ITO, Pune v. Ashoka Infrastructure Ltd., Pune

ITA 1105/PUN/2010 | 2007-2008
Pronouncement Date: 18-07-2013 | Result: Dismissed

Appeal Details

RSA Number 110524514 RSA 2010
Assessee PAN AAECA5421G
Bench Pune
Appeal Number ITA 1105/PUN/2010
Duration Of Justice 2 year(s) 11 month(s) 14 day(s)
Appellant ITO, Pune
Respondent Ashoka Infrastructure Ltd., Pune
Appeal Type Income Tax Appeal
Pronouncement Date 18-07-2013
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 18-07-2013
Date Of Final Hearing 16-07-2013
Next Hearing Date 16-07-2013
Assessment Year 2007-2008
Appeal Filed On 04-08-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES B PUNE BEFORE SHRI G.S. PANNU ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR JUDICIAL MEMBER ITA NO. 989/PN/2010 (ASSESSMENT YEAR : 2007-08) M/S ASHOKA INFRASTRUCTURE LTD. ASHOKA ARC PLOT NO. E 28/29 GROUND FLOOR OPP. DARPAN HOTEL MARKET YARD GUL TEKADI PUNE 411 037 PAN : AAECA5421G . APPELLANT VS. INCOME TAX OFFICER WARD 8 (1) AKURDI PUNE . RESPONDENT ITA NO. 1105/PN/2010 (ASSESSMENT YEAR: 2007-08) INCOME TAX OFFICER WARD 8 (1) AKURDI PUNE . APPELLANT VS. ASHOKA INFRASTRUCTURE LTD. ASHOKA ARCH PLOT NO. E 28/29 GROUND FLOOR OPP. DARPAN HOTEL MARKET YARD GUL TEKADI PUNE 411 037 PAN : AAECA5421G . RESPONDENT ASSESSEE BY : MR. SUNIL PATHAK DEPARTMENT BY : MR. ADARSH KUMAR MODI DATE OF HEARING : 16-07-2013 DATE OF PRONOUNCEMENT : 18-07-2013 ORDER PER G. S. PANNU AM THE CAPTIONED CROSS-APPEALS EACH BY THE ASSESSEE AND THE REVENUE PERTAINING TO THE ASSESSMENT YEAR 2007-08 WERE HEA RD TOGETHER AND ARE BEING DISPOSED-OFF BY WAY OF A CONSOLIDATED ORDER F OR THE SAKE OF CONVENIENCE AND BREVITY. THE CAPTIONED APPEALS ARE DIRECTED AGA INST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - V PUNE DATE D 21.05.2010 WHICH IN ITA NO. 989/PN/2010 ITA NO. 1105/PN/2010 A.Y. 2007-08 TURN HAS ARISEN FROM AN ASSESSMENT ORDER DATED 29. 12.2009 PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE INCO ME TAX ACT 1961 (IN SHORT THE ACT) FOR THE ASSESSMENT YEAR 2007- 08. 2. WE SHALL TAKE-UP THE APPEAL OF THE ASSESSEE IN I TA NO.989/PN/2010 WHEREIN THE SUBSTANTIVE DISPUTE RAISED IS BY WAY OF GROUND OF APPEAL NO.1.1 WHICH READS AS UNDER :- 1.1 THE LEARNED CIT(A) ERRED IN HOLDING THAT THE I NTANGIBLE ASSET IN THE FORM OF LICENSE/RIGHT TO COLLECT TOLL IS NOT ELIGIBLE TO DEPRECIATION UNDER THE INCOME TAX ACT AS AN INTANGIBLE ASSET @ 25%. HE ERR ED IN NOT CONSIDERING THE SUBMISSIONS MADE BEFORE HIM IN THEIR PROPER PER SPECTIVE. THEREFORE IT IS PRAYED TO HOLD THAT THE LICENSE/RIGHT TO COLLECT T OLL IS AN INTANGIBLE ASSET UNDER INCOME TAX ELIGIBLE FOR DEPRECIATION AT 25%. 