Income Tax Appellate Tribunal - Mumbai
Dcit Rg 10(1), Mumbai vs Maharashtra State Electricity ... on 10 March, 2017
आयकर अपीलीय अिधकरण, अिधकरण, मुब ं ई "बी"
बी" खंडपीठ मे Income-tax Appellate Tribunal -"B"Bench Mumbai ,,लेखा सद य एवं अमरजीत सह, सव ी राजे सह, याियक सद य Before S/Sh.Rajendra,Accountant Member and Amarjit Singh,Judicial Member आयकर अपील सं./I.T.A./419/Mum/2010, िनधा रण वष /Assess ment Year:2006-07 DCIT, Range-10(1) M/s. Maharashtra State Electricity Room No.455, Aayakar Bhavan Transmission Co.Ltd.
M K Road, Plot No.C-19, E-Block
Vs.
Mumbai-400 020 Prakashganga, Anant Kanekar Marg,
Station Road, Bandra (E),Mumbai-51.
PAN:AAECM 2936 N
(अपीलाथ /Appellant) ( यथ / Respondent)
राज व क ओर से / Revenue by: Shri N.P. Singh-CIT-DR
अपीलाथ
क ओर से /Assessee by: S/Shri S.E. Dastur and Neeraj Sheth
सुनवाई क तारीख / Date of Hearing: 14/12/2016
घोषणा क तारीख / Date of Pronouncement: 10.03.2017
लेखा सद य राजे के अनुसार PER RAJENDRA, AM-
Challenging the order,dated13.11.2009 of the CIT(A)-21,Mumbai,the Assessing Officer(AO) has filed present appeal.Assessee-company,engaged in the business of electricity transmit - ssion,filed its return of income on 29.11.2006 declaring Nil income after set off of brought forward business losses and unabsorbed depreciation.A revised return was filed on 27.10. 2007,declaring Nil income after set off of brought forward losses.The AO completed the assessment u/s.143(3) of the Act, on 31.12.2008 ,determining income of the assessee at Rs.538.54 crores.
Brief Facts:
2.The Maharashtra State electricity Board (MSEB)was engaged in the business of generation, transmission and distribution of power for the State of Maharashtra. The MSEB w.e.f. 06. 06.
2005 was trifurcated into three companies viz. M.S.E. Generation Co. (MSEGC), M.S.E. Transmission (MSET) and M.S.E.Distribution Co.Ltd.(MSEDCL). Each of the newly formed companies took over the activity/business of MSEB as its business activity.The assessee company took over Transmission activity of MSEB .
During assessment proceedings,the AO noticed that in the original as well as revised return, the total income, before set off of b/f losses had been reduced from Rs. 536,22,64,112/- as per original return to Rs. 533,57,51,543/- in the revised return. A.O was of the opinion that the difference of Rs.2,65,12,569/- in the total income, prior to set off of losses, as per original and revised return, was not reconciled by the appellant company.He observed that during the course of assessment proceedings, sufficient opportunities were provided to the 419/M/10(06-07) MSETransmission Co.Ltd.
assessee to explain and substantiate the claims made in the returns filed by the assessee,that the issue was not explained nor was any plausible reconciliation of the difference was submitted.The AO further noticed that the computation forming part of the return showed that the deprecation claimed had been increased and the addition on account of adjustments u/s. 28 to 44 had been reduced in the revised return,that the reasons for the same were not explained.
2.1.With regard to the revised return the AO observed that the assessee was entitled to revise return u/s. 139(5) of the Act,that such revision had to be based on any omission or any wrong statement discovered in such return,that any wrong statement or omission was discovered by the assessee for which the revised return was furnished.He held that in absence of any material evidence or details, the said reduction in the total income was irregular and unsubstantiated.In the facts and circumstances,the difference of Rs. 2,65,12,569/- in the original and revised return was added by the AO to the total income of the assessee.
