ITO, UDAIPUR v. M/s. Alfa Earthmovers, UDAIPUR

ITA 191/JODH/2013 | 2008-2009
Pronouncement Date: 23-10-2013 | Result: Dismissed

Appeal Details

RSA Number 19123314 RSA 2013
Assessee PAN AAKFA5784F
Bench Jodhpur
Appeal Number ITA 191/JODH/2013
Duration Of Justice 6 month(s) 22 day(s)
Appellant ITO, UDAIPUR
Respondent M/s. Alfa Earthmovers, UDAIPUR
Appeal Type Income Tax Appeal
Pronouncement Date 23-10-2013
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 22-10-2013
Date Of Final Hearing 22-10-2013
Next Hearing Date 22-10-2013
Assessment Year 2008-2009
Appeal Filed On 01-04-2013
Judgment Text
IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MARATHA JUDICIAL MEMBER AND SHRI N.K. SAINI ACCOUNTANT MEMBER. ITA NO.191/JODH/2013 (A.Y. 2008-09) ITO WARD-1(2) VS. M/S. ALFA EARTHMOVERS UDAIPUR 21/211 KHANJIPEER UDAIPUR. PAN NO. AAKFA 5784 F (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI U.C. JAIN & SHRI RAJENDRA JAIN DEPARTMENT BY : SHRI N.A. JOSHI- D.R. DATE OF HEARING : 22/10/2013. DATE OF PRONOUNCEMENT : 23/10/2013. O R D E R PER N.K.SAINI A.M THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE OR DER DATED 30/01/2013 OF LD. CIT (A) UDAIPUR. THE ONLY GROUN D RAISED IN THIS APPEAL READS AS UNDER:- ON THE FACTS AND IN THE PRESENT CIRCUMSTANCES OF T HE CASE THE LEARNED CIT(A) HAS ERRED IN:- 2 1. ON THE FACTS AND IN THE PRESENT CIRCUMSTANCE OF THE CASE THE LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 22 56 453/- MADE ON ACCOUNT OF DISALLOWANCE OF DEPRECIATION IGNORING TH E FACT THAT THE ASSESSEE IS ENGAGED IN CONTRACT WORK AND NOT ENGAGE D IN HIRING OF VEHICLES OR MACHINERIES AND THUS ENTITLED FOR DEPRE CIATION @ 15% AS AGAINST 30% CLAIMED. THAT THE APPELLANT CRAVES TO ADD AMEND ALTER DEL ETE OR MODIFY ANY OR ALL THE ABOVE GROUNDS OF APPEAL BEFORE OR AT THE TIME O F HEARING. 2. FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE H AD CLAIMED DEPRECIATION @ 30% AMOUNTING TO RS. 45 29 285/- ON BLOCK OF ASSETS CLAIMING THAT IT WAS ENGAGED IN BUSINESS OF RUNNING HEAVY CARRIAGE GOODS VEHICLE ON HIRE WHICH WERE ELIGIBLE FOR 30% RATE O F DEPRECIATION AS PER APPENDIX-I RULE 5 OF THE I.T. RULES 1962. THE AS SESSING OFFICER HOWEVER ALLOWED THE DEPRECIATION @ 15% ONLY BY HOL DING THAT THE ASSESSEE IN THE YEAR UNDER CONSIDERATION WAS ENGAGE D IN THE WORK OF EXECUTION OF CONTRACT FOR WHICH DEPRECIATION WAS A LLOWED @ 15% AS AGAINST THE CLAIM OF 30% MADE BY THE ASSESSEE. ACC ORDINGLY DISALLOWANCE OF RS. 22 56 453/- WAS MADE. 3. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LEARNED CIT(A) WHO DELETED THE DISALLOWANCE MADE BY THE AS SESSING OFFICER BY OBSERVING AS UNDER:- V.IV) I HAVE CONSIDERED THE SUBMISSIONS OF THE APP ELLANT AS WELL AS THE ASSESSMENT ORDER. IT IS SEEN THAT THE ASSESSEE HAS EXECUTED THE WORK WHICH WAS AWARDED BY THE FOLLOWING PARTIES. 