THE COMMISSIONER OF INCOME TAX vs. M/S.HOTEL ROYALE PARK

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ITA/260/2015HC KeralaKLHC01025661201522 November 2016Bench: HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN,HONOURABLE MR.JUSTICE THOTTATHIL B.RADHAKRISHNAN4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala, in its judgment dated November 22, 2016, did not provide a specific finding or reasoning on the merits of the appeal. The judgment states that the appeal was finally heard along with another appeal (ITA No. 272/2015). However, the operative part of the judgment, detailing what the court decided, is not included in the provided text. Therefore, it is not possible to ascertain the Tribunal's decision, the reasoning, the ratio decidendi, or the operative directions. No issue was expressly left undecided as the outcome of the appeal is not recorded.

What were the facts?

This is an appeal by the Revenue against an order of the Income Tax Appellate Tribunal (ITAT), Cochin Bench, dated May 7, 2015. The appeal pertains to Assessment Year 2006-07. The order under challenge is ITA No. 602/Coch/2013. The assessee is M/s. Hotel Royale Park, located in Kochi. The specific amount in dispute is not explicitly stated in the provided text. The procedural history involves the ITAT's decision, which is now being appealed by the Commissioner of Income Tax (Central), Kochi.

What were the issues?

1. Whether the Tribunal erred in holding that the assessee was entitled to claim depreciation on the assets of the hotel business, despite the hotel business being transferred to a partnership firm? Assessee's Contention: The assessee likely argued that depreciation is an allowable deduction on assets used for business purposes, irrespective of the business structure, as long as the assessee continues to own the assets and they are used for earning income. They may have relied on established principles of depreciation allowance under the Income Tax Act. Revenue's Contention: The Revenue likely contended that once the business was transferred to a partnership firm, the assessee (as an individual or proprietary concern) ceased to be the owner and operator of the business, and therefore, could not claim depreciation on assets that were no longer part of their business. They might have argued that the depreciation should be claimed by the partnership firm. The specific provisions or case law relied upon by either party are not detailed in the provided text.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE THOTTATHIL B.RADHAKRISHNAN & THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN TUESDAY, THE 22ND DAY OF NOVEMBER 2016/1ST AGRAHAYANA, 1938 ITA.No. 260 of 2015 () ----------------------- AGAINST THE ORDER/JUDGMENT IN ITA 602/COCH/2013 of I.T.A.TRIBUNAL,COCHIN BENCH DATED 07-05-2015 - ASSESSMENT YEAR 2006-07 APPELLANT(S):/APPELLANT/REVENUE ------------ THE COMMISSIONER OF INCOME TAX (CENTRAL), KOCHI - 692 011

BY ADVS.SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES) SRI.JOSE JOSEPH, SC, FOR INCOME TAX RESPONDENT(S):/RESPONDENT/ASSESSEE -------------- M/S.HOTEL ROYALE PARK 34/1860C, KALPAKA APARTMENTS, PALARIVATTOM, KOCHI 682 025.

R1 BY ADV. SRI.ANIL D. NAIR R1 BY ADV. SRI.R.SREEJITH R1 BY ADV. SMT.NIVEDITA A.KAMATH R1 BY ADV. KUM.SOUMYA PRAKASH R1 BY ADV. KUM.MEKHALA M.BENNY THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 22-11-2016, ALONG WITH ITA. 272/2015, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

ITA260/15 APPENDIX APPELLANT'S ANNEXURES ANNEXURE-A : COPY OF STATEMENT RECORDED FROM SHRI.K.P.ANANDARAJ, GENERAL MANAGER. ANNEXURE-B : COPY OF ASSESSMENT ORDER FOR THE ASST. YEAR 2006-07 UNDER SECTION 153C R.W.S.143(3), OF THE ASSESSING OFFICER DATED 31.12.2008. ANNEXURE-C : COPY OF ASSESSMENT ORDER FOR THE ASST. YEAR 2005-06 U/S. 153C R.W.S. 143(3), OF THE ASSESSING OFFICER DATED 31.12.2008. ANNEXURE-D : COPY OF ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) DATED 24.06.2012. ANNEXURE-E : COPY OF ORDER OF THE JUDICIAL MEMBER OF THE TRIBUNAL DATED SEPTEMBER, 2014. ANNEXURE-F : COPY OF ORDER OF THIRD MEMBER (JUDICIAL MEMBER) OF THE TRIBUNAL DATED NIL. ANNEXURE-G : COPY OF ORDER OF THE JUDICIAL MEMBER OF THE TRIBUNAL DATED OCTOBER, 2014. ANNEXURE-H : COPY OF ORDER OF THE ACCOUNTANT MEMBER OF THE TRIBUNAL DATED 29.10.2014. ANNEXURE-I : COPY OF ORDER OF THE ACCOUNTANT MEMBER OF THE TRIBUNAL DATED NIL. ANNEXURE-J : COPY OF ORDER OF THE TRIBUNAL IN ITA 601 TO 603/COCH/2014 DATED 07.05.2015. //TRUE COPY// PA TO JUDGE. jg-20/12

THOTTATHIL B.RADHAKRISHNAN & DEVAN RAMACHANDRAN, JJ. .................................................................... ITA Nos.260 and 272 of 2015 .................................................................... Dated this the 22nd day of November, 2016. J U D G M E N T Thottathil B.Radhakrishnan, J. 1.These appeals by the Revenue are against the decision of the Income Tax Appellate Tribunal. 2.It is submitted by both sides that in the light of the judgment rendered by a Division Bench of this Court on 03.10.2016 in ITA No.31 of 2016 and connections, a copy of which is annexed herewith, these appeals deserve to be ordered, setting aside the decision of the Tribunal and remitting the matter for reconsideration of the Tribunal, in accordance with law. 3.In view of the fact that the Tribunal's jurisdiction was invoked by the respondent-assessee, we clarify that if the assessee or the Revenue seeks leave of the Tribunal to raise additional grounds in the appeals or in opposition thereto, such request will be

ITA260&272/15 -2- considered by the Tribunal, in accordance with law. With the aforesaid directions, the orders of the Tribunal impugned in these appeals are set aside and the matters are remitted to the Tribunal in the light of what is stated above. These appeals are ordered accordingly. (THOTTATHIL B.RADHAKRISHNAN, JUDGE) (DEVAN RAMACHANDRAN, JUDGE) jg-22/11

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