2.2.Aggrieved by the order of the AO,the assessee preferred an appeal before the First Appellate Authority(FAA).During appellate proceedings,it was argued that the assessee one of the successor companies to the erstwhile MSEB and was incorporated on 31-05-2005,that the original return was filed on 29-11-06, declaring total income at Rs. -nil-, after setting off of a sum of Rs. 536.22 crores against the b/f loses and unabsorbed deprecation of MSEB, available to the appellant company in terms of section 72A(4) of the Act,that the original return was prepared on the basis of provisional accounts and a Tax Audit Report,dated 22- 11-2006,that Subsequently, a revised return of income was filed on 27-10-2007, declaring total income of Rs. -nil-,after setting off of a sum of Rs. 533.57 crores against the available b/f losses and deprecation of MSEB,that the revised return was prepared on the basis of audited accounts and the revised Tax Audit Report dated 04-10-2007,that during the course of assessment proceedings, the AO called upon the assessee to furnish details of justification for filing two returns, that the assessee vide letter dated 27-10-08 furnished to the AO the statement of accounts, statement showing computation of total income in respect of original as well as revised return and also tax audit report, dated 4-10-07,that during assessment proceedings no further requisition in respect thereof were raised by the AO,that he did not make any effort to even go through those basic documents filed before him / available with him and instead proceeded to make addition of Rs. 2.65 crores,that the original return was substituted by the revised return, that various documents filed by the appellant had been lost 2 419/M/10(06-07) MSETransmission Co.Ltd.
sight off by the A.O such as statement showing computation of total income of the original and the revised return, copy of original and revised return which included complete details of unaudited and audited revenue accounts and tax audit report prepared on the basis thereof,that the exact reconciliation of the difference between the income (prior to set off of losses )as per the original and revised return was not furnished,that complete figures in respect thereof were on record.
2.2.a.Before the FAA,the assessee explained the reconciliation/difference between the original and revised return as under:
A.Other income:
i.Compensation paid on accidental death of an employee Rs.2,50,386/ recovered from Govt. of Maharashtra.
ii.Interest and financial charges - excess provision made in respect of interest accrued and due for loans - withdrawn - Rs. 46,44,1681- (comprising of three figures of Rs. 280653/-, Rs. 1859349/- & Rs.25,04,166/- ) iii.Interest and financial charges capitalize -Rs.5,98,770/- B.Other debits - Expenses:
i.Negative material cost variances - Rs. 1,86,27,663/- . ii.Loss on exchange variation - Rs. 1,09,21,726/-
iii.Loss on settlement of claim for material- Rs. 2,84,537/-. iv.Compensation for injuries / death and damages to outsiders - Rs. 25,136/-. v.Loss on obsolescence of fixed assets - Rs. 28,920/- f.Intangible assets written off - Rs. 2,531/-
vi.Interest charges for HVDC project written off - Rs. 10,08,573/-. vii.Rounding off - Rs. 38/-.
On the basis of above reconciliation,the assessee argued that there was no difference between returned income as per the original return of income and as per the revised return of income which was not explainable.
After considering the available material,the FAA held that the income of both the returns was computed at Rs. -NIL- after adjusting the above said declared income against the brought forward unabsorbed losses /depreciation of MSEB,that the original return was filed on 29.11.2006,that the assessee could have filed revised return by 27.10.2007,that the revised return filed on 02-08-07 was well within time,that as per provisions of section 139(5), a person couln revise the return if he would discover any omission or any wrong statement in the original return,that there was no dispute that the original return was filed by the assessee on the basis of provisional unaudited accounts,that the assessee-company being one of the 3 419/M/10(06-07) MSETransmission Co.Ltd.
trifurcated company inherited part of huge / voluminous records / accounts / other problems of parent company,that there were valid reasons for non-completion of appellant's accounts till the due date of filing of the return of income,that it received statutory audit report u/s. 44AB of the Act of the auditors on the basis of which the revised return was filed,that it's income as per the provisional unaudited accounts was at Rs. 536.22 crores, whereas income as per audited accounts was at Rs. 533.57 crores.that there was a difference of Rs. 2.65 crores,that such difference was on account of material changes in various items of income and expenditure, that the AO himself,in para 5.2 of assessment order,had stated that the computation forming part of the e-filed return showed that the deprecation claims had been increased and the addition on account of adjustment u/s. 28 to 44 had been reduced in the revised return,that such difference in the income /expenses constituted discovery of omission or wrong statement in the original return within the meaning of section 139(5) of the Act,that there was a valid and justified reason for the appellant for revising the return,that the AO was not justified in holding that the assessee had failed to prove discovery of any omission or wrong statement in the original returntht once the valid revised return was filed, the original return stood as withdrawn,that the AO should have assessed the income on the basis of revised return only.