3. IN BRIEF THE FACTS RELEVANT TO THE AFORESAID GR OUND AS FOLLOWS. THE ASSESSEE IS A COMPANY INCORPORATED UNDER THE PROVIS IONS OF THE COMPANIES ACT 1956 AND IS ENGAGED IN THE BUSINESS OF CONSTRU CTION OPERATION AND MAINTENANCE OF INFRASTRUCTURE FACILITY ON BOT (BUIL D OPERATE AND TRANSFER) BASIS. IN TERMS OF THE SAME ASSESSEE WAS ENGAGED I N DEVELOPMENT OPERATION AND MAINTENANCE OF INFRASTRUCTURE PROJECT ENTITLED FOUR-LANING AND STRENGTHENING OF PUNE-AHMEDNAGAR ROAD ON BOT BASIS . FOR THE ASSESSMENT YEAR UNDER CONSIDERATION ASSESSEE FILED A RETURN O F INCOME DECLARING A LOSS OF RS.5 49 45 686/- WHICH INTER-ALIA INCLUDED A CLAIM OF DEPRECIATION OF RS.30 04 85 739/- ON LICENSE TO COLLECT TOLL @ 25 %. THE SAID CLAIM OF THE ASSESSEE IS THE SUBJECT MATTER OF DISPUTE BEFORE US . 4. THE ASSESSEE WAS AWARDED THE INFRASTRUCTURE PROJ ECT OF DEVELOPMENT OPERATION AND MAINTENANCE OF THE PUNE-AHMEDNAGAR RO AD BY THE GOVERNMENT OF MAHARASHTRA THROUGH ITS PUBLIC WORKS DEPARTMENT (PWD) ON BOT BASIS. IN TERMS OF THE TENDER CONDITIONS AGREEM ENT ENTERED INTO WITH THE PWD ASSESSEE WAS REQUIRED TO DEVELOP THE SAID INFR ASTRUCTURE FACILITY BY ARRANGING FUNDS ON ITS OWN. THE ASSESSEE WAS ALSO U NDER AN OBLIGATION TO MAINTAIN THE SAID INFRASTRUCTURE FACILITY (I.E. ROA D) AT ITS OWN COST FOR A SPECIFIED ITA NO. 989/PN/2010 ITA NO. 1105/PN/2010 A.Y. 2007-08 PERIOD. AT THE END OF THE SPECIFIED PERIOD ASSESSE E WAS UNDER AN OBLIGATION TO TRANSFER THE INFRASTRUCTURE FACILITY TO THE GOVERNM ENT OF MAHARASHTRA FREE OF CHARGE. IN ACCORDANCE WITH AGREEMENT ASSESSEE INCU RRED EXPENDITURE TO THE TUNE OF RS.152 50 36 995/- TILL THE END OF THE PREC EDING YEAR AND RS.7 40 01 073/- DURING THE YEAR UNDER CONSIDERATIO N FOR THE DEVELOPMENT OF THE SAID INFRASTRUCTURE FACILITY. IN CONSIDERATION AND IN TERMS OF THE AGREEMENT WITH THE GOVERNMENT OF MAHARASHTRA ASSESSEE WAS BE STOWED WITH A RIGHT TO COLLECT TOLL FROM THE MOTORISTS USING THE ROAD FACI LITY DURING THE SPECIFIED PERIOD W.E.F. 06.07.2005. THE ASSESSEE CAPITALIZED THE CON STRUCTION AND DEVELOPMENT COST OF THE INFRASTRUCTURE FACILITY UNDER THE HEAD LICENSE TO COLLECT TOLL AND CLAIMED THE SAME TO BE AN INTANGIBLE ASSET WITHIN T HE MEANING OF SECTION 32(1)(II) OF THE ACT AND THUS CLAIMED DEPRECIATION @ 25% AMOUNTING TO RS.30 04 85 739/-. IN THE ASSESSMENT PROCEEDINGS I N TERMS OF THE DIRECTIONS OF THE ADDITIONAL COMMISSIONER OF INCOME TAX UNDER SECTION 144A OF THE ACT THE ASSESSING OFFICER HELD THAT ASSESSEE WAS NOT EN TITLED FOR DEPRECIATION ON THE LICENSE TO COLLECT TOLL. ACCORDINGLY THE DEP RECIATION CLAIMED AT RS.30 04 85 739/- WAS DENIED. THE AFORESAID ACTION OF THE ASSESSING OFFICER WAS CARRIED IN APPEAL BEFORE THE CIT(A). BEFORE THE CIT(A) ASSESSEE JUSTIFIED ITS CLAIM FOR DEPRECIATION IN TERMS OF SECTION 32(1 )(II) OF THE ACT ON THE BASIS OF THE FOLLOWING DECISIONS OF THE TRIBUNAL :- (I) RELIANCE PORTS AND TERMINALS LTD. IN ITA NO. 17 43 TO 1745/MUM/07 DATED 26.11.2007 OF THE MUMBAI BENCH; A ND (II) ASHOKA INFO PVT. LTD. IN ITA NO. 44/PN/07 DATE D 31.12.2008 OF THE PUNE BENCH. 