M/S NEW PUNJAB MOTOR TRANSPORT,JAMSHEDPUR vs. ITO WARD-1(2), JAMSHEDPUR

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ITA 315/RAN/2017Status: DisposedITAT Ranchi16 November 20186 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal allowed depreciation at 30% on excavators by following its previous order. For the interest disallowance, a portion was remanded to the Assessing Officer for verification, while the remaining amount was confirmed.

What were the facts?

The assessee claimed depreciation at a higher rate of 30% on excavators, which was disallowed by the Assessing Officer and confirmed by the CIT(A). The assessee also faced disallowance of interest paid on vehicle finance due to non-deduction of TDS.

What were the issues?

Whether excavators are eligible for higher depreciation and whether interest paid on vehicle finance is disallowable for non-deduction of TDS.

Which sections of the Income-tax Act were involved?

Section 40(a)(ia),Section 194C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RANCHI ‘ SMC’ BENCH, RANCHI

Before: SHRI N.S SAINI

For Appellant: Shri Devesh Poddar, Adv
For Respondent: Shri A.K.Mohanty, JCIT
Hearing: 22/11

This is an appeal filed by the assessee against the order of

the CIT(A), Jamshedpur dated 12.9.2017 for the assessment year

2012-13.

2.

In Ground No.1 of appeal, the grievance of the assesse is that

the CIT(A) erred in not allowing depreciation at higher rate of 30%

to the assesse on Excavators.

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ITA No. 315/R an/ 2017 Asse ssment Year : 20 12- 13 :

3.

The brief facts of the case are that the Assessing Officer

disallowed depreciation claimed by the assesse on higher rate of

30% on Excavator and, thereby, made an addition of

Rs.10,69,441/-.

4.

On appeal, the CIT(A) confirmed the same.

5.

Before us, ld A.R. of the assesse has filed copy of order of this

Bench of the Tribunal in the case of the assesse itself for the

assessment year 2010-11 and submitted that the Tribunal vide its

order dated 11.3.2016 passed in ITA No.309/Ran/2014 has

confirmed the order of the CIT(A) in allowing depreciation on

excavator at higher rate of 30% and, therefore, following the same,

the disallowance made should be deleted.

6.

Ld D.R. agreed with the above submission of ld A.R. of the

assesse.

7.

After hearing the rival submissions and perusing the materials

on record, I find that the Tribunal for the assessment year 2010-11

vide its order dated 11.3.2016 in the appeal filed by the revenue

has held as under:

‘ 18. In the assessment order, the AO did not allow higher rate of depreciation as claimed by the assesse. However, the ld CIT(A) directed the AO to allow higher rate of depreciation @ 30% in respect of trucks, trailers and excavators. Hence, the revenue has filed appeal on this ground.

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19.

We have heard both the sides and perused the record of the case. The question before us whether trucks, trailers and excavators as claimed by the assesse would fetch higher rate of depreciation or not? We find that the ITAT Kolkata in the case of M/s. Bothra Shipping Services vs ACIT in ITA Nos.58 -61/Kol/2013 for assessment years 2004-05 to 2007-08 order dated 19.12.2014 considered the issue and after discussing various case laws in the said order, held that pay loaders, JCBs and 400V loaders can be classified as plant and machinery for the purpose of depreciation and not as motor bus, motor lorry or any transport/goods vehicles JCB is entitled to higher rate of depreciation claimed by the assesse. Hence, respectfully following the said decision (supra), we uphold the findings of the CIT(A) in allowing higher rate of depreciation. This ground is rejected.’

8.

Respectfully following the decision of the Tribunal, I set aside

the orders of lower authorities and allow depreciation at the rate of

30% claimed by the assesse.

9.

In Ground No.2 of appeal, the grievance of the assesse is that

the CIT(A) erred in confirming the disallowance of interest of

Rs.4,36,006/- paid to M/s. SREI Equipment Finance Pvt Ltd., and

M/s. Tata Capital Ltd.,towards payment of instalment of vehicle

finance for non-deduction of tax u/s.194C of the Act by applying the

provisions of section 40(a)(ia) of the Act.

10.

The brief facts of the case are that the Assessing Officer

disallowed interest payment of Rs.4,36,006/- to M/s. SREI

Equipments Finance Pvt Ltd., and M/s. Tata Capital Ltd., on the

ground that the assesse failed to deduct TDS u/s.194C of the Act.

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11.

On appeal, the CIT(A) confirmed the action of the Assessing

Officer.

12.

Before me, ld A.R. of the assesse has filed Annexure-A to

Form No.26A issued by the Chartered Accountant to contend that

the interest paid by the assesse was shown by M/s. SREI

Equipments Finance Pvt Ltd., in the return of income filed and

contended that no disallowance was warranted under section

40(a)(ia) of the Act.

13.

Ld D.R. supported the orders of lower authorities.

14.

I have heard the rival submissions, perused the orders of

lower authorities and materials available on record. In the instant

case, the Assessing Officer disallowed interest payment of

Rs.4,36,006/- paid to M/s. SREI Equipments Finance Pvt Ltd., and

M/s. Tata Capital Ltd., for non-deduction of TDS u/s.194C of the Act

by invoking the provisions of section 40(a)(ia) of the Act, which was

confirmed in appeal by the CIT(A).

15.

Before me, ld A.R. has filed Annexure-A to Form No.26A

issued by the Chartered Accountant to contend that interest income

paid by the assesse has been shown as income by M/s. SREI

Equipments Finance Pvt Ltd., and, therefore, no disallowance of

interest income was warranted. I find that total disallowance of

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interest made by the Assessing Officer was Rs.4,36,006/-. The

assesse has filed Form 26A of Rs.3,99,765/- contending that

interest paid by the assesse was shown as income by M/s. SREI

Equipments Finance Pvt Ltd. This document was not filed before

the CIT(A). Therefore, I set aside orders of lower authorities on

this part of the issue back to the file of the Assessing Officer for

verification and thereafter to readjudicate the same as per law.

16.

With regard to the balance amount of Rs.36,241/-, the

assesse has not filed any evidence nor made any arguments as to

why the disallowance should be deleted. Hence, I confirm the

disallowance of Rs.36,241/-

17.

In the result, appeal of the assesse is partly allowed for

statistical purposes…

Order pronounced on 22 /11/2018.

Sd/- (N.S Saini) ACCOUNTANT MEMBER Ranchi; Dated 22/11/2018 B.K.Parida, SPS

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Copy of the Order forwarded to : 1. The Appellant : New Punjab Motor Transport, Room No.28, Dimna Road, Mango, Jamshedpur

2.

The Respondent. ITO, Ward-1(2), Jamshedpur 3. The CIT(A)- Jamshedpur 4. Pr.CIT- Jamshedpur 5. DR, ITAT, Ranchi 6. Guard file. //True Copy// By order Sr. Pvt.secretary, ITAT, Ranchi on tour

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