With regard to disallowance of the difference of Rs. 2.65 crores in original and revised return, the FAA held that during appellate proceedings, the appellant filed copies of original return as well as revised returns,and exact details of difference / reconciliation between the original and revised return,that during assessment proceedings, no specific question was raised by the AO for explaining the difference.In respect of items of income, that was offered by the assessee in revised return,the FAA observed that same needed no comments.He further observed that the item of material cost variance at Rs. 1,86,27,663/- was wrongly transferred to reserve account,that after pointing out by Auditors the same was correctly transferred to material cost variance,that the second major item i.e. loss on exchange variation of Rs. 1,09, 21,7261- was also allowable,that claim of loss on settlement of claim for martial of Rs. 2, 84,537/- was also made in original unaudited accounts and that same was an allowable item,that the last major item of reconciliation was interest charges for HVDC project written off,that it was a genuine error which was made in the unaudited accounts and had been corrected when it was pointed out by the auditors,that the other item of reconciliation were of minor amount,that all the items forming part of reconciliation were of allowable nature. Finally,he held that original return was revised for valid reasons,that the AO was not justified 4 419/M/10(06-07) MSETransmission Co.Ltd.
in making addition of Rs. 2,65,12,569/-holding that the difference between original and revised return was not explained.
3.First Ground of appeal is about admitting the additional evidences in violation of Rule 46A of the Income Tax Rules,1962 (Rules). As stated earlier,during the appellate proceedings,the assessee had furnished statement giving therein a reconciliation of the total income as per original and revised return.Since this statement was not called upon by AO,the same constituted additional evidence in terms of Rule 46A of the I.T.Rules.The assessee requested for admission of additional evidence.
It was argued before the FAA that there was no difference between the returned income as per the original return of income and as per the revised return of income.The FAA forwarded the additional evidences to the AO as per the provisions of Rule 46A of the Rules and directed him to furnish comments on the evidences produced by the assessee.Vide his letter,dated 21/08/2009, the AO objected admission of additional evidences on the ground the assessee was given adequate opportunity to explain the discrepancies in the revised and the original return of income,that it should have furnish the reconciliation statement along with the necessary supporting evidences during the course of assessment proceedings.Vide its reply dated 09/11/2009, the assessee furnished comments on the remand report of the AO. After considering the available material,the FAA held that the assessee had filed the details of difference/reconciliation between the original and the revised returns, that during the assessment proceedings the AO had not raised any specific question about the difference in the original and the revised returns, that the AO had not directed the assessee to file reconciliation, that the argument advanced by the AO that during assessment proceedings proper and illegitimate of budgetary was afforded to the assessee was not correct, that the case of the assessee was covered by clause (c) and clause (d) of the Rule 46A of the Rules.
3.1.During the course of hearing before us,the Departmental Representative (DR) stated that matter could be decided on merits.The Authorised Representative (AR) stated that at the time of filing of original return audited accounts were not available, that later on revised return was filed, that the AO did not raise any specific query in that regard, that he made an addition of Rs. 2.65 crores to the income of the assessee on account of difference between the two returns, that the assessee filed a reconciliation statement before the FAA, that a remand report was called from the AO and the issue was decided accordingly.
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3.2.We have heard the rival submissions and perused the material before us.We find that the assessee had filed a revised return after receiving audited accounts from the competent authority, that the AO had made certain addition to the total income of the assessee as he was of the opinion that there was difference between the original and the revised return, that the assessee had filed a reconciliation statement during the appellate proceedings, that the AO was given an opportunity to offer his comments about the additional evidences. As per the provisions of Rule 46A, the FAA is supposed to afford a reasonable opportunity of hearing to the AO if he admits additional evidences. Under clause (d), he can suo-motu admit additional evidences.He has invoked the provisions of clauses c and d of the Rule. Once the AO was given a chance to rebut the evidences produced by the assessee, there was no justification for raising the ground of admitting additional evidences by him. As the FAA has followed the procedure has laid down by law, so, we dismiss the first ground,raised by the AO.
4.Second Ground of appeal is about allowing relief in respect of claim of reversal of excess interest capitalised,amounting to Rs. 5.89 lakhs.During the appellate proceedings,the assessee produced additional evidences before the FAA,as stated earlier. In the written submissions the assessee explained the reasons for difference between the original and the revised return. It was stated that under the head other income interest and financial charges amounting to Rs. 5,98,700/- were wrongly capitalised,that in the audited account interest charges were rightly claimed as revenue expenditure. As the claim made by the assessee was in form of additional evidence, the FAA forwarded the reconciliation statement to the AO for his comments. In his reply, the AO objected to admission of additional evidences, but, did not offer any comment about the amounts shown in the statement under the heads 'Other Income' and 'Other Debits
- Expenses'. The FAA after considering the available material, held that the claim made by the assessee was as per rule.
4.1.During the course of hearing before us,the DR stated that assessee itself had capitalised the disputed amount in the original return. The AR contended that the original return was based on unaudited accounts,that the auditors pointed out amount in question was expendi - ture of revenue nature, that interest was not paid for any capital asset, that the FAA had rightly allowed the claim.
4.2.We find that in the original return the assessee had capitalised the interest and financial charges, that in the revised return the expenditure was claimed under the head revenue expenditure,that the AO had not commented upon the claim made by the assessee while filing the remand report,that he had not brought any evidence on record to prove that expenditure 6 419/M/10(06-07) MSETransmission Co.Ltd.
was of capital nature.In the circumstances, we are of the opinion that the order of the FAA does not suffer from any legal or factual infirmity. Confirming his order, we dismiss second ground of appeal.
5.Next Ground is about allowing the claim regarding material cost variance (Rs.1.86 crores) and exchange rate variance(Rs.1.09crores)in the revised return. In its reconciliation statement the assessee, under the head other debits -expenses mentioned the above referred to amounts and claimed the same as expenditure incurred during the year under consideration. As the claim made by the assessee was part of the additional evidences produced by it before the FAA,so, he called for report from the AO.In his report, the AO did not offer any comment about the said expenses. As the expenditure was certified by the auditor,so, the FAA allowed the same.
5.1.Before us,the DR advanced the same arguments that were argued for last ground of appeal.The AR supported the order of the FAA. We have already discussed the issues of furnishing of additional evidences,calling for remand report by the FAA, offering of no comments by the AO in the report about the various items of income/expenditure. As the claim of the assessee is supported by the audited accounts, therefore, there is no justification in not allowing the expenditure under both the heads. We decide third ground of appeal against the AO.
6.Writing off of claim pertaining to a theft in the year 1995, as the subject matter of next ground of appeal. The erstwhile company i.e. MSEB had suffered a loss of Rs.2.84 lakhs on account of loss on settlement of claims.The facts and circumstances of the said expenditure are same as the earlier to expenses, mentioned in the earlier paragraphs. 6.1.Following our order,we hold that FAA was justified in allowing the expenditure as per the reconciliation statement filed,as the amount in question was actually written off in the books of accounts.Ground number four is decided against the AO.
7.Next Ground is about allowing the claim regarding loss on pursuance of fixed assets and intangible assets amounting to Rs.28,920/-. In the audited accounts the said amount was claimed under the head allowable expenses. During the course of hearing before the FAA the assessee considered that disputed amount was not allowable (page 10 of the paper book). However,he allowed the claim made by the assessee, as it was also part of the reconciliation statement.
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7.1.We find that the assessee itself had stated that amount in question was not allowable. Therefore, in our opinion,the FAA was not justified in allowing the claim. Reversing his order, we decide ground number five in favour of the AO.
