVE NOT BEEN FOUND TO BE 'SHAM TRANSACTIONS'. THE HONOURABLE TRIBUNAL HAD THEN ONLY DIRECTED THE AO TO DECIDE THE ISSUE OF 'LEASE TRANSACTIONS' AND 'FINANCE TRANSACTIONS' ON THE BASIS OF THE GUIDELINES PROVIDED BY APEX COURT IN THE CASE OF ASEA BROWN BOVERI LTD VS INDUSTRIAL FINANCE CORPORATION LTD TO DECIDE THE ISSUE WHETHER DEPRECIATION IS ALLOWABLE ON THE LEASED ASSETS. AS PER SUBMISSIONS MADE BY THE APPELLANT BEFORE THIS HONOURABLE COURT IN THE SECOND ROUND THE SAID DECISION IS NOT RELEVANT FOR DECIDING ISSUE WHETHER DEPRECIATION IS TO BE DENIED TO LESSOR ON FINANCE LEASE AND ALSO THAT ISSUE WAS ALREADY COVERED BY BOARD CIRCULAR AT THE TIME OF PASSING THE ORDER OF 19-1-2007 AND SUBSEQUENT SUPREME COURT DECISION IN ICDS LTD VS CIT. THESE SUBMISSIONS HAVE BEEN MADE ORALLY AND ALSO IN WRITTEN ARGUMENT. 3) HOWEVER, IN THE SECOND ROUND, THE HONOURABLE TRIBUNAL HAS ERRED IN HOLDING THAT ALL THE NEW LEASE TRANSACTIONS DONE DURING THE ACCOUNTING YEAR ENDED 31.03.1995, 31.03.1996 & 31.03.1997 REFERRED TO IN AO'S ORDERS DATED 26.12.2007, PASSED U/S 143 (3) R.W.S 254 ARE 'SHAM TRANSACTIONS' A) ONLY FOR THE REASON THAT THE LEASE AGREEMENTS WERE NOT BROUGHT ON RECORD BY THE APPLICANT; B) WHEN THERE IS NO FINDING OF THE AO OR CIT-A THAT NO FUNDS HAVE GONE OUT OF THE HANDS OF THE APPLICANT; C) WHEN AO IN PARAGRAPH 6.13 OF HIS ORDER REFERRED TO BY THE HON'BLE MEMEBRS, HAS NOT GIVEN FINDING THAT THE SAID LEASES ARE - SHAM TRANSACTIONS' BUT HAS ONLY HELD THESE TRANSACTIONS AS 'FINANCIAL TRANSACTIONS' BASED ON THE CRITERIA LAID DOWN BY THE HON'BLE SUPREME COURT IN ABB CASE FOR DETERMINING WHETHER A LEASE IS TO BE CLASSIFIED AS A FINANCIAL LEASE OR OPERATING LEASE , AS PER DIRECTIONS GIVEN IN THE ORDER OF ITAT BANGALORE BENCH 'A' DATED 19 TH JANUARY 2007 IN ITA NO. 88 & 103 (BANG) / 2000 ITA NO. 170 (BANG) / 2001 (FOUND AT PAGE NO. 53 TO 65 OF THE PAPER BOOK), AND THE REASONS FOR HOLDING THE CONTRACTS AS ONE OF 'FINANCIAL TRANSACTIONS' ARE DISCUSSED IN PARAGRAPHS 6.9 TO 6.12 OF THE ASSESSMENT ORDER. 4) THE HONOURABLE TRIBUNAL HAS NOW HELD THE LEASE TRANSACTIONS WITH MYSORE POLYMERS & SOWPARNIKA YARS & FABRICS LTD ARE MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 4 OF 11 'SHAM' TRANSACTIONS WHEN THE SAME ARE NOT HELD AS 'SHAM TRANSACTIONS' BY ITAT IN ITS ORDER DATED 19 TH JANUARY 2007. 5) THE HONOURABLE TRIBUNAL HAS NOT DECIDED THE ISSUE OF THE CLAIM OF DEPRECIATION ON 'FINANCIAL LEASED ASSETS' AS PER CBDT CIRCULAR NO. 2/2001 AND INSTRUCTION NO. 1978 DATED 31.12.1999 A COPY OF EACH WAS ENCLOSED AT PAGES NO. 77 TO 82 OF THE PAPER BOOK. 6) THE HONOURABLE TRIBUNAL AT PAGE 24 OF THE ORDER ERRED IN CONCLUDING THAT 'IN A Y 1995-96 WHICH IS BEFORE US, ALSO IT IS NOTED BY THE AO, THE COST OF THE LEASED