5. THE CIT(A) HOWEVER DID NOT ACCEPT THE PLEA OF TH E ASSESSEE AND HELD THAT THE LICENSE TO COLLECT TOLL WAS NOT AN INTAN GIBLE ASSET FALLING WITHIN THE PURVIEW OF SECTION 32(1)(II) OF THE ACT. IN COMING TO SUCH CONCLUSION THE CIT(A) ALSO REFERRED TO THE JUDGEMENT OF THE HONBL E JURISDICTIONAL HIGH COURT IN CIT VS. TECHNO SHARES AND STOCKS LTD. (2009) 225 CTR 337 (BOM.). ITA NO. 989/PN/2010 ITA NO. 1105/PN/2010 A.Y. 2007-08 AGAINST THE AFORESAID DECISION OF THE CIT(A) ASSES SEE IS IN FURTHER APPEAL BEFORE US BY WAY OF THE AFORESAID GROUND. 6. AT THE TIME OF HEARING IT WAS A COMMON POINT BE TWEEN THE PARTIES THAT AN IDENTICAL ISSUE HAS BEEN CONSIDERED BY THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF ASHOKA INFRAWAYS PVT. LTD. VS. ACIT VID E ITA NOS. 185 & 186/PN/2012 DATED 29.04.2013. AS PER THE TRIBUNAL F OLLOWING THE PRECEDENTS BY WAY OF VARIOUS DECISIONS OF DIFFERENT BENCHES OF THE TRIBUNAL MENTIONED THEREIN THE CLAIM OF THE ASSESSEE FOR TREATING THE LICENSE TO COLLECT TOLL AS AN INTANGIBLE ASSET ELIGIBLE FOR THE CLAIM OF DEPRECIA TION @ 25% AS PER SECTION 32(1)(II) OF THE ACT WAS JUSTIFIED. THE FOLLOWING D ISCUSSION IN THE ORDER OF THE TRIBUNAL DATED 29.04.2013 (SUPRA) IS RELEVANT :- 7. BEFORE US IT WAS A COMMON POINT BETWEEN THE PA RTIES THAT THE IMPUGNED ISSUE HAS BEEN ADJUDICATED IN FAVOUR OF TH E ASSESSEE IN THE FOLLOWING DECISIONS OF THE TRIBUNAL:- I) ASHOKA BUILDCON LTD. IN ITA.NO.1302/PN/09 DATED 20.03.2012. II) M/S.KALYAN TOLL INFRASTRUCTURE LTD. IN ITA.NOS. 201 & 247/IND/2008 DATED 14.12.2010. III) DIMENSION CONSTRUCTION PVT. LTD. IN ITA.NO.222 223 233 & 857/PN/2009 DATED 18.03.2011. IV) ASHOKA INFO (P) LTD. (SUPRA) V) RELIANCE PORTS AND TERMINALS LTD. (SUPRA). 8. THE LD. CIT(DR) APPEARING FOR THE REVENUE HAS S UBMITTED THAT THE INTANGIBLE ASSETS ELIGIBLE FOR DEPRECIATION IN SE CTION 32(1)(II) OF THE ACT ARE ONLY THOSE WHICH ARE OWNED BY THE ASSESSEE AND HAVE BEEN ACQUIRED AFTER SPENDING MONEY. IN THE CASE OF THE ASSESSEE BY WA Y OF AN AGREEMENT ASSESSEE WAS AWARDED A WORK TO CONSTRUCT A ROAD BY USING OWN FUNDS AND THE EXPENDITURE INCURRED WAS ALLOWED TO BE REIMBURSED B Y PERMITTING THE ASSESSEE A CONCESSION TO COLLECT TOLL/FEES FROM THE MOTORISTS USING THE ROAD. THEREFORE IT COULD NOT BE SAID THAT SUCH A RIGHT W AS WITHIN THE PURVIEW OF SECTION 32(1)(II) OF THE ACT. HOWEVER THE LD. CIT( DR) HAS NOT CONTESTED THE FACTUAL MATRIX THAT IDENTICAL ISSUE HAS BEEN CONSID ERED BY OUR COORDINATE BENCHES IN THE CASE OF ASHOKA BUILDCON LTD. (SUPRA) KALYAN TOLL INFRASTRUCTURE LTD. (SUPRA) DIMENSION CONSTRUCTION PVT. LTD. (SUPRA) AND ASHOKA INFO (P) LTD. (SUPRA). 