8.Next three grounds (GOA-6to8) deal with High Voltage Direct Current (HVDC) project. During the assessment proceedings the AO found that the assessee had incurred the cost of insuring the project which was yet to be capitalised in the books of accounts, that the amount in question was Rs. 89.44 lakhs. He held that assessee had not capitalised the expenditure so claim made by it under the head revenue expenditure could not be allowed. He made an addition of Rs. 89, 44, 174 to the total income of the assessee. He further found that the assessee had incurred an expenditure of Rs. 95.80 lakhs on lease rentals of HDVC projects. As the expenditure on lease rentals was not capitalized,so, he disallowed the claim made by the assessee. Similarly an expense of Rs. 3.83 lakhs and 41.95 lakhs claim under the heads taxes and charges were disallowed by the AO is the expenditure was not capitalised/it pertained to capital assets.
8.1.Aggrieved by the order of the AO,the assessee preferred an appeal before the FAA.Before him,it was argued that the project had already been commission,that disallowance is were made without any discussion with the assessee,that the HDVC project was commenced by MSEB on 13/11/1998 and was transferred to the assessee, that the project was an existing unit, that the AO had ignored the schedule F to the scheme of unbundling, that the assessee were transferred from BHEL to MSEB on 13/11/1998, that the expenditure of Rs. 89.44 lakhs pertain to the insurance charges for the project for the period 01/10/2005 to 30/09/2006. During the appellate proceedings, the assessee filed a copy of these agreement dated 21/05/ 1997 and office notes dated 28/04/1999 and 25/05/1999 to substantiate the claim that as HDVC project was not a new one and was existing since last for many years. It was stated that these documents were not submitted before the AO is he did not call for the same. The assessee also filed copies of Journal vouchers evidencing the payment of lease rentals and taxes for the project. It was stated that all the documents should be admitted as additional evidences. The FAA forwarded the documents to the AO and directed to file a remand report. In his report the AO stated that assessee had not furnished any evidence regarding payment of Rs. 89.44 lakhs, 95.80 lakhs and Rs. 3.83 lakhs under the heads insurance expenditure, please rentals and taxes/charges respectively,that 50% of the insurance charges pertained to subsequent assessment year.
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After considering the available material,the FAA held that the project was an existing project/ unit of erstwhile company, that it commenced in the year 1998, that the above-mentioned three expenses were not required to be capitalised, that same were to be allowed as revenue expenses,that half of the insurance charges (44.72 lakhs) pertain to subsequent year, that same was not allowable in the year under consideration. Finally he partly allowed the appeal of the assessee.
8.1.During the course of hearing before us, the DR stated that matter could be decided on merits.The AR supported the order of the FAA and referred to page 246 of the PB.
8.2.We have heard the rival submissions and perused the material. We find that the project was commissioned in the year 1998, that the machinery was purchased by the erstwhile company, that on trifurcation of MSEB the project was handed over to assessee, that the expenses incurred by the assessee were for running the project, that the FAA had disallowed 50% of the expenditure incurred under the head insurance expenses.We are unable to understand as to how the AO is at the conclusion that project was a new project and the expenses were to be capitalized. We do not see any infirmity in the order of the FAA. So, confirming his order we dismiss all the three grounds(GOA-6,7,&8).
9.Ninth ground deals with deleting the addition of Ruby 70,000/-in respect of the electricity duty.During the assessment proceedings, the AO found that the assessee had shown a liability on account of electricity duty to the tune of Rs. 70,000/- as on 31/03/2006, that the duty was collected but was not paid to the government agencies. He held that provisions of section 43B were applicable to the amount in question, that the assessee had not produced any proof of payment of the disputed amount on or before the due date of filing of returns of income.Referring to the judgment of Chowranghee Sales Bureau(222 ITR 344), the AO made an addition of Ruby 70,000/-to the income of the assessee.
9.1.Before the FAA,during the appellate proceedings, the assessee argued that the financial statements were prepared in format prescribed under Electricity Supply Annual Accounts Rules,1985,that the disputed amount represented inspection charges payable to the govern - ment for electrical inspection of substations and was disclosed accordingly under the aforesaid heading, that during the assessment proceedings it was brought to the notice of the AO that the amount in question did not consist electricity duty and that same were inspection charges.
