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Income Tax Appellate Tribunal, “A” BENCH, KOLKATA
Before: Shri M. Balaganesh
These appeals of the revenue and cross objection of the assessee arise out of the order of the Learned CITA in Appeal No. 156/CIT(A)C-I/CC-XXVIII/11-12 dated 23.11.2012 for Asst Year 2006-07 and Appeal No. 157/CIT(A)C-I/CC-XXVIII/11-12 dated 23.11.2012 for Asst Year 2009-10 against the orders of assessment framed u/s 143(3) / 147 / 263 of the Income Tax Act, 1961 (hereinafter referred to as the ‘Act’).
Shri. Rajat Subhra Biswas, the Learned CIT DR argued on behalf of the revenue and none appeared on behalf of the assessee. , 142,143 & CO No.33/Kol/13-AM 1 M/s. Binani Cement Ltd
The revenue had raised the following grounds for both the years under appeal :- Grounds of Appeal for A.Y 2006-07
(i) That the Ld.CIT(A) has erred in Law as well as in facts and circumstances of the case in deleting the disallowance of depreciation amounting to Rs.2,06,64,525/- on capital equipment purchased from M/s. Shrimal Construction (P) Ltd. (ii) That the Ld.CIT(A) has erred in Law as well as in facts and circumstances of the case in deleting the addition of Rs.9,19,52,000/- made to book profit u/s.115JB on the ground that the order u/s. 263 dated 20.01.2011 of the Ld. CIT(Central)-I, Kolkata has been quashed by the Hon’ble ITAT, while an appeal u/s. 260A is pending before the Hon’ble High Court at Calcutta, against the order of the Hon’ble ITAT. (iii)That the Department craves to add, modify or alter the grounds of appeal during the course of hearing of the case.
Grounds of Appeal for A.Y 2009
10. (i) That the Ld.CIT(A) has erred in Law as well as in facts and circumstances of the case in deleting the disallowance of depreciation amounting to Rs.1,14,42,291/- on capital equipment purchased from M/s. Shrimal Construction (P) Ltd. (ii) That the Ld.CIT(A) has erred in Law as well as in facts and circumstances of the case in deleting the addition amounting to Rs.3,53,74,000/- on account of payments made to M/s. Shrimal Construction (P) Ltd. (iii)That the Department craves to add, modify or alter the grounds of appeal during the course of hearing of the case.
As the issues involved in both the years are identical in nature, they are taken up together and disposed off by this common order for the sake of convenience and brevity.
The Learned DR vehemently supported the orders of the Learned AO. , 142,143 & CO No.33/Kol/13-AM 2 M/s. Binani Cement Ltd
We have heard the Learned DR and perused the materials available on record. The Learned CITA had deleted the additions by making the following observations :-
Para 4 to 6 of the ld.CIT(A)’s order: “4. Ground no.2 relates to disallowance of depreciation of Rs.2,06,64,525/- on capital equipment purchased from M/s. Shrimal Construction (P) Ltd (SCPL) in the preceding year as well as in the relevant year. In course of the appellate proceedings, the Ld ARs made the following submissions: “In the assessment order, the depreciation has been allowed at Rs.2,06,64,525/- vide para 9 of the assessment order. The findings are in para-9. However, at the outset, it is submitted that the appellant had filed the complete information about the payment made to SCPL for the purchase of plant and machinery which are placed on the record before your Honour. However, the issue of bogus capital purchase was before the ITAT Kolkata in appellant’s own case and on an identical fact the Tribunal confirmed the order of CIT(A) for AY 05-06, AY 07-08 and AY 08-09”. It may be worthwhile to note that the AO has disallowed the depreciation for AY 07-08 at Rs.81,93,596 which were deleted by the CIT(A) and the ITAT Kolkata. Therefore, respectfully following the order of the CIT(A) for AY 05-06, 06-07 and 08-09 and the Tribunal orders for identical issue the impugned disallowance in respect of depreciation cannot be sustained, more so when the disallowance consist of the WDV of the earlier asset including purchase of asset which the AO has not disputed and the facts are identical. The ground may be allowed accordingly.