9. ON THE OTHER HAND THE LD. REPRESENTATIVE FOR TH E RESPONDENT ASSESSEE POINTED OUT THAT THE AFORESAID ARGUMENT SE T UP BY THE REVENUE HAS ALSO BEEN CONSIDERED IN THE AFORESAID PRECEDENTS BE FORE CONCLUDING THAT THE IMPUGNED RIGHT TO COLLECT TOLL WAS AN INTANGIBLE ASSET ELIGIBLE FOR CLAIM OF DEPRECIATION @ 25% AS PER SEC. 32(1)(II) OF THE ACT . 10. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS. FACTUALLY SPEAKING THERE IS NO DISPUTE TO THE FACT THAT THE COSTS CAPITALISED BY THE ITA NO. 989/PN/2010 ITA NO. 1105/PN/2010 A.Y. 2007-08 ASSESSEE UNDER THE HEAD LICENSE TO COLLECT TOLL H AVE BEEN INCURRED FOR DEVELOPMENT AND CONSTRUCTION OF THE INFRASTRUCTURE FACILITY I.E. DEWAS BY-PASS ROAD. IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE WAS TO BUILD OPERATE AND TRANSFER THE SAID INFRASTRUCTURE FACILITY IN TERMS OF AN AGREEMENT WITH THE GOVERNMENT OF MADHYA PRADESH. THE EXPENDITURE ON D EVELOPMENT CONSTRUCTION AND MAINTENANCE OF THE INFRASTRUCTURE FACILITY FOR A SPECIFIED PERIOD WAS TO BE INCURRED BY THE ASSESSEE OUT OF IT S OWN FUNDS. MOREOVER AFTER THE END OF THE SPECIFIED PERIOD ASSESSEE WAS TO TRANSFER THE SAID INFRASTRUCTURE FACILITY TO THE GOVERNMENT OF MADHYA PRADESH FREE OF CHARGE. IN CONSIDERATION OF DEVELOPING CONSTRUCTING MAINTAIN ING THE FACILITY FOR A SPECIFIED PERIOD AND THEREAFTER TRANSFERRING IT TO THE GOVERNMENT OF MADHYA PRADESH FREE OF CHARGE ASSESSEE WAS GRANTED A RIG HT TO COLLECT TOLL FROM THE MOTORISTS USING THE SAID INFRASTRUCTURE FACILITY DU RING THE SPECIFIED PERIOD. THE SAID RIGHT TO COLLECT THE TOLL IS EMERGING AS A R ESULT OF THE COSTS INCURRED BY THE ASSESSEE ON DEVELOPMENT CONSTRUCTION AND MAINT ENANCE OF THE INFRASTRUCTURE FACILITY. SUCH A RIGHT HAS BEEN ADJ UDICATED BY THE TRIBUNAL IN THE AFORESAID PRECEDENTS TO BE IN THE NATURE OF INTANG IBLE ASSET FALLING WITHIN THE PURVIEW OF SECTION 32(1)(II) OF THE ACT AND HAS BEE N FOUND ELIGIBLE FOR CLAIM OF DEPRECIATION. NO DECISION TO THE CONTRARY HAS BEEN CITED BY THE LD. DR BEFORE US AND THEREFORE WE FIND NO REASONS TO DEPART FRO M THE ACCEPTED POSITION BASED ON THE AFORESAID DECISIONS. 11. SO HOWEVER THE PLEA OF THE LD. DR BEFORE US IS TO THE EFFECT THAT THE IMPUGNED RIGHT IS NOT OF THE NATURE REFERRED TO IN SECTION 32(1)(II) OF THE ACT FOR THE REASON THAT THE AGREEMENT WITH THE GOVERNMENT O F MADHYA PRADESH ONLY ALLOWED THE ASSESSEE TO RECOVER THE COSTS INCURRED FOR CONSTRUCTING THE ROAD FACILITY WHEREAS SECTION 32(1)(II) OF THE ACT REQUI RED THAT THE ASSETS MENTIONED THEREIN SHOULD BE ACQUIRED BY THE ASSESSEE AFTER SP ENDING MONEY. THE SAID ARGUMENT IN OUR VIEW IS FACTUALLY AND LEGALLY MISPL ACED. FACTUALLY SPEAKING IT IS WRONG TO SAY THAT IMPUGNED RIGHT ACQUIRED BY THE ASSESSEE WAS WITHOUT INCURRENCE OF ANY COST. IN FACT IT IS QUITE EVIDEN T THAT ASSESSEE GOT THE RIGHT TO COLLECT TOLL FOR THE SPECIFIED PERIOD ONLY AFTER IN CURRING EXPENDITURE THROUGH ITS OWN RESOURCES ON DEVELOPMENT CONSTRUCTION AND MAIN TENANCE OF THE INFRASTRUCTURE FACILITY. SECONDLY SECTION 32(1)(II ) PERMITS ALLOWANCE OF DEPRECIATION ON ASSETS SPECIFIED THEREIN BEING INT ANGIBLE ASSETS WHICH ARE WHOLLY OR PARTLY OWNED BY THE ASSESSEE AND USED FOR THE PURPOSES OF ITS BUSINESS. THE AFORESAID CONDITION IS FULLY SATISFIE D BY THE ASSESSEE AND THEREFORE CONSIDERED IN THE AFORESAID PERSPECTIVE W E FIND NO JUSTIFICATION FOR THE PLEA RAISED BY THE REVENUE BEFORE US. 12. IN THE RESULT WE AFFIRM THE ORDER OF THE CIT(A ) IN HOLDING THAT THE ASSESSEE WAS ELIGIBLE FOR DEPRECIATION ON THE RIGH T TO COLLECT TOLL BEING AN INTANGIBLE ASSET FALLING WITHIN THE PURVIEW OF SE CTION 32(1)(II) OF THE ACT FOLLOWING THE AFORESAID PRECEDENTS. 7. IN TERMS OF THE AFORESAID PRECEDENT THE CLAIM O F THE ASSESSEE IN THE PRESENT CASE FOR DEPRECIATION ON LICENSE TO COLLEC T TOLL BEING AN INTANGIBLE ASSET FALLING WITH THE SCOPE OF SECTION 32(1)(II) OF THE ACT IS LIABLE TO BE UPHELD. WE HOLD SO. ITA NO. 989/PN/2010 ITA NO. 1105/PN/2010 A.Y. 2007-08 8. IN SO FAR AS THE RELIANCE PLACED BY THE CIT(A) O N THE JUDGEMENT OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF TECHNO SHA RES AND STOCKS LTD. (SUPRA) IS CONCERNED IT MAY ONLY BE NOTED THAT THE SAID JUDGEMENT HAS SINCE BEEN ALTERED BY THE HONBLE SUPREME COURT VIDE ITS ORDER REPORTED AT (2010) 327 ITR 323 (SC). ACCORDINGLY IN VIEW OF THE AFORE SAID DISCUSSION WE HEREBY ALLOW THE GROUND OF APPEAL NO. 1.1 RAISED BY THE AS SESSEE. 9. GROUND OF APPEAL NOS. 1.2 AND 1.3 RAISED BY THE ASSESSEE ARE ALTERNATIVE PLEAS WHICH READ AS UNDER :- 1.2 THE LEARNED CIT(A) ERRED IN REJECTING APPELLAN TS CLAIM TO FIRST CREDIT THE ENTIRE TOLL COLLECTION AGAINST THE COST OF CONSTRUCTION OF THE ROAD AND NOT TO TREAT THE SAME AS INCOME TILL THE ENTIRE COS T OF CONSTRUCTION OF THE INFRASTRUCTURE FACILITY IS RECOUPED. HE FAILED TO A PPRECIATE THE PROVISIONS OF SECTION 43(1) OF THE INCOME TAX ACT AND THE DECISIO N OF THE HONBLE SUPREME COURT IN THE CASE OF HOSHIARPUR ELECTRIC SUPPLY CO. VS. CIT (41 ITR 608). THEREFORE IT IS PRAYED THAT THE NET TOLL COLLECTI ON REMAINING AFTER EXPENSES ON COLLECTION BE ALLOWED TO BE DEDUCTED FIRST FROM TH E COST OF CONSTRUCTION OF THE INFRASTRUCTURE FACILITY TILL ITS ENTIRE RECOUPMENT. 