ASSET IS RS. 1.99 CRORES AND LESSEE HAS TO PAY SECURITY DEPOSIT OF RS. 1.7 CRORES IN ADDITION TO LEASE RENTAL OF RS. 1.69 CRORES IN THE TOTAL PERIOD OF 96 MONTHS, WHEN NO SUCH INSTANCE IS FOUND IN THE 7 LEASE AGREEMENTS DETAILED IN PARAS 6.2 OF THE ASSESSMENT ORDER FOR A Y 1995-96, A SUMMARY OF WHICH WAS GIVEN IN THE PAPER BOOK AT PAGE XIV (REFER ANNEXURE TO THE WRITTEN ARGUMENT FOR SLB MADE DURING THE YEAR), AND REPRODUCED IN PAGE 21 OF THE ITAT ORDER. 7) THE HONOURABLE TRIBUNAL HAS FURTHER ERRED IN STATING THAT 'IT IS SEEN THAT THE FACTS IN THIS YEAR ARE SIMILAR AND NO DIFFERENCE IN FACTS IS POINTED OUT IN OTHER YEARS' WITHOUT HAVING THE LEASE AGREEMENTS BEFORE IT. 8) NON CONSIDERATION BY THE HONOURABLE TRIBUNAL OF THE ARGUMENTS OR JUDGEMENT CITED IN THE WRITTEN SUBMISSIONS OF THE AR REPRODUCED IN THE ORDER, BY DECLARING ALL THE LEASE TRANSACTIONS ENTERED BY APPLICANT IS SHAM TRANSACTIONS BASED ON THE LEASE TRANSACTION OF M/S. J L MORRISON IS A MISTAKE APPARENT FROM RECORD. 9) THE HONOURABLE TRIBUNAL HAS ERRED IN NOT DIRECTING THE RESPONDENT TO ALLOW DEPRECIATION IN THE SUBSEQUENT ASSESSMENT YEAR ON CERTAIN ASSETS WHICH WERE DENIED BY THE A.O. ONLY ON THE GROUND THESE ASSETS WERE ACQUIRED AT THE 'FAG END' OF THE FINANCIAL YEAR. 10) HENCE PARAGRAPHS 3 TO 5 OF THE COMMON ORDER PASSED, RELATING TO DEPRECIATION ON LEASED ASSETS FOR A Y 1995-96, 1996- 97, 1997-98 BE RECALLED AND HEARD ONCE AGAIN. MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 5 OF 11 4. NOW WE ALSO REPRODUCE THE WRITTEN SUBMISSIONS FILED BY LEARNED AR OF THE ASSESSEE IN RESPECT OF MP NOS.52 TO 54/BANG/2020, WHICH READS AS UNDER: 1. ITA NO. 239/2018 FOR A Y 1995-96 GROUND NO. 3 IN GROUNDS OF APPEAL FOR A Y 1995-96 IN ITA NO. 239/BANG/2018 IS THE SAME AS GROUND NO. 3 OF A Y 1996-97 IN ITA NO. 240/BANG/2018 AND GROUND NO. 3 IN ITA NO. 241/BANG/2018. HOWEVER, IN PARA 6 OF THE COMMON ORDER SAME WAS OVERLOOKED AND ONLY GROUND NO. 3 OF ASST YEAR 1996-97 AND 1997-98 WERE CONSIDERED AND ALLOWED. HENCE PARAGRAPH 6 OF THE COMMON ORDER BE AMENDED TO INCLUDE GROUND NO. 3 OF A Y 1995- 96 WITH SUITABLE MODIFICATION IN PARAGRAPHS 7 AND 8 AFTER CONSIDERING ADDITIONAL GROUNDS IN OUR MP IN RESPECT OF ITA NO. 240 AND 241/BANG/2018 BELOW. ITA NO. 240/BANG/2018 FOR A Y 1996-97 AND ITA NO. 241/BANG/2018 FOR A Y 1997-98 ISSUE IN GROUND NO. 3 HAS BEEN ALLOWED SUBJECT TO VERIFICATION BY THE A.O. WHETHER EQUAL AMOUNT OF SECURITY DEPOSIT IS RECEIVED FROM THE LESSEE. THE RELEVANT PORTION OF THE ORDER IS REPRODUCED BELOW (PAGE 27 PARAGRAPH 8): 'REGARDING THESE ASSETS, THIS IS NOT THE FACT POINTED OUT BEFORE US THAT ALMOST EQUAL AMOUNT OF SECURITY DEPOSIT IS RECEIVED BY THE ASSESSEE FROM THE LESSEE. HENCE THIS ISSUE HAS TO BE DECIDED ON MERIT. IN THE PRESENT CASE, TO EXAMINE THESE FACTUAL ASPECTS, LEASE AGREEMENTS HAVE TO BE LOOKED INTO BUT THE SAME IS NOT MADE AVAILABLE BEFORE US. HENCE, WE RESTORE THIS ISSUE TO CIT(A) FOR A FRESH DECISION AFTER EXAMINING THE LEASE AGREEMENTS.. THE APPLICANT DESIRES TO DRAW ATTENTION TO THE RECORDS BEFORE THE HONOURABLE BENCH. THOUGH NO LEASE AGREEMENTS HAVE BEEN FILED BY WAY OF PAPER BOOK, THE ORDERS OF THE A.O. CLEARLY INDICATE THAT IN ALL THE LEASE AGREEMENTS WITH EDUCATIONAL INSTITUTION, EQUAL AMOUNT OF SECURITY DEPOSIT HAVE BEEN OBTAINED. THIS IS ALSO ASSERTED IN THE FOLLOWING PARAGRAPHS OF CIT-A ORDER FOR A Y 1995-96, 1996-97 AND 1997-98, (REFER MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 6 OF 11 PARAGRAPHS 5 7 1 OF CIT-A ORDER FOR A Y 1995-96, 5 7 1 OF CIT- A ORDER FOR A Y 1996-97 AND 5 7 3 OF CIT-A ORDER FOR A Y 1997- 98). HENCE LOWER AUTHORITIES HAVE GIVEN A FINDING THAT THE SECURITY DEPOSITS RECEIVED EQUAL THE INVESTMENT OF THE APPELLANT IN THE ASSETS WHICH IS NOT DISPUTED. THE APPLICANT ALSO WISHES TO DRAW ATTENTION TO THE DECISION OF THE HONOURABLE KARNATAKA HIGH COURT, IN MANIPAL FINANCE CORPORATION LIMITED VS ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1, UDUPI ENCLOSED IN PAGES 121 TO 125 OF THE WRITTEN SUBMISSIONS FILED BEFORE THE HONOURABLE BENCH. IN PARAGRAPH 1 OF THE SAID JUDGEMENT, THE HONOURABLE HIGH COURT SETS OUT THE BRIEF FACTS OF THE CASE, WHEREIN IT HAS NOTICED THAT LESSOR HAS OBTAINED DEPOSIT EQUIVALENT TO THE COST OF THE EQUIPMENT FROM THE LESSEES AND IS ALSO AWARE OF THE EARLIER ORDER OF THE HIGH COURT, CITED BY THE CIT-A IN OUR CASE FOR UPHOLDING THE DISALLOWANCE. HAVING CONSIDERING THE ABOVE FACTS, THE COURT HAS FOLLOWED THE SUPREME COURT ORDER IN ICDS LTD VS CIT [2013] 350 ITR 527 THAT DEPRECIATION IS AVAILABLE TO THE OWNER OF THE ASSET WHO USES IT IN HIS BUSINESS, WHICH IN THIS CASE IS THE BUSINESS OF LEASING AND ALLOWED THE CLAIM OF DEPRECIATION. HOWEVER IF MATTER IS REMITTED BACK TO CIT-A FOR RE-VERIFICATION OF THE FACTS ALREADY NOTED IN HIS ORDERS, IT WOULD RESULT IN INTERPRETATIONAL ISSUES REGARDING THE DIRECTIONS CONTAINED IN THE ORDER OF THE HONOURABLE BENCH AS TO WHETHER DEPRECIATION IS TO BE ALLOWED IF DEPOSIT EQUALS VALUE OF ASSET. HENCE IN VIEW OF THE MATTER BEING VERY OLD, THE HONOURABLE BENCH IS REQUESTED TO MODIFY PARAGRAPH 8 OF THE ORDER, WITHDRAWING THE RESTORATION OF THE CASE TO THE CIT-A AND DEPRECIATION BE DIRECTED TO BE GRANTED FOLLOWING THE JUDGEMENT OF THE JURISDICTIONAL HIGH COURT. 5. NOW WE REPRODUCE THE WRITTEN SUBMISSIONS FILED BY LEARNED AR OF THE ASSESSEE IN MP NO.55/BANG/2020 AS UNDER: 1. IN THIS PETITION THE APPLICANT IS SEEKING THE RECALL OF PARAGRAPHS 9 & 10 OF THE COMMON ORDER PASSED WHEREIN IT HAS BEEN HELD THAT THE APPELLANT IS NOT THE OWNER OF ASSETS IN THE CASE OF TWO LEASES, JUST BECAUSE A SMALL PORTION OF THE PURCHASE PRICE HAS NOT GONE DIRECTLY FROM THE APPELLANT TO THE SUPPLIERS BUT GONE MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 7 OF 11 FROM THE LESSEES. IN THE WORDS OF THE HONOURABLE BENCH ' WHEN FULL COST WAS NOT BORNE BY THE ASSESSEE, HOW THE ASSESSEE CAN CLAIM OWNERSHIP AND CLAIM DEPRECIATION' 2. ALL SUBMISSIONS MADE BY THE UNDERSIGNED BEFORE THE HONOURABLE BENCH, BOTH ORAL AND WRITTEN, WERE WITH REFERENCE TO THE ITA NO 239-241/2018 RELATING TO ASSESSMENT YEAR 1995- 96,1996-97 AND 1997-98. THE HEARINGS IN ITA NO 239-241/2018 CONCLUDED ON JULY 31S T , 2019 IN THESE CASES. NO WRITTEN SUBMISSIONS WERE FILED ON 8-8-2019 IN THIS APPEAL, RELYING ON THE BOARD CIRCULAR AND THE DOCUMENTS FILED IN THE PAPER BOOK WHICH CLEARLY SHOWED THAT APPELLANT WAS THE OWNER OF THE ASSETS GIVEN ON LEASE IN THE RELEVANT PREVIOUS YEARS. 3. THE APPELLANT IS AGGRIEVED THAT THE ORDER OF THE HONOURABLE BENCH HAS NOT CONSIDERED THE BOARD CIRCULAR AND DECIDED CASE LAWS WHICH ARE ENCLOSED/ REFERRED IN THE PAPER BOOK FOR ITA NO 239-241/2018 RELATING TO ASSESSMENT YEAR 1995-96,1996-97 AND 1997-98, WHILE HOLDING THAT THE APPELLANT IS NOT THE OWNER OF THE LEASED ASSETS TO BE ELIGIBLE FOR DEPRECIATION. 4. HAD THE HONOURABLE BENCH ASKED THE UNDERSIGNED ' WHEN FULL COST WAS NOT BORNE BY THE ASSESSEE, HOW THE ASSESSEE CAN CLAIM OWNERSHIP AND CLAIM DEPRECIATION' , ATTENTION WOULD HAVE BEEN DRAWN TO THE FOLLOWING DOCUMENTS ENCLOSED IN THE PAPER BOOK: A. INVOICES IN THE NAME OF THE APPELLANT, MADE OUT FOR THE FULL VALUE OF THE ASSETS GIVEN ON LEASE ENCLOSED IN PAGES 27, 55 AND57 OF THE PAPER BOOK . B. INSURANCE POLICES, ISSUED IN THE YEAR 2000- 2001 WHICH STILL CONTINUE TO SHOW THE APPELLANT AS THE OWNER. THESE POLICIES ENCLOSED IN PAGES 39 AND 69 WERE ISSUED BY PUBLIC SECTOR INSURANCE COMPANIES WHICH WOULD NOT ISSUE POLICY WITHOUT SATISFYING THEMSELVES ABOUT THE OWNERSHIP. C. LEASE AGREEMENTS BETWEEN THE APPELLANT AND THE LESSEES ACCEPTING THAT APPELLANT IS THE OWNER OF THOSE ASSETS THOUGH PART CONSIDERATION WAS PAID BY THE LESSEE TO THE VENDORS. MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 8 OF 11 THIS QUESTION WAS NEVER PUT TO THE UNDERSIGNED/ DISCUSSED IN THE HEARING. 5. GRANTING FOR ARGUMENTS SAKE THAT THE HONOURABLE TRIBUNAL MAY BE RIGHT IN HOLDING THAT THE ASSESSEE IS NOT THE FULL OWNER OF THE ASSET BECAUSE A PORTION OF THE COST HAS GONE FROM THE LESSEE, DEPRECIATION UNDER SECTION 32(1) IS AVAILABLE TO A PERSON WHO IS A PART OWNER. SECTION 43(1) ALSO ENVISAGES A CONDITION WHERE FULL PAYMENT FOR AN ASSET MAY NOT BE MADE BY THE OWNER WHILE DEFINING 'ACTUAL COST' TO MEAN 'THE ACTUAL COST OF THE ASSETS TO