5. The Ld ARs have submitted that the issue is directly covered by the orders of the CIT(A) as well as those of the Hon’ble ITAT in appellant’s own case for the assessment years 2005-06, 2007-08 and 2008-09. Copy of the appellate orders was filed in course of the appellate proceedings. I have perused the relevant orders and considered the submissions made on behalf of the appellant. I find that similar disallowances on account of depreciation was made by the AO in the case of the appellant for the assessment years 2005-06, 2007-08 and 2008-09 which has been subject matter of appeal before the Ld CIT(A) as well as before the Hon’ble ITAT. These disallowances made for the assessment years 2005-06, 2007-08 and 2008-09 were deleted by the Ld CIT(A) C-I, Kolkata in Appeal No.100/CC-XXVIII/CIT(A) C-I/09-10; Appeal No.96/CC-XXVIII/CIT(A) C-I/09-10 and Appeal No.137/CC-XXVIII/CIT(A) C-I/10-11. The orders of the CIT(A) for the assessment years 2005-06 and 2007-08 was upheld by , 142,143 & CO No.33/Kol/13-AM 3 M/s. Binani Cement Ltd the Hon’ble ITAT ‘A’ Bench, Kolkata vide its order dated 27-01-2012 in & 7502/Kol/2011. Also, the order of the CIT(A) for the assessment years 2008-09 was upheld by the Hon’ble ITAT ‘B’ Bench, Kolkata vide its order dated 20-04-2012 in ITA No.1716/Kol/2011. Thus, the Hon’ble jurisdictional ITAT has also concurred with the orders of my learned predecessor in allowing the claim of the appellant by dismissing the appeal of the Revenue. Respectfully following the above decisions of my learned predecessor and the jurisdictional ITAT, the disallowance of Rs.2,06,64,525/- on account of depreciation is directed to be deleted. Ground no.2 is allowed.
6. Ground no.3 is related to the addition of Rs.919.52 lakhs as made to the book profit u/s. 115JB being the loss incurred by the appellant on account of transfer of investment division as per scheme of arrangement, as directed by the CIT, Central-1, Kolkata vide his order dated 20-01- 2011 passed u/s.
The Ld ARs have submitted that the said order passed by the CIT u/s. 263 has already been quashed by the Hon’ble ITAT ‘B’ Bench, Kolkata vide its order dated 30-03-2012 in ITA No.239/Kol/2011; and consequently, the addition made by the AO in pursuant to the directions contained in the order u/s. 263 cannot survive. Copy of the ITAT order was filed in course of the appellate proceedings. I agree with the Ld ARs that since the order u/s. 263 has been quashed by the Hon’ble ITAT, the consequential addition as made by the AO cannot survive. Ground no.3 is allowed.”
Similarly for Asst Year 2009-10 , the Learned CITA had reproduced the same findings given by him for Asst Year 2006-07 except the following difference in figures :-
“Respectfully following the above decisions of my learned predecessor and the jurisdictional ITAT, the disallowance of Rs. 1,14,42,291/- on account of depreciation and that of Rs. 3,53,74,000/- being payment made to SCPL is directed to be deleted. Ground no. 1.1,2 and 2.1 is allowed”.
In view of the aforesaid clear findings of the Learned CITA and respectfully following the co-ordinate bench decision of this tribunal in assessee’s own case for the Asst Years 2005-06 ; 2007-08 & 2008-09 on the similar issues, we are not inclined to interfere with the order of the Learned CITA and accordingly, the grounds raised
by the revenue are dismissed. Since the issues are adjudicated on merits in favour of the , 142,143 & CO No.33/Kol/13-AM
4. M/s. Binani Cement Ltd assessee, the cross objections filed by the assessee becomes infructuous and accordingly the same is dismissed as infructuous.
In the result, the appeals of the revenue in 143 / Kol /2013 for Asst Years 2006-07 & 2009-10 respectively are dismissed and cross objection of the assessee in CO No. 33 / Kol / 2013 is dismissed.
THIS ORDER IS PRONOUNCED IN OPEN COURT ON 28 / 10/2015