Income Tax Appellate Tribunal - Chennai
Dcit Corporate Circle 1(2), Chennai vs Bay Container Terminal (P) Ltd., ... on 4 March, 2019
आयकर अपील य अ धकरण, 'ए' यायपीठ, चे नई।
IN THE INCOME TAX APPELLATE TRIBUNAL
'A' BENCH: CHENNAI
ी जॉज माथन, या यक सद य एवं ी इंटूर रामा राव, लेखा सद य के सम&
BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND
SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER
आयकर अपील सं./ITA Nos.1214/Chny/2015, 642/Chny/2016 & 2614/Chny/2017
नधा रण वष /Assessment Years: 2010-11, 2011-12 & 2012-13
Dy. Commissioner of Income Tax, Vs. M/s. Bay Container Terminal Pvt.
Corporate Circle-1(2), Ltd.,
Chennai. No.21, Old No.18,
Swami Sivananda Salai, Chepauk,
Chennai - 600 005.
[PAN: AAACB 3622L]
(अपीलाथ(/Appellant) ()*यथ(/Respondent)
आयकर अपील सं./ITA No.1260/Chny/2015
नधा रण वष /Assessment Years: 2010-11
M/s. Bay Container Terminal Pvt. Asst. Commissioner of Income Tax,
Ltd., Company Circle-1(2),
No.21, Old No.18, Vs. Chennai.
Swami Sivananda Salai, Chepauk,
Chennai - 600 005
[PAN: AAACB 3622L]
(अपीलाथ(/Appellant) ()*यथ(/Respondent)
अपीलाथ( क+ ओर से/ Assessee by : Shri S. Sridhar, Advocate
Shri L. Shibi, C.A
)*यथ( क+ ओर से /Revenue by : Shri A.R.V. Sreenivasan, JCIT
सन
ु वाई क+ तार ख/Date of Hearing : 20.12.2018
घोषणा क+ तार ख /Date of Pronouncement : 04.03.2019
आदे श / O R D E R
PER INTURI RAMA RAO, ACCOUNTANT MEMBER:
These are the matters remanded back to this Tribunal for fresh consideration by Hon'ble High Court of Madras. ITA Nos.1214/Chny/2015, 642/Chny/2016, 2614/Chny/2017 & 1260/Chny/2015
:- 2 -:
2. The brief facts of the case are as under:
The appellant is a company incorporated under the provisions of the Companies Act, 1956 and it is engaged in the business of storage, handling and repairs of marine containers. The return of income for the AY 2010-11 was filed on 29.09.2010 and same was revised on 25.12.2010 at a total income of Rs. 1,10,90,812/-. Against the said return of income, the assessment was completed by Asst. CIT, Company Circle-I(2), Chennai vide order dated 28.03.2013 u/s. 143(3) of the Income Tax Act, 1961 (in short 'the Act') admitting total income of Rs.
5,78,00,385/-. While doing so, the AO made addition of Rs. 12,10,942/- invoking the provisions of s. 40(a)(i) of the Act on the ground that the appellant had failed to deduct TDS on the software purchases and also disallowed the claim for plot development expenditure of Rs. 4,29,93,011/- and disallowed the expenses on purchases of Rs. 25,05,619/-.
3. Being aggrieved by the above addition, an appeal was preferred before ld. CIT(A), who vide impugned order held that out of the expenses incurred on foreign exchange of Rs. 12,10,942/- a sum of Rs. 10,13,612/- pertaining to travelling expenses and the balance of Rs. 1,97,330/- represents towards electronic data interchange charges. The ld. CIT(A) held that the provisions of TDS were not applicable in respect of ITA Nos.1214/Chny/2015, 642/Chny/2016, 2614/Chny/2017 & 1260/Chny/2015 :- 3 -:
travelling expenditure of Rs. 10,13,612/- only on the balance amount of Rs. 1,97,330/- the action of AO was upheld. As regards, addition of plot development expenditure, the ld. CIT(A) after considering the breakup of the expenditure had directed the AO to treat the security charges of Rs. 69,12,521/- as revenue expenditure and on the balance amount of addition was confirmed the action of the AO allowing depreciation @ 5%. As regards addition of bogus purchases of Rs. 25,05,619/-, the ld. CIT(A) considering the fact that the appellant itself has paid the VAT on the said purchases and directed the AO to delete the addition. Being aggrieved, the appellant as well as Revenue filed appeals before this Tribunal, the Tribunal in ITA No.1214/Mds/2015 & 1260/Mds/2015 vide order dated 25.05.2016 the appeal of the Revenue was set aside to the file of AO for further inquiries as to the genuineness of the purchases made and as regards, the appeal of the assessee was dismissed. Being aggrieved by the order of the Tribunal, the assessee carried the matter to the Hon'ble High Court of Madras and the Hon'ble High Court vide order dated 21.02.2017 in ITA No.786/16 & 787 of 2016 set aside the matter to the Tribunal for fresh consideration. Thus, the present appeals were before us.
