The Surat Peoples Co.Op.Bank Ltd.,, Surat v. The ACIT.,Circle-5,, Surat

ITA 2455/AHD/2011 | 2007-2008
Pronouncement Date: 30-04-2015 | Result: Dismissed

Appeal Details

RSA Number 245520514 RSA 2011
Assessee PAN AAAAT2885P
Bench Ahmedabad
Appeal Number ITA 2455/AHD/2011
Duration Of Justice 3 year(s) 7 month(s)
Appellant The Surat Peoples Co.Op.Bank Ltd.,, Surat
Respondent The ACIT.,Circle-5,, Surat
Appeal Type Income Tax Appeal
Pronouncement Date 30-04-2015
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 30-04-2015
Assessment Year 2007-2008
Appeal Filed On 29-09-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH AHMEDABAD (BEFORE SHRI SHAILENDRA KR. YADAV J.M. & SHRI ANIL CHATURVEDI A.M.) I.T. A. NO. 2455/AHD/2011 (ASSES SMENT YEAR: 2007-08) THE SURAT PEOPLES CO- OPERATIVE BANK LTD. VASUDHARA BHAVAN TIMALIYAWAD NANPURA SURAT V/S THE A.C.I.T. CIRCLE-5 SURAT (APPELLANT) (RESPONDENT) PAN: AAAAT2885P APPELLANT BY : SHRI KAMLESH. N. BHATT A. R. RESPONDENT BY : SMT. SONIA KUMAR SR. D.R. ( )/ ORDER DATE OF HEARING : 24-04-2015 DATE OF PRONOUNCEMENT : 30-04-2015 PER SHRI ANIL CHATURVEDI A.M. 1. THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE OR DER OF CIT(A)-IV SURAT DATED 30.06.2011 FOR A.Y. 2007-08. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. 3. ASSESSEE IS A CO-OPERATIVE SOCIETY ENGAGED IN THE B USINESS OF BANKING. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2007-0 8 ON 24.10.2007 DECLARING TOTAL INCOME OF RS. 17 70 31 490/-. THE C ASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED U NDER SECTION 143(3) VIDE ITA NO 2455/ AHD/2011 . A.Y.2007-08 2 ORDER DATED 30.12.2009 AND THE TOTAL INCOME WAS DET ERMINED AT RS. 16 70 31 491/-. SUBSEQUENTLY A.O NOTICED THAT LOSS ON SALE OF DEPRECIABLE ASSETS ( ELECTRICAL FITTINGS) AMOUNTING TO RS. 10 2 3 600/- WAS ALLOWED AS AN EXPENDITURE. THEREFORE ORDER U/S. 154 OF THE ACT WA S PASSED ON 19.10.2010 AND THE LOSS ON SALE OF DEPRECIABLE ASSETS WAS DISA LLOWED AND THE TOTAL INCOME WAS REVISED AT RS. 16 80 55 154/-. AGGRIEVED BY THE ORDER OF A.O ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO C ONFIRMED THE ACTION OF A.O. AGGRIEVED BY THE AFORESAID ORDER OF LD. CIT( A) ASSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUN D;- 1. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED CIT (A) ERRED IN CONFIRMING THE DISALLOWANCE OF LOSS ON SALE OF DEPR ECIABLE ASSETS I.E. ELECTRIC FITTINGS OF RS. 10 23 600/- AND YOUR APPELLANT PRAYS THAT TH E SAME BE ALLOWED AS CLAIMED BY THE APPELLANT. 