1.3 THE LEARNED CIT(A) ERRED IN NOT CONSIDERING THE ASSET CREATED ON INCURRING OF EXPENDITURE ON CONSTRUCTION OF THE INFRASTRUCTURE FACILITY AS PLANT ELIGIBLE FOR DEPRECIATION @ 15%. HE FAILED TO APPRECIATE THE SUBMISSIONS MADE IN THIS CONNECTION AND THE FACT TH AT THE INFRASTRUCTURE FACILITY CONSTRUCTED BY THE APPELLANT CONSTITUTED AN APPARAT US USED FOR THE PURPOSES OF BUSINESS. THEREFORE IT IS PRAYED THAT THE ASSET CREATED ON INCURRING EXPENDITURE OF CONSTRUCTION ON INFRASTRUCTURE FACIL ITY BE HELD AS PLANT. 10. AT THE TIME OF HEARING THE LEARNED COUNSEL FAI RLY SUBMITTED THAT ONCE THE ASSESSEE SUCCEEDS ON ITS SUBSTANTIVE GROUND OF APPEAL NO. 1.1 THE AFORESAID ALTERNATIVE GROUND BECOMES INFRUCTUOUS. A CCORDINGLY THE SAME IS DISMISSED AS INFRUCTUOUS. 11. BY WAY OF GROUND OF APPEAL NO. 2 ASSESSEE HAS CLAIMED DEDUCTION UNDER SECTION 80-IA(4) OF THE ACT WITH RESPECT TO T HE PROFITS FROM THE INFRASTRUCTURE FACILITY. THE SAID CLAIM WAS NOT MAD E IN THE RETURN OF INCOME AS THE ASSESSEE HAD DECLARED A LOSS IN THE RETURN ON A CCOUNT OF DEPRECIATION CLAIMED ON LICENSE TO COLLECT TOLL IN TERMS OF SE CTION 32(1)(II) OF THE ACT. SINCE THE CLAIM OF DEPRECIATION WAS DISALLOWED IN A SSESSMENT PROCEEDINGS ITA NO. 989/PN/2010 ITA NO. 1105/PN/2010 A.Y. 2007-08 RESULTING IN A POSITIVE INCOME ASSESSEE CLAIMED DE DUCTION UNDER SECTION 80- IA(4) OF THE ACT WITH RESPECT TO THE PROFITS OF THE INFRASTRUCTURE FACILITY BEFORE THE CIT(A). THE CIT(A) DID NOT ALLOW THE CLAIM OF THE A SSESSEE AND THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 12. ON THIS POINT ALSO THE LEARNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE SAID ISSUE WOULD BE RENDERED INFRUCTUOUS IN CAS E ASSESSEE SUCCEEDS ON GROUND OF APPEAL NO. 1.1. ACCORDINGLY THE AFORESAI D GROUND IS ALSO DISMISSED. 13. IN THIS MANNER THE APPEAL OF THE ASSESSEE IS P ARTLY ALLOWED. 14. NOW WE MAY TAKE-UP THE CROSS-APPEAL OF THE REV ENUE WHEREIN THE FOLLOWING TWO GROUNDS HAVE BEEN RAISED BY THE REVEN UE :- 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE CLAIM OF U NABSORBED DEPRECIATION OF RS.28 88 64 777/- PERTAINING TO A.Y. 2006-07 WHEN T HE ASSESSEE HAD NOT CLAIMED THE SAME IN ITS RETURN OF INCOME FILED UNDE R SECTION 139 FOR A.Y. 2007-08 AND THEREBY NOT APPLYING THE LAW LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT (2 006) 284 ITR 323 (SC)? 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE ASSESSEE T HE BENEFIT OF DEPRECIATION @ 10% ELIGIBLE FOR BUILDINGS AND MISTAKENLY APPLYING THE RATIO OF THE DECISION OF THE ORDER OF THE ITAT C BENCH OF CHENNAI IN THE CAS E OF TAMIL NADU ROAD DEVELOPMENT CO. LTD. VS. ACIT 123 TTJ 702 WHEN THE ASSESSEE HAD NOT CONSTRUCTED THE SAID ROAD AS A PART OF EXPANSION OF AND TO GIVE ACCESS TO BUILDINGS BUT HAD CONSTRUCTED THE SAID ROAD AS A PA RT OF CONTRACT TO CONSTRUCT HIGHWAYS? 