4. Now, we shall take up the assessee's appeal in ITA No.1260/Chny/2015 for assessment year (AY) 2010-11. ITA Nos.1214/Chny/2015, 642/Chny/2016, 2614/Chny/2017 & 1260/Chny/2015
:- 4 -:
5. We heard the rival submissions and perused the material on record. The assessee challenges the addition on account of disallowance of plot development expenditure holding to be capital and allowed depreciation @ 5%. It is contended that the expenditure was incurred on lease hold land and the expenditure is revenue in nature and the AO as well as ld. CIT(A) was not justified in holding the expenditure as capital in nature. From the perusal of the assessment order as well as the details filed, it appears that the lower authorities had not examined whether the expenditure has resulted into creation of asset nor looked into the nature of the expenditure therefore, in the absence of this material evidence on record, we remit back the issue to the file of the AO for fresh consideration for the purpose of examining the evidence in support of claim and decides the issue accordingly in accordance with law.
6. In the result, appeal filed by the assessee is partly allowed for statistical purposes.
Revenue's appeal in ITA No.1214/Chny/2015 for AY 2010-11:
7. The appeal of the Revenue does not survive before us as the Hon'ble High Court vide para 9 of the order had disposed of the matter by confirming the action of the Tribunal remanding the matter to the file of AO.
ITA Nos.1214/Chny/2015, 642/Chny/2016, 2614/Chny/2017 & 1260/Chny/2015
:- 5 -:
8. In the result, the appeal of the Revenue had become infructuous and dismissed as such.
Revenue's appeals in ITA Nos.642/Chny/2016 for AY 2011-12 & 2614/Chny/2017 for AY 2012-13:
9. These are the appeals filed by the Revenue contesting that the ld. CIT(A) ought not have allowed the plot revenue expenditure as revenue expenditure. The ld. CIT(A) considering the submissions made by the appellant held that the expenditure was incurred only towards maintenance / upkeep of the yard held that these expenses are only in the nature of revenue expenses such as cost of materials and sundry repairs and cost of yard leveling etc. and also considering the fact that these expenditure came to be allowed by the ld. CIT(A) for AY 2005-06 & 2008-09 revenue expenditure. On perusal of the ld. CIT(A) order, we do not find any infirmity in the reasoning of the ld. CIT(A) in allowing the same as revenue expenditure. In the circumstances, we do find any merit in the appeals filed by the Revenue.
10. In the result, the appeals filed by the Revenue are dismissed.
Order pronounced in the open Court on 4th March, 2019 in Chennai.
Sd/- Sd/-
(जॉज माथन) (इंटूर रामा राव)
(GEORGE MATHAN) (INTURI RAMA RAO)
या यक सद य/JUDICIAL MEMBER लेखा सद य/ACCOUNTANT MEMBER
चे नई/Chennai, 2दनांक/Dated: 4th March, 2019. EDN, Sr. P.S ITA Nos.1214/Chny/2015, 642/Chny/2016, 2614/Chny/2017 & 1260/Chny/2015 :- 6 -:
आदे श क+ ) त3ल4प अ5े4षत/Copy to:
1. अपीलाथ(/Appellant 4. आयकर आयु6त/CIT
2. )*यथ(/Respondent 5. 4वभागीय ) त न ध/DR
3. आयकर आयु6त (अपील)/CIT(A) 6. गाड फाईल/GF