M/S ASPEE SONS,BADDI vs DCIT, CIRCLE, PARWANOO

आदेश/Order

PER N.K. SAINI, VICE PRESIDENT This is an appeal by the assessee against the order dt. 26/12/2018 of the Ld. CIT(A), Shimla, H.P.

Following grounds have been raised in this appeal:

That on the facts, circumstances and legal position of the case, the Worthy CIT(A) in order dated 26.12.2018 has erred in passing that order in contravention of the provisions of S. 250(6) of the Income Tax Act, 1961.

2. That on law, facts and circumstances of the case, the Worthy CIT(A) has erred in confirming the action of Ld. AO wherein he had ordered for reduction of WDV of plant and Machinery by Rs. 27,79,174/- by thrusting additional depreciation on the appellant even when appellant had not claimed the, same and more-so when appellant's eligibility for such additional depreciation was never examined. 3. That on facts, circumstances and legal position of the case, Worthy CIT(A) was unjustified in holding that while computing eligible profits for deduction u/s 80IC, unclaimed additional depreciation on Plant & Machinery purchased during the year is to be reduced and said depreciation is not to be granted as deduction u/ s 32 even when the issue of additional depreciation could not have resulted into any additional taxable income and the entire exercise was only revenue neutral as held in assessee's own case for AY 2014-15 in dtd. 07.03.2019 and more-so when the Ld. AO has not done any addition of such type and the Worthy CIT(A) never raised such issue during appellate proceedings.

4. That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same.

During the course of hearing the Ld. Counsel for the Assessee at the very outset stated that an identical issue having similar facts was a subject matter of the assessee’s appeal in the preceding assessment year 2014-15 in wherein vide order dt. 07/03/2019 the issue has been decided in favour of the assessee and that in the subsequent year the Ld. CIT(A) by following the aforesaid order of the ITAT, SMC Bench, Chandigarh allowed the claim of the assessee, copy of the said order is placed at page no. 21 to 28 of the assessee’s paper book.

In her rival submissions the Ld. Sr. DR although supported the impugned order passed by the Ld. CIT(A) but could not controvert the aforesaid contention of the Ld. Counsel for the Assessee.

We have considered the submissions of both the parties and perused the material available on the record. In the present case it is noticed that an identical issue having similar facts has been adjudicated by the ITAT, SMC Bench, Chandigarh in assesse’s own case in for the A.Y. 2014-15 vide order dt. 07/03/2019 and the relevant findings have been given in para 8 & 9 which read as under:

I have considered the rival submissions of both the parties and carefully gone through the material available on record. It is noticed that an identical issue having similar facts has been decided in assessee's favour in the case of M/s Unison Pharmaceuticals, Baddi Vs DCIT, Circle, Parwanoo (supra) vide order dated 01.08.2018 wherein the relevant findings have been given in para 3 to 6 which read as under : 3. In this appeal, as per the contention raised, the assessee is mainly aggrieved by the action of the CIT(A) in upholding the addition on account of non-claim of additional depreciation and thereby reducing the eligible income of the assessee u/s 80IC of the Act as the above disallowances will go to add/reduce the business income of the assessee, which otherwise, is eligible for deduction u/s 80IC of the Act. The Ld. counsel for assessee has further stated it will not have any effect on the tax liability of the assessee. 4. The Ld. DR, on the other hand, has supported the order of the Ld. CIT(A).

5. We have considered the above submissions of the Ld. Counsel for assessee. So far as the addition made by the Assessing Officer in respect of addition made on account of claim of less depreciation is concerned, we find force in the contention of the Ld. counsel for assessee that the disallowance would add to the business income of the assessee, whereas, the addition made on account of claim of less depreciation will go on reducing the business income of the assessee, which otherwise, admittedly, is eligible for deduction u/s 80IC of the Act. In view of the above, the above stated disallowance cannot be exigible to taxation separately.

In view of the above the issues raised by the assessee vide ground Nos. 3 8s 4 of the appeal are decided with the observation that enhancement/addition into the income of the assessee on account of the aforesaid disallowances will not make the assessee liable to pay the additional tax, rather it will increase/decrease of the business income of the assessee, which otherwise, is eligible for deduction u/s 80IC of the Act. The AO is directed to follow the above directions. Therefore, the ground Nos. 3 & 4 raised by the assessee are accordingly, allowed in above terms.” 9. So, respectfully following the aforesaid referred to order dated 01.08.2018 in the case of M/s Unison Pharmaceuticals, Baddi Vs DCIT, Circle, Parwanoo in ITA 472/CHD/2018 for the assessment year 2012-13, the addition made by the AO and sustained by the ld. CIT(A) is deleted. 6. So respectfully following the aforesaid referred to order dt. 07/03/2019 in assesee’s own case the impugned addition made by the A.O. and sustained by the Ld. CIT(A) is deleted.

In the result, appeal of Assessee is allowed.

(Order pronounced in the open Court on 03/12/2020 )

M/S ASPEE SONS,BADDI vs. DCIT, CIRCLE, PARWANOO