4. SUBSEQUENT TO THE PASSING OF ORDER U/S. 143(3) A. O HAD NOTICED THAT WHILE PASSING THE ORDER U/S. 143(3) THE LOSS ON SALE OF E LECTRICAL FITTINGS AMOUNTING TO RS. 10 23 600/- WAS ALLOWED AS AN EXPENDITURE AN D ALLOWING THE LOSS HAS RESULTED IN UNDERSTATEMENT OF INCOME. HE THEREFORE BY RESORTING TO PROVISIONS U/S. 154 DISALLOWED THE LOSS ON SALE OF ASSETS. TH E ACTION OF A.O WAS CONFIRMED BY LD. CIT(A) BY ORDER DATED 30.06.2011 B Y HOLDING AS UNDER:- 4. I HAVE GONE THROUGH THE FACTS. AFTER INTRODUCTION O F CONCEPT OF BLOCK OF ASSETS NO WRITE OFF OF ASSETS CAN BE CLAIMED AS DEDUCTION FOR DETER MINATION OF INCOME UNDER THE I.T. ACT. ON THE ONE HAND THE APPELLANT CLAIMS DEDUCTION OF D EPRECIATION ON THE SAME ASSETS AS THEY HAVE NOT BEEN EXCLUDED FROM THE BLOCK OF ASSET S AND ON THE OTHER IT CLAIMS DEDUCTION OF TOTAL VALUE TREATING THE WRITE OFF AS ADMISSIBLE DEDUCTION FOR INCOME-TAX PURPOSES ALSO. THIS DOUBLE DEDUCTION IS NOT PERMITTED. ASSETS LOSE THEIR INDIVIDUALITY ONCE THEY BECOME PART OF A BLOCK OF ASSET. LOSS ON WRITE OFF OF CAPI TAL ASSET IS NOT ADMISSIBLE DEDUCTION. ADJUSTMENTS TO THE BLOCK HAPPEN AUTOMATICALLY WHEN SALE PROCEEDS (IN THIS CASE ITA NO 2455/ AHD/2011 . A.Y.2007-08 3 INSURANCE CLAIM) WILL BE REDUCED FROM THE BLOCK. WR ONG ACCOUNTING OF INSURANCE CLAIM AND RESULTING EXCESS INCOME IF ANY IN SUBSEQUENT YEAR CANNOT JUSTIFY WRONG TREATMENT IN AN EARLIER YEAR. AS FAR AS THIS YEAR IS CONCERNED CLAIM OF LOSS ON ASSET IS INADMISSIBLE. THE ACTION OF THE A.O. IS THEREFORE UPHELD. THIS GR OUND FAILS. 5. AGGRIEVED BY THE ORDER OF LD. CIT(A) ASSESSEE IS N OW IN APPEAL BEFORE US. BEFORE US LD. A.R. REITERATED THE SUBMISSION MADE BEFORE LD. CIT(A). THE LD. D.R. ON THE OTHER HAND SUPPORTED THE ORDER OF A.O A ND LD. CIT(A). 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT WHILE FRAMING THE ASSESSMENT U/S. 143(3) LOSS OF SALE OF ASSETS WAS ALLOWED BY THE A.O WHICH WAS SUBSEQUENTLY RECTIFIED BY A.O BY PASSING ORDER U/S. 154 OF THE ACT. WE FIND THAT WHILE UPHOL DING THE ORDER OF A.O CIT(A) HAS NOTED THAT AFTER THE INTRODUCTION OF CON CEPT OF BLOCK OF ASSETS NO WRITE OFF OF ASSETS CAN BE CLAIMED AS DEDUCTION AND HAS FURTHER NOTED THAT IF THE CLAIM OF DEDUCTION IS ALLOWED IT WOULD AMOUNT T O DOUBLE DEDUCTION IN THE FORM OF DEPRECIATION AND LOSS WHICH IS NOT PERMISS IBLE. BEFORE US ASSESSEE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO CONTROVER T THE FINDINGS OF LD. CIT(A). WE THEREFORE FIND NO REASON TO INTERFERE WI TH THE ORDER OF LD. CIT(A) AND THUS THE GROUND OF ASSESSEE IS DISMISSED. 7. IN THE RESULT THE APPEAL OF ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 30 - 04 - 2015 . SD/- SD/- (SHAILENDRA KR. YADAV) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER