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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI SANJAY ARORA & SHRI G. PAVAN KUMAR
आदेश /O R D E R
Per Sanjay Arora, AM:
This is an Appeal by the Revenue agitating the Order by the Commissioner of Income Tax (Appeals)-I, Chennai (‘CIT(A)’ for short) dated 09.10.2015, partly allowing the assessee’s appeal contesting it’s assessment u/s. 143(3) of the Income Tax Act, 1961 (‘the Act’ hereinafter) for the assessment year (AY) 2010-11 vide order dated 29.03.2013.
2 I.T.A. No. 830/Mds./2016 Dy. CIT v. Consolidated Construction Consortium Ltd. 2. The appeal raises two issues projected per several grounds of appeal
, which we shall take up in seriatim.
3. At the very outset, it was submitted by the ld. A.R, the assessee’s counsel, that both the issues arising in the instant appeal are covered by the decision by the coordinate bench of this Tribunal in the assessee’s own case. The first issue, he would continue, is in respect of trade license fee of Rs.200 lacs, allowed by the assessee to it’s directors for the use of brand name/logo obtained from a partnership firm, M/s. Samriddhi Holdings, a closely held related firm. The same stands disallowed section 37(1) r/w s. 40A(2)(a) of the Act. He would then take us to the relevant part (para 18) of the tribunal’s cited order(s) (in and 701, 702 & 875/2014 for assessment years 2006-07 to 2009-10 dated 06.01.2016/copy on record), of which the letter is reproduced as under:
“18. We have heard both the parties and perused the material available on record. This issue came up for consideration before the Tribunal in assessee’s own case for assessment year 2006-07 in and the Tribunal vide order dated 24.5.2011 decided the issue in favour of the assessee by observing that the payment made to M/s. Samruddhi Holdings is an allowable expenditure u/s. 37 of the Act and thereby annulled the revisional order of the CIT dated 27.10.2010 passed u/s 263 of the Act. Being so, in our opinion, the expenditure incurred by the assessee is a revenue expenditure and to be allowed accordingly. This ground is dismissed”.
It is apparent therefore that the tribunal had allowed the impugned claim (qua the trade licence fee) in the assessee’s own case following it’s earlier order (in dated 24.05.2011) for (AY) 2006-2007 in s. 263 proceedings. The ld. D.R, on being queried in the matter, admitted to the same being squarely covered by the said decision and, further, that an appeal had been preferred by the Revenue to keep the issue alive; having already filed an appeal before the Hon’ble jurisdictional High Court in the assessee’s case for AY 2009-10, as clarified per its Ground 2.5. Even as the Revenue has raised several grounds, we find the issue arising, in its several aspects, has been considered by the tribunal per its cited decision supra, so that the same must be considered as finalized at the end of the ./2016 Dy. CIT v. Consolidated Construction Consortium Ltd. tribunal. We, therefore, respectively following the same, decline interference and, accordingly, uphold the impugned order.
The second issue (raised per Grounds 3.1 to 3.5), again, as was the common contention of the parties before us, stands decided in the assessee’s favour by the tribunal in the assessee’s own case for earlier years following the decision by the Hon’ble High Court in CIT v. VTM Ltd. [2009] 319 ITR 336 (Mad); the ld. AR alluding to para 21 of the tribunal’s order supra for AY 2009-10 (in which reads as under; the tribunal upholding the assessee’s claim for additional depreciation in respect of its’ separate unit for manufacture of concrete mix: “21. We have heard both the parties and perused the material on record. The assessee is engaged in the business of ready-mix concrete and shown the income from ready-mix concrete sales separately and claimed that the assessee is engaged in the business of manufacture and production of new article and for that purpose it has acquired new machinery and plant. Accordingly, additional depreciation u/s 32(1)(ii) of the Act was claimed. The Assessing Officer was of the opinion that the assessee was in the activity of civil construction and it is not in the field of manufacturing. However, the CIT(A) considering the ready-mix concrete plant as a separate undertaking which is engaged in the manufacture of article or thing, granted additional depreciation u/s 32(1)(ii) of the Act. In our opinion, the findings of the CIT(A) is justified and the contention of the Revenue is not sustainable in view of the judgment of the jurisdictional High Court in the case of CIT vs VTM Ltd., 319 ITR 336, wherein held that the assessee which was a manufacturer of textile goods when set up a windmill was entitled to additional depreciation. Same view was taken by the co-ordinate Bench in the case of Sheela Clinic in I.T.A. No.481/Mds/2011 dated 30.05.2011, by observing that generation of electricity is an independent activity though originally the assessee is engaged in the business of running a hospital. Considering the facts and circumstances of the present case, we are of the opinion that the CIT(A) has rightly allowed the claim of the assessee. This ground of the Revenue is dismissed.’ 6. No distinguishing feature stands brought to our notice, with the Revenue in fact admitting to have filed the appeal to keep the issue alive. We, therefore, respectfully following the said order by the tribunal in the assessee’s own case, confirm the impugned order. We decide accordingly.