THE ASSESSEE AS REDUCED BY THAT PORTION THEREOF, IF ANY, HAS BEEN MET DIRECTLY OR INDIRECTLY BY ANY OTHER PERSON OR AUTHORITY'. THE APPLICANT HAS ACCORDINGLY CLAIMED DEPRECIATION ON COST TO IT IN TERMS OF SECTION 43(1). PRAYER HENCE, BOTH ON FACTS AS WELL AS IN LAW, THE HONOURABLE BENCH IS IN ERROR IN DISALLOWING DEPRECIATION, FOLLOWING THE LINE OF REASONING THAT ' WHEN FULL COST WAS NOT BORNE BY THE ASSESSEE, HOW THE ASSESSEE CAN CLAIM OWNERSHIP AND CLAIM DEPRECIATION'. THE HONOURABLE BENCH MAY THEREFORE KINDLY RECALL PARAGRAPHS 8 AND 9 OF THE COMMON ORDER WHICH HELD THAT APPELLANT IS NOT THE OWNER OF THE ASSETS AND DECIDE THE APPEAL FOR AY 1998-99 IN TERMS OF BOARD CIRCULAR AND EVIDENCE ON RECORD, CALLING FOR ANY FURTHER SUBMISSIONS AND EVIDENCES IF CONSIDERED NECESSARY, IN THE INTEREST OF JUSTICE AND FAIR PLAY. 6. WE ALSO FIND THAT THE ISSUE IN DISPUTE WAS DECIDED BY THE TRIBUNAL AS PER PARA 5 OF THE IMPUGNED COMBINED TRIBUNAL ORDER AND HENCE, FOR READY REFERENCE, THIS PARA 5 OF THE IMPUGNED TRIBUNAL ORDER IS REPRODUCED HEREIN BELOW: 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT NOT EVEN ONE LEASE AGREEMENT IS MADE AVAILABLE BEFORE US. THE AO IN THE ASSESSMENT ORDER HAS DISCUSSED ABOUT VARIOUS CLAUSES OF SOME LEASE AGREEMENTS AND AFTER MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 9 OF 11 CONSIDERING A TRIBUNAL ORDER RENDERED IN THE CASE OF CENTRE FOR MONITORING INDIAN ECONOMY VS. DCIT IN ITA NO. 3820/BOM/1990, THE AO NOTED THAT IN THIS CASE OF IDENTICAL NATURE, THE TRIBUNAL HELD THAT IT WAS NOT A LEASE AGREEMENT BUT A HIRE PURCHASE AGREEMENT CAMOUFLAGED AS LEASE AGREEMENT AND IN THE ABSENCE OF LEASE AGREEMENT, WE HAVE NO OPTION BUT TO HOLD THAT THERE IS NO INFIRMITY IN THE ASSESSMENT ORDER ON THIS ISSUE. IN MOST OF THE REMAINING APPEALS, NO DIFFERENCE IN FACTS IS POINTED OUT AND FOR THOSE APPEALS ALSO, NO LEASE AGREEMENT IS BROUGHT ON RECORD. IN THE TRIBUNAL ORDER IN THE ASSESSEE'S OWN CASE FOR A. YS. 1992 - 93 TO 1994 - 95 IN ITA NOS. 17, 48 & 87/BANG/2000 DATED 06.10.2003, COPY AVAILABLE ON PAGES 23 TO 29 OF THE PAPER BOOK, THE TRIBUNAL HELD THAT THE LEASE TRANSACTION IS SHAM BECAUSE THE ASSESSEE ON THE ONE HAND PAYS THE VALUE OF MACHINERY AND AT THE SAME TIME, RECEIVES THE EQUIVALENT AMOUNT AS DEPOSIT AND THUS, THERE IS NO OUT FLOW OF FUND SO AS TO VALIDLY MAKE PAYMENT FOR PURCHASE PRICE. IN A. Y. 1995 - 96 WHICH IS BEFORE US ALSO, IT IS NOTED BY THE AO ON PAGE 20 OF THE ASSESSMENT ORDER FOR A. Y. 1995 - 96 THAT COST OF THE LEASED ASSET IS RS. 1.99 CRORES AND THE LESSEE HAD TO PAY SECURITY DEPOSIT OF RS. 1.7 CRORES IN ADDITION TO LEASE RENTAL OF RS. 1.69 CRORES IN THE TOTAL LEASE PERIOD OF 96 MONTHS. IT IS SEEN THAT THE FACTS IN THIS YEAR ARE SIMILAR AND NO DIFFERENCE IN FACTS IS POINTED OUT IN ANY OTHER YEAR. WHEN, THE LEASE TRANSACTION ITSELF IS SHAM AS PER THE EARLIER TRIBUNAL ORDER IN ASSESSEE'S OWN CASE UNDER SIMILAR FACTS, NO OTHER ARGUMENT OR JUDGMENT CITED IN THE WRITTEN SUBMISSIONS REPRODUCED ABOVE IS REQUIRED TO BE CONSIDERED. HENCE, WE DECLINE TO INTERFERE IN THE ORDERS OF THE LOWER AUTHORITIES ON THIS ISSUE IN ALL YEARS. 