15. IN SO FAR AS THE FIRST GROUND IS CONCERNED IT R ELATES TO THE ALLOWANCE OF UNABSORBED DEPRECIATION REMAINING AFTER ASSESSING T HE INCOME FOR THE EARLIER ASSESSMENT YEAR 2006-07. BEFORE THE CIT(A) ASSESSE E SUBMITTED THAT WHILE DETERMINING THE TOTAL INCOME FOR THE YEAR UNDER CON SIDERATION THE ASSESSING OFFICER DID NOT ALLOW ANY ALLOWANCE FOR UNABSORBED DEPRECIATION BROUGHT FORWARD FROM EARLIER YEARS. AS PER THE MATERIAL ON RECORD THE CIT(A) FOUND THAT UNABSORBED DEPRECIATION TO THE TUNE OF RS.28 88 777 /- FOR THE ASSESSMENT ITA NO. 989/PN/2010 ITA NO. 1105/PN/2010 A.Y. 2007-08 YEAR 2006-07 WAS AVAILABLE FOR ADJUSTMENT AGAINST C URRENT YEARS INCOME. HE THEREFORE DIRECTED THE ASSESSING OFFICER TO ALLOW THE BENEFIT OF THE SAME TO THE ASSESSEE WHILE DETERMINING THE TOTAL INCOME FOR THE YEAR UNDER CONSIDERATION. AGAINST THE AFORESAID REVENUE IS IN APPEAL BEFORE US. 16. APART FROM OBSERVING THAT THERE IS NO MATERIAL TO NEGATE THE FACTUAL APPRECIATION MADE BY THE CIT(A) THE LEARNED CIT(DR ) SUBMITTED THAT THE AFORESAID ISSUE WOULD BE RENDERED INFRUCTUOUS ONCE THE CLAIM OF THE ASSESSEE FOR DEPRECIATION @ 25% ON THE LICENSE TO COLLECT T OLL IS ALLOWED AS THE SAME WOULD RESULT INTO A NEGATIVE TOTAL INCOME FOR THE Y EAR UNDER CONSIDERATION. THEREFORE CONSIDERING THE AFORESAID TWIN REASONS T HE GROUND OF APPEAL RAISED BY THE REVENUE IS DISMISSED. 17. THE SECOND GROUND RAISED BY THE REVENUE IS WITH REGARD TO THE ACTION OF THE CIT(A) IN ALLOWING DEPRECIATION @ 10% ON THE INFRASTRUCTURE FACILITY CONSIDERING THE SAME AS BUILDING. ONCE THE ASSESS EE WAS FOUND NOT ELIGIBLE FOR THE CLAIM FOR DEPRECIATION @ 25% ON LICENSE TO COLLECT TOLL IN TERMS OF SECTION 32(1)(II) OF THE ACT THE CIT(A) PROCEEDED TO ALLOW THE DEPRECIATION ON THE ROAD FACILITY @ 10% TREATING IT TO BE IN THE N ATURE OF BUILDING. AGAINST SUCH ALLOWANCE REVENUE IS IN APPEAL BEFORE US. 18. IT WAS A COMMON POINT BETWEEN THE PARTIES THAT THE AFORESAID ISSUE IS RENDERED INFRUCTUOUS AS ASSESSEE HAS SUCCEEDED IN I TS SUBSTANTIVE CLAIM OF DEPRECIATION ON LICENSE TO COLLECT TOLL @ 25% IN TERMS OF SECTION 32(1)(II) OF THE ACT. AS A RESULT THE AFORESAID ISSUE IS DISMIS SED AS INFRUCTUOUS IN VIEW OF OUR DECISION ON GROUND OF APPEAL NO. 1.1 IN CROSS-A PPEAL OF THE ASSESSEE. 19. THUS THE APPEAL OF THE REVENUE IS DISMISSED. ITA NO. 989/PN/2010 ITA NO. 1105/PN/2010 A.Y. 2007-08 20. RESULTANTLY WHEREAS THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED THAT OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH JULY 2013. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE DATED: 18 TH JULY 2013 SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-V PUNE; 4) THE CIT-V PUNE; 5) THE DR B BENCH I.T.A.T. PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T. PUNE.