COMMISSIONER OF INCOME TAX, SEC-14, HISAR vs. MARKET COMMITTEE RATIA

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ITA/182/2011HC Punjab & HaryanaPHHC01095501201111 July 2011Bench: MR. JUSTICE AJAY KUMAR MITTAL,MR. JUSTICE ADARSH KUMAR GOEL2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal filed by the Revenue. The Court noted that the learned counsel for the Revenue fairly conceded that similar questions of law had been adjudicated upon by the High Court against the Revenue in a previous case, Income Tax Appeal No. 535 of 2009 (The Commissioner of Income Tax, Karnal vs. Market Committee, Pipli), decided on July 5, 2010. Therefore, the present appeal was disposed of in view of the said decision. The specific reasoning of the ITAT allowing depreciation is not detailed in this High Court judgment, nor is the ratio decidendi of the cited precedent explicitly stated. However, the dismissal implies that the High Court found no substantial question of law to interfere with the ITAT's order, likely following its own prior ruling that depreciation on such assets is permissible.

What were the facts?

The Revenue, Commissioner of Income Tax, Hisar, filed an appeal under Section 260A of the Income-Tax Act, 1961, against an order dated August 13, 2010, passed by the Income Tax Appellate Tribunal, New Delhi Bench 'E'. The appeal pertains to the assessment year 2007-08 and challenges the Tribunal's decision to allow depreciation on capital assets. The assessee is Market Committee, Ratia. The core of the dispute revolves around whether depreciation can be claimed on assets for which capital expenditure was already claimed, potentially leading to a double deduction. The amount in dispute is not explicitly stated.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the Hon'ble ITAT is justified in allowing depreciation on capital assets when capital expenditure on the acquisition of the corresponding assets had already been claimed for the purpose of allowing exemption under Section 11 of the Income Tax Act, thereby amounting to a double deduction for the same expenditure? 2. Whether allowing depreciation on capital assets by the Hon'ble ITAT is justified in light of the Hon'ble Apex Court decision in Escorts India Ltd. (199 ITR 43), which held that in the absence of clear statutory indication to the contrary, the statute should not be read as to permit an assessee two deductions on the same expenditure? Revenue's Contention: The Revenue argued that allowing depreciation on capital assets, where capital expenditure has already been claimed for exemption under Section 11, constitutes a double deduction. They relied on the principle laid down in Escorts India Ltd. (199 ITR 43) regarding avoiding double deductions without clear statutory backing. Assessee's Contention: The judgment does not record any specific contentions made by the assessee.

Which sections of the Income-tax Act were involved?

Section 260A,Section 11

AI-generated summary — verify with the full judgment below

.. I-":::>. 0 (,) J: (!)-:I:«z~ a:::«J: 0 Z« ca« Jz~ a.. Income Tax Appeal No. 182 of 2011 1 . ' .11 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. '",--- Income Tax Appeal No. 182 of 2011 Date of decision: 11.7.2011 Commissioner of Income Tax Hisar --- Appellant Versus Market Committee, Ratia --- Respondent CORAM: HON'BLE MR. JUSTICE ADARSH KUMAR GOE~ . ACTING CHIEF JUSTICE . HON'BLE MR. JUSTICE AJAY KUMAR MITTAL Present: Mr. Yogesh Putney, Senior Standing Counsel for the appellant-revenue. AJAY KUMAR MITTAL J. This appeal under Section 260A of the Income-Tax Act, 1961 (for short "the Act") has been filed by the revenue against the order dated 13.8.2010, passed by the Income Tax Appellate Tribunal New Delhi, Bench 'E' (in short "the Tribunal") in ITA No. 1401/0e1/2010, relating to the assessment year 2007-08. The following substantial questions of law have been claimed for determination of this Court: "1- Whether on the facts and in the circumstances of the case, the Hon'ble ITAT is justified in allowing depreciation on capital assets even when capital expeQditure on acquisition of the corresponding assets had already been

" r--- ~>~ ~m""';"'~~~'---- / , ~"0;;""""'- ;.,'t"~"'''::i'''~j!r~'' '.'k~-- /"" - : . ,.", '.'. . ..." ,,'" ,I" .' // Income Tax Appeal No. 182 of 2011 ,"; 2 purpos€ of allowing exemption under Section 11 of the Income Tax Act and as such further allowing of depreciation on these capital assets will amount to double deduction for the same expenditure? 2- Whether allowing of depreciation on the capital assets by Hon'ble ITAT is justified in the light of the Hon'ble f\pex Court decision in-the case of Escorts India Ltd. (199 ITR L:J ,:):J 43), wherein it has been held that in the absence of clear statutory indication to the contrary, the statute should not be read as to permit an assessee two deductions on the - ... .~ same expenditure?" ,-- .~ ...... Learned counsel for the revenue fairly conceded that ,~ Z <~ ~~ ,,",,,., tL~ similar questions, as noticed-above, have been adjudicated upon by this Court against the Revenue in Income Tax Appeal No. '535 of 2009 (The Commissioner. of Income Tax, Karnal vs. rJlarket Committee, Pipli), decided on 5.7.2010 and the instant appeal also .-.J... Q Z ~ JJ ~-:( J Z '""",, ",,J :J.. deserves to be disposed of in view of the said decision. In view of the above, the appeal is dismissed. July 11, 2011 *rkmalik*

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