DCIT, BK. CIRCLE, PALANPUR vs. M/S. BANASKANTHA DISTRICT OIL SEEDS GROWERS UNION LTD., PALANPUR

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ITA 1674/AHD/2017Status: DisposedITAT Ahmedabad13 February 2019AY 2013-144 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that unabsorbed depreciation available on April 1, 2002, is governed by Section 32(2) as amended by the Finance Act, 2001, and can be carried forward and set off without any time limit. The Tribunal followed its co-ordinate bench's decision on identical facts.

What were the facts?

The revenue appealed against the CIT(A)'s order allowing the assessee's claim for unabsorbed depreciation from AY 2000-01. The Assessing Officer had disallowed this claim, stating it was beyond the 8-year limit under Section 32(2).

What were the issues?

Whether unabsorbed depreciation can be carried forward and set off beyond the 8-year limit as per Section 32(2) of the Income Tax Act.

Which sections of the Income-tax Act were involved?

Section 32(2)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “B” BENCH

Before: Shri Rajpal Yadav & Shri Amarjit Singh

For Appellant: Shri Sulabh Padshah, A.R
For Respondent: Shri Mudit Nagpal, Sr. D.R, Shri Sulabh Padshah, A.R

PER : AMARJIT SINGH, ACCOUNTANT MEMBER:-

This revenue’s appeal for A.Y. 2013-14, arises from order of the CIT(A)-4, Ahmedabad dated 07-04-2017, in proceedings under section 143(3) of the Income Tax Act, 1961; in short “the Act”.

I.T.A No. 1674/Ahd/2017 A.Y. 2013-14 Page No 2 DCIT vs. M/s. Banaskantha Dist. Oil Seeds Growers’ Union Ltd.

2.

The solitary ground of appeal of the revenue is against the order of ld. CIT(A) in allowing the unabsorbed depreciation claim of Rs. 41,27,25,500/- pertaining to assessment year 2000-01 beyond 8 years as per provisions of section 32(2) of the act. The assessee has filed return of income on 29th October, 2013 declaring total income at Rs. nil after setting off of brought forward business losses to the extent of profit and gain from business for the year under consideration. The assessment u/s. 143(3) of the act was completed on 22nd March, 2016 and the assessing officer had disallowed the claim of the assessee for carry forward of unabsorbed depreciation of Rs. 41,27,25,500/- pertaining to assessment year 2000-01 and earlier years.

3.

Aggrieved assessee has filed appeal before the ld. CIT(A). The ld. CIT(A) has allowed the appeal of the assessee after following the decision of Hon’ble Gujarat High Court of Gujarat in the case of General Motors India

4.

We have heard the rival contentions and perused the material on record carefully. During the course of appellate proceedings before us the ld. counsel has brought to our notice that Co-ordinate Bench of the ITAT in the case of the assessee itself vide ITA No. 1993/Ahd/2016 has adjudicated the identical issue on similar facts in favour of the assessee. With the assistance of ld. counsel we have gone through the aforesaid decision of the Co-ordinate Bench. Relevant part of decision is reproduced as under:- “6. We have heard rival contentions and perused the material on material carefully. We have noticed that the Co-ordinate Bench of ITAT Ahmedabad vide ITA No. 2393/Ahd/2013 dated 03-05-2017 in the case of Gujarat Lease Finance Ltd has decided the identical issue in favour of assessee. The part of the judicial findings and the principles laid down by the Hon’ble Jurisdictional High Court in the case of General Motors India(P) Ltd are reproduced here as under :-

I.T.A No. 1674/Ahd/2017 A.Y. 2013-14 Page No 3 DCIT vs. M/s. Banaskantha Dist. Oil Seeds Growers’ Union Ltd.

“We are of the considered opinion that any unabsorbed depreciation available to an assessee on 1st day of April 2002 (A.Y. 2002-03) will be dealt with in accordance with the provisions of section 32(2) as amended by Finance Act, 2001. And once the Circular No. 14 of 2001 clarified that the restriction of 8 years for carry forward and set off of unabsorbed depreciation had been dispensed with, the unabsorbed depreciation from A.Y. 1997-98 upto the A.Y. 2001-02 got carried forward to the assessment year 2002-03 and became part thereof, it came to be governed by the provisions of section 32(2) as amended by Finance Act, 2001 and were available for carry forward and set off against the profits and gains of subsequent years, without any limit whatsoever.” The relevant part of the decision of the Co-ordinate Bench of the ITAT decided in the case of Gujarat Lease Finance Ltd. vide ITA No. 2393/Ahd/2013 dated 03/05/2017 is reproduced as hereunder:- “6. We have heard the rival contentions. We have also perused the judicial pronouncement delivered by the Hon’ble High Court of Gujarat in the case of General Motors India (P.) Ltd vs. DCIT (2012) 25 taxmann.com which was elaborated in detail by the Ld. CIT(A) in his order as supra in this order. We have also perused the judicial pronouncement of Hon’ble Gujarat High Court in the case of CIT vs. Gujarat Themis Biosyn Ltd. [2014] 44 taxmann. com 204 (Gujarat) in which after considering the judgment given in General Motors India (P) Ltd, it was held that carry forward of unabsorbed depreciation concerning impugned assessment years could be set off in subsequent years without any set time limit. In view of the above judicial pronouncement on the issue and the elaborate findings of the ld. CIT(A), we do not find any reason to interfere in the decision of the ld. CIT(A).”

Respectfully following the decision of the Co-ordinate Bench as supra, we do not find any error in the finding of ld. CIT(A), therefore, the appeal of the revenue is dismissed. In the result, both the appeals of the revenue are dismissed.”

5.

Respectfully following the decision of the Co-ordinate Bench as supra, we do not find any infirmity in the decision of ld. CIT(A), therefore, the appeal of the revenue is dismissed.

6.

In the result, the appeal of the revenue is dismissed.

Order pronounced in the open court on 13-02-2019 (RAJPAL YADAV) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad : Dated 13/02/2019

I.T.A No. 1674/Ahd/2017 A.Y. 2013-14 Page No 4 DCIT vs. M/s. Banaskantha Dist. Oil Seeds Growers’ Union Ltd.

आदेश क" ""त"ल"प अ"े"षत / Copy of Order Forwarded to:-

1.

Assessee

2.

Revenue

3.

Concerned CIT

4.

CIT (A)

5.

DR, ITAT, Ahmedabad

6.

Guard file. By order/आदेश से, उप/सहायक पंजीकार आयकर अपील"य अ"धकरण, अहमदाबाद

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