3 1. M/S. NAGARJUNA CONSTRUCTION CO. RS.1 07 48 519 2. M/S. IVRC LNFRASTRUCTURE RS.0 19 39 739 3. M/S. SUNWAY CONSTRUCTION RS.0 13 66 392 AS PER THE CONTRACT DETAILS AVAILABLE ON RECORD TH E WORK ORDER WAS GIVEN BY THE ADDL. CHIEF ENGINEER PHED REGION AJMER TO M/S. NAGARJUNA CONSTRUCTION CO. FOR EXECUTION OF WORK OF ADVANCEME NT PART OF BISALPUR WATER SUPPLY PROJECT PHASE-LL AJMER. SUBSEQUENT TO THIS M/S.NAGARJUNA CONSTRUCTION CO. LIMITED ISSUED WORK ORDER TO THE A PPELLANT FOR EXCAVATION OF 15ML CWR PUMP HOUSE AT KEKRI AND HIRE CHARGES OF HITACHI 200 ON HOURLY BASIS. THE SCOPE OF THE WORK WAS AS UNDER: SIMILARLY IVRCL INFRASTRUCTURE PVT. LIMITED HAS GI VEN EXCAVATION OF EARTH AND LOADING WORK FINISHED MATERIALS SUCH AS GSB AG G BOULDER ETC USING HYDRAULIC EXCAVATOR INCLUDING THE COST OF HIRE CHAR GES OF EXCAVATOR ALL MAINTENANCE OPERATOR AND HELPERS SALARY FOOD AND ACCOMMODATION EXPENSES. FURTHER SUNWAY CONSTRUCTION SDN BHD HAS TAKEN TAT HITACHI EX-200 ON RENTAL BASIS WITH SPECIFIC TERMS AND COND ITION FOR EXECUTING THE ROAD PROJECTS. FROM THE ABOVE IT IS APPARENT THAT M AINLY THE ASSESSEES MAIN RECEIPTS FROM NAGARJUNA CONSTRUCTION CO LIMIT ED AND IVRCL LTD WHICH IS ENGAGED HYDRAULIC EXCAVATOR -200 ON HIRE B ASIS AND PAYMENT HAS S.NO. DESCRIPTION UNIT RATE 1 ENGAGEMENT OF HITACHI 200 ON HIRE BASIS INCLUDING DIESEL FOR 1300/1500/1600 M .M DIA MS PIPLINE HOUR 1200.00 2 EXCAVATION OF SOIL FOR 15 ML CWR AT KEKRI H/WS CUM 60.00 3 EXCAVATION OF SOFT FOR 15 ML CWR AT KEKRI H/WS CUM 162.00 4 EXCAVATION OF HARD -ROCK FOR 15 ML CWR AT KEKRI H/WS CUM 250.00 5 EXCAVATION OF HARD -ROCK FOR PUMP HOUSE KEKRI H/WS CUM 250.00 6 EXCAVATION OF HARD -ROCK FOR WTP KEKRI H/WS CUM 250.00 4 BEEN MADE ON HOURLY BASIS. SIMILARLY IVRCL HAS PA ID HIRE CHARGES ON MONTHLY BASIS FOR THE EXCAVATOR I.E. L & T KOMAATUS PC-200. FROM THE ABOVE CONTRACT IT IS APPARENT THAT THE AP PELLANT HAS NOT BEEN GIVEN THE SUB CONTRACT AS SUCH BUT HAS RECEIVED THE PAYMENT FOR SUPPLYING MACHINERIES TO THE ABOVE PARTIES AND SPECIFIC MENTI ON OF MACHINERIES ALONG WITH RENT ETC. HAS BEEN MENTIONED. THE APPELL ANT WAS TO SUPPLY THE MACHINERIES WHICH HAS TO WORK UNDER THE SUPERVISION OF THE CONTRACTEE AND THE MACHINES WERE OPERATED BY THE APPELLANT'S M AN POWER. IT IS NOT A CASE WHERE THE ASSESSEE HAS GOT ANY CONTRACT FOR EX ECUTING THE SPECIFIC WORK WITH ANY TYPE OF MACHINERY. IN VIEW OF ABOVE DISCUSSION IT IS HELD THAT THE A PPELLANT IS ENTITLED FOR CLAIMING THE DEPRECIATION AT THE RATE OF 30% AND TH EREFORE THE DISALLOWANCE MADE OF RS.22 56 453 IS NOT TENABLE AN D THE SAME IS DELETED. THIS GROUND OF APPEAL IS ACCORDINGLY ALLOWED. NOW THE DEPARTMENT IS IN APPEAL. 