7. FROM THE ABOVE PARA 5 OF THE IMPUGNED TRIBUNAL ORDER, IT IS SEEN THAT THE TRIBUNAL HAS DECIDED THE ISSUE ON THIS BASIS IN ALL THESE APPEALS THAT NOT EVEN ONE LEASE AGREEMENT IS MADE AVAILABLE BEFORE THE TRIBUNAL AND THE AO IN THE ASSESSMENT ORDER HAS DISCUSSED ABOUT VARIOUS CLAUSES OF SOME LEASE MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 10 OF 11 AGREEMENT AND AFTER CONSIDERING THE TRIBUNAL ORDER RENDERED IN THE CASE OF CENTRE FOR MONITORING INDIAN ECONOMY VS. DCIT IN ITA NO.3820/BOM/1990, THE AO NOTED THAT IN THIS CASE OF IDENTICAL NATURE, THE TRIBUNAL HELD THAT IT WAS NOT THE LEASE AGREEMENT BUT A HIRE PURCHASE AGREEMENT CAMOUFLAGED AS LEASE AGREEMENT AND IN THE ABSENCE OF LEASE AGREEMENT, WE HAVE NO OPTION BUT TO HOLD THAT THERE IS NO INFIRMITY IN THE ASSESSMENT ORDER ON THIS ISSUE. HENCE, IT IS SEEN THAT THE BASIS OF THE DECISION OF THE TRIBUNAL IS THIS THAT THE ASSESSEE HAS NOT MADE AVAILABLE THE COPY OF THE LEASE AGREEMENT BEFORE THE TRIBUNAL AND BECAUSE OF THIS REASON, THE TRIBUNAL HAS HELD IN THE IMPUGNED TRIBUNAL ORDER THAT THERE IS NO INFIRMITY IN THE ASSESSMENT ORDER ON THIS ISSUE I.E. THE ISSUE REGARDING DISALLOWANCE OF DEPRECIATION ON FINANCE LEASE. IN THE MPS FILED BY THE ASSESSEE, THIS IS NOT THE CONTENTION RAISED BY THE ASSESSEE THAT THERE IS ANY MISTAKE IN THIS FINDING OF THE TRIBUNAL THAT NO LEASE AGREEMENT WAS MADE AVAILABLE BEFORE THE TRIBUNAL. SINCE, THIS IS THE BASIS OF THE TRIBUNALS DECISION THAT IN THE ABSENCE OF LEASE AGREEMENT, THE TRIBUNAL HAS NO OPTION BUT TO HOLD THAT THERE IS NO INFIRMITY IN THE ASSESSMENT ORDER ON THE ISSUE OF DISALLOWANCE OF DEPRECIATION, WE ARE OF THE CONSIDERED OPINION THAT VARIOUS CONTENTIONS RAISED BY THE MP NO. 52 TO 55/BANG/2020 (IN ITA NOS.239, 240, 241, 242/BANG/2018) PAGE 11 OF 11 ASSESSEE IN THESE MPS AND IN THE WRITTEN SUBMISSIONS FILED BY LEARNED AR OF THE ASSESSEE IN BOTH WRITTEN SUBMISSIONS HAS NO RELEVANCE FOR THE PURPOSE OF DECIDING THESE MPS. HENCE, WE HOLD THAT THERE IS NO MERIT IN THESE MPS. 8. IN THE RESULT, ALL THE FOUR MPS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE. SD/- SD/- ( PAVAN KUMAR GADALE ) JUDICIAL MEMBER (A. K. GARODIA) ACCOUNTANT MEMBER PLACE : BANGALORE DATED : 14/08/2020 /NS/* COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A)-II BANGALORE 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL BANGALORE