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Income Tax Appellate Tribunal, AHMEDABAD “SMC” BENCH
Before: SHRI N.K. BILLAIYA & SHRI S.S. GODARA
PER N.K. BILLAIYA, ACCOUNTANT MEMBER:
ITA Nos. 811/Ahd/2017 & 376/Ahd/2017 are two separate appeals by the Assessee preferred against two separate orders of the Ld. CIT(A)-3, Vadodara
ITA Nos. 811 & 376/Ahd/2017 2 . A.Ys. 2012-13 & 2013-14 dated 30.11.2016 & 02.02.2017 pertaining to A.Ys. 2012-13 & 2013-14 respectively.
The underlying facts in issues are identical in both the years, therefore both these appeals are taken together and disposed of by this common order for the sake of convenience and brevity. Representatives of both sides agreed that facts of A.Y. 2012-13 in ITA No. 376/Ahd/2017 may be considered.
The dispute relates to the denial of higher depreciation on computer peripherals.
The assessee is in the business of Xerox, scanning & binding services. The return for the year under consideration was selected for scrutiny assessment and accordingly statutory notices were issued and served upon the assessee.
On verification of the block of assets and depreciation claimed, the A.O. noticed that the assessee has claimed depreciation @ 60% in respect of following items:-
Sr, No, Name Opening Depreciation Depreciation WPV/addition claimed @60% allowable @15%
1 Digital Multi function 73601 44161 11040
2 Digital Multi function 73601 44161 11040
3 Digital Multi function 19162 11497 2874
4 Digital Multi function 34912 20947 5237
S Digital Multi function 27562 16537 4134
6 Digital Multi function 47775 28665 7166
ITA Nos. 811 & 376/Ahd/2017 3 . A.Ys. 2012-13 & 2013-14
7 Digital Multi function [JI1262 12757 3189
8 Digital paper copier 68250 40950 10237
9 Digital paper copier 68250 40950 10237
10 DVRCard 8339 5003 1251
11 HP T-770 plotter 84000 50400 12600
12 OCE-Plotwave 787500 472500 118125
13 OCE TDS 320 247520 148512 37128
14 Old used copier 1 78120 19530
15 Old used digital copier 65100 39060 9765
16 Old used digital copier 67200 40320 10080
17 OW used photo copier 65100 39060 9765
18 Paper copier 9744 5846 1462
19 Photo copier Machine 141750 85050 21262
20 Plain paper copier 168000 -50% 50400 12600
21 X-1000 Press 8795460-50% 2638638 659659 Excess depreciation claimed Rs. 29,35,153/-
The A.O. was of the opinion that the applicable rate of depreciation is 15% and accordingly computed the excess depreciation at Rs. 29,35,153/-.
Assessee carried the matter before the ld. CIT(A) and vehemently submitted that the impugned assets are computer peripherals and therefore the applicable rate of depreciation is 60%.
After considering the facts and the submissions, the ld. CIT(A) was convinced with the claim of depreciation on Items No. 1 to 13 of the depreciation chart
ITA Nos. 811 & 376/Ahd/2017 4 . A.Ys. 2012-13 & 2013-14 mentioned elsewhere. However, in respect of Items No. 14 to 21, the ld. CIT(A) confirmed the findings of the A.O.
Before us, the ld. counsel for the assessee reiterated what has been stated before the lower authorities. Per contra, the ld. D.R. strongly supported the findings of the A.O.
We have given a thoughtful consideration to the orders of the authorities below. We find that the dispute arose because of the nomenclature given in the books of the accounts of the assessee. Since the assessee has used the word “copier”, the A.O. was of the opinion that on photo-copy machines, the eligible rate of depreciation is 15% and not 60% as the photo-copiers are not computer peripherals.
We find that the assessee has separately shown photo-copiers and has claimed depreciation @ 15% only. This can be seen from the schedule of fixed assets and depreciation exhibited at page 23 of the paper book.
The impugned assets on which the dispute arose are multifaceted printers having dimensional functions but at the same time, the impugned assets are printers and are part and parcel of the computer system.
The Hon’ble High Court of Delhi in the case of BSES Yamuna Powers Ltd. 358 ITR 47 has held that computer accessories and peripherals such as printers, scanners and server, etc., form an integral part of computer system and, hence, they are entitled to depreciation at higher rate of 60%.
ITA Nos. 811 & 376/Ahd/2017 5 . A.Ys. 2012-13 & 2013-14 14. Respectfully following the judgment of the Hon’ble High Court of Delhi (supra), we direct the A.O. to allow depreciation @ 60%. Both the appeals by the Assessee are accordingly allowed.
Order pronounced in Open Court on 05- 04- 2018
Sd/- Sd/- (S. S. GODARA) (N. K. BILLAIYA) JUDICIAL MEMBER True Copy ACCOUNTANT MEMBER Ahmedabad: Dated 05/04/2018 Rajesh Copy of the Order forwarded to:- 1. The Appellant. 2. The Respondent. 3. The CIT (Appeals) – 4. The CIT concerned. 5. The DR., ITAT, Ahmedabad. 6. Guard File. By ORDER
Deputy/Asstt.Registrar ITAT,Ahmedabad