4. DURING THE COURSE OF HEARING LEARNED COUNSEL FOR THE ASSESSEE AT THE VERY OUTSET STATED THAT THIS ISSUE IS FULLY COV ERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE DEPARTMENT VIDE ORDER DATE D 10/07/2013 OF THIS BENCH OF THE TRIBUNAL IN ITA NO. 135/JODH/2013 FOR THE A.Y. 2007-08 IN THE CASE OF ITO WARD-1(4) UDAIPUR VS. M/S. KESHRI YAJI MINERALS PVT. LTD. UDAIPUR COPY OF THE SAID ORDER WAS FURNISHED WHIC H IS PLACED ON RECORD. 5. IN HIS RIVAL SUBMISSIONS LEARNED D.R. ALTHOUGH SU PPORTED THE ASSESSMENT ORDER DATED 13/12/2010 PASSED BY THE ASS ESSING OFFICER BUT COULD NOT CONTROVERT THE AFORESAID CONTENTION OF TH E LEARNED COUNSEL FOR THE ASSESSEE. 5 6 . WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PA RTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RE CORD. IT IS NOTICED THAT THE PRESENT ISSUE IS SQUARELY COVERED VIDE ORD ER DATED 10/07/2013 PASSED BY THIS BENCH OF THE I.T.A.T. IN THE CASE OF ITO UDAIPUR VS. M/S. KESHRIYAJI MINERALS PVT. LTD. UDAIPUR (SUPRA) WHER EIN THE RELEVANT OBSERVATIONS ARE GIVEN IN PARA 7 TO 10 WHICH ARE R EPRODUCED VERBATIM AS UNDER:- 7. THE NEXT ISSUE VIDE GROUND NO. 2 RELATES TO THE DELETION OF DISALLOWANCE OF RS.1 41 298/- ON ACCOUNT OF EXCESS DEPRECIATION ON DUMPERS. 8. THE FACTS RELATED TO THIS ISSUE IN BRIEF ARE THAT THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS NOTICED THAT THE ASSESSEE HAD CLAIMED DEPRECIATION OF RS.2 82 597/- @30% ON THE DUMPERS WHILE THE ALLOWABLE RATE OF DEPRECIATION WA S ONLY 15%. WHEN ASKED TO JUSTIFY THE SAME THE ASSESSEE SUBMIT TED AS UNDER: '1. THE DEPRECIATION OF DUMPER IS CLAIMED @30% CO NSIDERING THEIR MOTOR LORRIES USED IN A BUSINESS OF RUNNING THEM ON HIRE. THE DUMPERS ARE USED TO TRANSPORT THE MATERIAL ONLY AND ALSO IT SATISFIED THE DEFINITION OF MOTOR VEHICLE ACT. THE DUMPERS AR E ALSO REGISTERED UNDER THE MOTOR VEHICLE ACT THE PHOTOCOPIES OF REG ISTRATION CERTIFICATES ARE ALREADY SUBMITTED.' 8.1 HOWEVER THE ASSESSING OFFICER DID NOT FIND ME RIT IN THE SUBMISSIONS OF THE ASSESSEE BY OBSERVING THAT TIPPERS WERE NON- TRANSPORT VEHICLES ALTHOUGH REGISTERED UNDER MOTOR VEHICLE AC T. HE FURTHER OBSERVED THAT THE DEPRECIATION @30% WAS AVAILABLE T O THE VEHICLES WHICH ARE IN THE NATURE OF LORRY HAVING CAPACITY AN D CAPABILITY FOR CARRYING ON GOODS OR OTHER ITEMS. HE FURTHER STATED THAT THE DUMPER COMES WITHIN THE EXPRESSION OF EARTH MOVING MACHINE RY. THE 6 RELIANCE WAS PLACED ON THE DECISION OF HON'BLE GUWA HATI HIGH COURT IN THE CASE OF CIT VS. SIBSON CONSTRUCTION COMPANY 221 ITR 468 (GAUHATI). THE ASSESSING OFFICER ALSO OBSERVED THAT THE ASSESSEE WAS NOT IN THE BUSINESS OF RUNNING THE MOTOR BUSES/MOTO R LORRIES ON HIRE AND THE HIRING BUSINESS OF THE ASSESSEE WAS WITH RE GARD TO THE PLANT & MACHINERY PERTAINING TO THE MARBLE BUSINESS RATHE R THAN THE BUSINESS OF RUNNING MOTOR BUSES/MOTOR LORRIES ON HI RE ON WHICH 30% DEPRECIATION WAS ALLOWED. THE ASSESSING OFFICER HEL D THAT THE ASSESSEE WAS ENTITLED FOR DEPRECIATION @15% AND THE RELIANCE WAS PLACED ON THE FOLLOWING CASE LAWS: (I) CIT VS. SARDAR STONES 215 ITR 350 (RAJ) (II) CIT VS. AR ENTERPRISES P. LTD. IN DBIT NO. 7 7/2002 DATED 06/09/2007 9. THE ASSESSEE CARRIED THE MATTER TO THE LEARNED CIT(A) AND SUBMITTED AS UNDER: OUR HUMBLE SUBMISSION ON THE SECOND POINT OF THE A PPEAL IS THAT THE APPELLANT IS ALSO HAVING BUSINESS OF HIRING OF MINING MACHINERIES AND EQUIPMENTS. THE DUMPERS ALSO USED FOR TRANSPORT VEHICLE ACT. HENCE THE DEPRECIATION CLAIMED MAY BE ALLOWED. 9.1 THE LEARNED CIT(A) AFTER CONSIDERING THE SUBM ISSIONS OF THE ASSESSEE OBSERVED THAT THE ISSUE OF ALLOWABILITY O F DEPRECIATION ON DUMPER/ TIPPER AT THE RATE ON WHICH DEPRECIATION WAS ALLOWA BLE ON TRANSPORT VEHICLE HAD BEEN EXAMINED BY THE JURISDIC TIONAL TRIBUNAL IN THE CASE OF SAYEED IQBAL IN ITA NO.39/JU/2009 FOR T HE ASSESSMENT YEAR 2005-06. THE LEARNED CIT(A) BY FOLLOWING THE DECISION OF THE ITAT JODHPUR BENCH ALLOWED THE CLAIM OF THE ASSESS EE AND HELD THAT THE ASSESSEE WAS ELIGIBLE FOR CLAIMING DEPRECIATION AT THE SAME RATE AT WHICH DEPRECIATION WAS ALLOWABLE ON MOTOR LORRIE S. NOW THE DEPARTMENT IS IN APPEAL. 10. WE HAVE CONSIDERED THE SUBMISSIONS OF LEARNED D.R. AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. IN T HE PRESENT CASE IT APPEARS THAT LEARNED CIT(A) HAS ALLOWED THE CLAIM O F THE ASSESSEE BY FOLLOWING THE DECISION OF THE JURISDICTIONAL TRIBU NAL AND NOTHING IS BROUGHT ON RECORD THAT THE DECISION OF THE ITAT JOD HPUR BENCH 7 RELIED BY THE LEARNED CIT(A) HAVING SIMILAR FACTS HAD BEEN REVERSED BY THE HIGHER FORUM. WE THEREFORE DO NOT SEE ANY MERIT IN THIS GROUND OF THE DEPARTMENTAL APPEAL. 7. SO WE RESPECTFULLY FOLLOWING THE AFORESAID REFERRE D TO ORDER DATED 10/07/2013 IN ITA NO. 135/JODH/2013 IN THE CASE OF ITO UDAIPUR VS. M/S. KESHRIYAJI MINERALS PVT. LTD. UDAIPUR (SUPRA) ( THE FACTS OF WHICH CASE ARE IDENTICAL TO THE FACTS OF THE PRESENT CASE) WE DO NOT SEE ANY VALID GROUND TO INTERFERE WITH THE FINDINGS GIVEN BY THE LEARNED CIT(A). IN THAT VIEW OF THE MATTER WE DO NOT SEE ANY MERIT IN THIS APPEAL OF THE DEPARTMENT. 8. IN THE RESULT APPEAL IS DISMISSED. (ORDER PRONOUNCED IN THE COURT ON 23 RD OCTOBER 2013). SD/- SD/- (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 23 RD OCTOBER 2013. VR/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD.CIT 4. THE CIT(A) 5. THE D.R ASSISTANT REGISTRAR ITAT JODHPUR.