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The FAA,after considering the available material, held that payment made by the assessee was on account of inspection charges, that same was allowable as revenue expenditure, that the same was outside the purview of section 43B of the Act. Finally, he deleted the addition made by the AO.
9.2.Before us, the DR stated that no evidence was produced before the AO. The AR supported the order of the FAA.
9.3.We find that the charges paid by the assessee were inspection -charges (page 183 of the paper book).The assessee had paid the inspection charges to the electrical Department, Government of Maharashtra. Therefore, in our opinion, same could not be treated as duty and hence provisions of section 43B cannot be invoked.Confirming the order of the FAA, we decide ninth ground against the AO.
10.Last ground of appeal is about allowing the claim of set off of brought forward losses/ unabsorbed depreciation. During the assessment proceedings, the AO rejected the claim of the assessee of setting off of brought forward losses/depreciation on the ground that impugned brought forward /loss/depreciation did not belong to the assessee but belong to the erstwhile MSEB.
10.1.We find that identical issue was decided by the tribunal while adjudicating the appeal for the assessment year 2006-07(ITA/762/Mum/2010,dated 12/08/2015). We are reproducing the relevant portion of the order and it reads as under:
""Ground No.4 deals with the grievance of the revenue regarding action of Ld. CIT(A)in allowing the claim of set off of brought forward/lost/ unabsorbed depreciation.The assessing officer has discussed this issue at para-15.1to 15.3 on page number 4 to 5 of the assessment order. The Ld. AO has rejected the claim of the assessee of set off of brought forward / loss/depreciation on the ground that the impugned brought forward/ loss/ depreciation does not belong to the assessee company but belong to erstwhile Maharashtra State Electricity Board (MSEB) which was trifurcated into three companies i.e. for generation, transmission and distribution.The assessee company being one of these three companies. In other words the assessee company was demerged out of erstwhile MSEB. The assessee company made this claim on the basis of a chart showing the brought forward losses and unabsorbed depreciation from 1990-1999 onwards belonging to aforesaid MSEB.The assessee company made the claim in terms of section 72(A)(4) of the Income Tax Act 1961. It was further claimed by the assessee that business loss and unabsorbed depreciation of MSEB has been apportioned to the assessee company (1/3rd share) and the same was set off against the total income of the impugned year and the balance amount was carried forward for set off against income of subsequent years.The Ld. AO denied the claim for set off of brought forward business loss and unabsorbed depreciation due to the following reasons:10
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(i)The basis of apportionment of the said losses among the three trifurcated entities of MSEB is not explained.
(ii) The figures of losses submitted are based on the returns filed by MSEB, but the assessed losses are not reported by the assessee company.
(iii) The petition claimed to have been made before the CBDT is still pending and no approval has been granted.
(iv) The assessee company has claimed demerger from the original entity i.e. MSEB. However, the said demerger has not been proved by it for which the onus was on itself.
(v) The eligibility of the assessee company to claim set off and carry forward of the brought forward losses of M/ s.MSEB is not established.
(vi) The information relating to the trifurcation of carried forward assessed loss was also not given.
(vii) The assessment order for the AY 2006-07 has been passed in the case of M/ s MSEB.
The total income is computed at NIL after set-off of brought forward losses/ unabsorbed depreciation to the extent of income available i.e. Rs.838,65,23, 1291 -. However, neither any details of balance loss allowed to be carried forward nor any chart of apportionment of the said loss to the trifurcated entities are mentioned therein.
15. The issue was cont ested by the assessee company before Ld. CIT(A) and Ld.CIT(A) allowed the claim of the assessee by passing s pe aki ng or der an d t h e r el e va nt di s c us s i on wa s m ade by t he Ld . CIT(A) in para 15.1 to 15.3 on page 29 to 34 of the appellate order. The relevant operative para of the Ld. CIT(A) is reproduced below for ready reference:
15.3 (i) pg-13 .... scan attach 15.3(i) To conclude, it is held that the demerger of MSEB and trifurcation into three new entitles, including that of appellant was proved before A.O during assessment proceedings itself. Therefore, in terms of section 72A( 4) r. w.s. 2(19AA) of the Act, the appellant was entitled for benefit of set off of balance b/f. losses / depreciation of MSEB against its income.
The A O. is directed to allow appellant's claim after verifying the facts in the case of MSEB. The year under consideration was last assessment year of MSEB and the first year of the appellant company. In case of MSEB, the figures of unabsorbed losses / depreciation of various years will go on changing on receipt of orders of appellate authorities, which will have bearings on the last assessment order of the MSEB and consequently on the first assessment year under consideration of the appellant. The AO is directed to ascertain the fact of unabsorbed losses / deprecation in case of MSEB from time to time and allow the benefit of carry forward of the same in the. hands of appellant for the year under consideration. Subject to' this observation, this ground of appeal is allowed.
16. Before us, both the parties argued this issue vehemently. Ld. DR relied upon the assessment order and submitted that the claim has been rightly rejected by the AO. On the other hand Ld. Counsel of the assessee has submitted that Ld. CIT(A) has rightly allowed the claim after considering all the facts and circumstances and correct position of law and further submitted that in any case vide subsequent years the AO has hi mself allowed the set off of brought forward business loss/unabsorbed depreciat ion to the assessee company being vide following orders:
"i Order dated Nil passed u/s.143(3) r.w.s. 263 of the Income tax, Act 1961 for the Assessment year 2006-07- refer page No.06 to 07 or of the compilation.11
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ii. Order dated 10 March 2010 passed u/s.154 of the Income tax, Act 1961 for the assessment year 2007-08- refer page nos.08 to 09 of the compilation iii. Order dated 16 March 2011 passed u/s.154 of the Income tax, Act 1961 for the Assessment Year 2007-08 refer page no.11 of the compilation iv. Order dated 02 May 2011 passed u/s.154 of the Income-tax Act 1961 for the Assessment Year 2007-08 -- refer page no.13 of the compilation.
17.We have considered arguments of both sides and material placed before us for our consideration.It is seen that the AO has himself allowed this claim to the assessee in subsequent years. The Ld. CIT(A) has passed speaking order and the reasoning given by Ld.CIT(A)in allowing this claim is justified and does not need any interference of o u r p a r t . F u r t h e r , L d . C I T ( A ) h a s a l l o w e d t h i s c l a i m s u b j e c t t o verification by the AO to ascertain the correct fact before allowing this claim. Under these circumstances we do not find if any prejudice would be caused to the revenue.In view of the above ground no.4 of the revenue being devoid of merits is hereby dismissed."
Respectfully, following the above order,we decide the last ground of appeal against the AO.However, he should make the verification with regard to the claim made b y the assessee and as observed by the Tribunal in the order for the earlier AY.
As a result, appeal filed by the AO stands partly allowed.
फलतः िनधा रती अिधकारी ारा दािखल क गई अपील अंशतःमंजूर क जाती है.
Order pronounced in the open court on 10th March, 2017.
आदेश क घोषणा खुले
यायालय म दनांक 10 माच , 2017 को क गई ।
(अमरजीत !सह / Amarjit Singh ) (राजे$% / Rajendra)
Sd/- Sd/-
$याियक सद य / JUDICIAL MEMBER लेखा सद य / ACCOUNTANT MEMBER
मुंबई Mumbai; दनांक/Dated : 10.03.2017.
Jv.Sr.PS.
आदेश क ितिलिप अ ेिषत/Copy of the Order forwarded to :
1.Appellant /अपीलाथ 2. Respondent /
यथ
3.The concerned CIT(A)/संब अपीलीय आयकर आयु , 4.The concerned CIT /संब आयकर आयु
5.DR " " Bench, ITAT, Mumbai /िवभागीय ितिनिध, खंडपीठ,आ.अ. याया.मुंबई
6.Guard File/गाड फाईल स यािपत ित //True Copy// आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार Dy./Asst. Registrar आयकर अपीलीय अिधकरण, मुंबई /ITAT, Mumbai.
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