THE PENFORD (ISRAEL) LTD., v. M/S. DDIT (IT)-4(2),

ITA 4052/MUM/2008 | 2005-2006
Pronouncement Date: 30-03-2011 | Result: Allowed

Appeal Details

RSA Number 405219914 RSA 2008
Assessee PAN AABCP7258D
Bench Mumbai
Appeal Number ITA 4052/MUM/2008
Duration Of Justice 2 year(s) 9 month(s) 23 day(s)
Appellant THE PENFORD (ISRAEL) LTD.,
Respondent M/S. DDIT (IT)-4(2),
Appeal Type Income Tax Appeal
Pronouncement Date 30-03-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted L
Date Of Final Hearing 30-03-2011
Next Hearing Date 30-03-2011
Assessment Year 2005-2006
Appeal Filed On 06-06-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES L : MUMBAI BEFORE SHRI D. MANMOHAN VICE PRESIDENT AND SHRI RAJENDRA SINGH ACCOUNTANT MEMBER ITA. NO. 4052/MUM/2008 ASSESSMENT YEAR 2005-2006 PENFORD (ISRAEL) LIMITED MUMBAI. AABCP7258D VS. THE DY.DIT I.T. 4 (2) MUMBAI 400 038. (APPELLANT) (RESPONDENT) FOR APPELLANT : SHRI NITESH JOSHI FOR RESPONDENT : SHRI ARSI PRASAD ORDER PER D. MANMOHAN V.P. 1. THIS APPEAL BY THE ASSESSEE-COMPANY IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A)-XXXIII MUMBAI AND I T PERTAINS TO THE ASSESSMENT YEAR 2005-2006. THOUGH THE CORE ISSUE I N THE INSTANT CASE PERTAINS TO THE ALLOWABILITY OF DEPRECIATION UNDER SECTION 32 OF THE INCOME TAX ACT THE LEARNED COUNSEL APPEARING ON BEHALF OF THE ASSESSEE RAISED SEVERAL GROUNDS. DURING THE COURSE OF HEARING LEARNED COUNSEL HAS ARGUED ON SEVERAL FACETS CONNEC TED TO THE MAIN GROUND BY FILING THE FOLLOWING ADDITIONAL GROUNDS APART FROM ORALLY RAISING AN ADDITIONAL GROUND WITH REGARD TO TAXABIL ITY OF INCOME ARISING ON ACCOUNT OF FOREIGN EXCHANGE FLUCTUATION. 1. THE LEARNED CIT(A) ERRED IN NOT GIVING ANY FINDING S TO THE WITHOUT PREJUDICE GROUND OF APPEAL OF THE APPELLANT THAT THE ASSESSING OFFICER HAS NOT ALLOWED THE SET OFF O F THE BROUGHT FORWARD BUSINESS LOSSES AND UNABSORBED DEPRECIATION ALLOWANCES OF EARLIER YEARS WHILE COMP UTING THE TAXABLE TOTAL INCOME AGAINST THE INCOME DETERMI NED AFTER DISALLOWING APPELLANTS CLAIM IN RESPECT OF DEPRECIATION ALLOWANCE AND VARIOUS EXPENSES. 2 2. THE APPELLANT SUBMITS THAT THE ASSESSING OFFICER BE DIRECTED TO ALLOW SET OFF OF BROUGHT FORWARD LOSSES AND UNABSORBED DEPRECIATION ALLOWANCES OF EARLIER YEARS . 2. FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSE E-COMPANY WAS INCORPORATED IN ISRAEL AND IS A TAX RESIDENT OF ISRAEL HAVING ITS BRANCH OFFICE AT MUMBAI. THE MAIN BUSINESS OF THE B RANCH OFFICE WAS TRADING IN ROUGH DIAMONDS I.E. IMPORT OF ROUGH DIA MONDS AND SALE THEREOF IN THE INDIAN MARKET. IT APPEARS THAT THE A SSESSEE-COMPANY CARRIED ON THE TRADING ACTIVITY AND IT WAS ACCORDIN GLY ASSESSED TO TAX FROM YEAR TO YEAR UPTO THE ASSESSMENT YEAR 2003-200 4 HAVING OBTAINED THE APPROVAL FROM RBI IN 1999 TO CARRY ON ITS TRADING ACTIVITY IN INDIA. IN THE PRECEDING ASSESSMENT YEAR AS WELL AS IN THE YEAR UNDER CONSIDERATION ASSESSEE HAD NOT CARRIED ON ANY ACTIVITY CONCERNING IMPORT AND SALE OF ROUGH DIAMONDS. PAGE 13 OF THE PAPER BOOK (P & L ACCOUNT FOR THE YEAR ENDED 31 ST MARCH 2005) SHOWS THAT THE ASSESSEE HAS NOT EVEN HIRED SERVICES OF ANY EMP LOYEE IN INDIA TO CARRY ON ITS TRADING ACTIVITY IN THE PREVIOUS YEARS RELEVANT TO THE ASSESSMENT YEARS 2004-2005 AND 2005-2006. SIMILARLY PAGE 12 OF THE PAPER BOOK SHOWS THAT THERE WAS NO STOCK OF ROUGH D IAMONDS IN THESE YEARS AND ASSESSEE HAD NO ACTIVITY OF EITHER PURCHA SE OR SALE OF ROUGH DIAMONDS LEAVE ALONE MAINTAINING ANY STOCK OF ROUG H DIAMONDS (SINCE THE ENTIRE STOCK APPEARS TO HAVE BEEN SOLD O UT IN THE PRECEDING YEARS). IN RESPECT OF THE ASSESSMENT YEAR 2004-2005 ASSESSEE DECLARED INCOME/LOSS AND CLAIMED DEPRECIATION ON THE PREMISE S WHICH WAS EARLIER USED FOR THE PURPOSE OF BUSINESS AND THE RE TURN WAS ACCORDINGLY PROCESSED UNDER SECTION 143 (1) OF THE ACT. HOWEVER IN RESPECT OF THE ASSESSMENT YEAR 2005-2006 THE CASE HAVING BEEN TAKEN UP FOR SCRUTINY THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 143 (2) OF THE ACT AND ALSO CALLED FOR SPEC IFIC DETAILS BY ISSUING A NOTICE UNDER SECTION 142 (1) OF THE ACT IN RESPON SE TO WHICH REPRESENTATIVE OF THE ASSESSEE-COMPANY ALONG WITH T HE CHARTERED ACCOUNTANT APPEARED FROM TIME TO TIME AND FURNISHED RELEVANT MATERIAL. AFTER PERUSING THE MATERIAL PLACED BEFORE HIM THE ASSESSING 3 OFFICER CONCLUDED THAT THE ASSESSEE DISCONTINUED IT S BUSINESS AND THEREFORE DEPRECIATION CANNOT BE CLAIMED IN THE YE AR IN WHICH THERE WAS NO BUSINESS ACTIVITY. IN THIS REGARD HE OBSERV ED AS UNDER : 3.3. THE CONTENTION OF THE ASSESSEE HAS BEEN DULY CONSIDERED BUT THE SAME IS NOT ACCEPTABLE. FURTHER THE ASSESSEE DOES NOT DISPUTE THE FACT THAT NO BUSINESS ACTIVITY HAS BEEN CARRIED OUT DURING THE YEAR AND HAS ALSO SUBMITTED THAT THERE IS NO INTENTION OF THE BUSINESS BEING CARRIED OUT IN THE FUTURE AS AN APPLICATION HAS ALREADY BEEN MADE WITH THE RBI FOR APPROVAL TO CLOSE THIS OFFICE. THE APPLICABILITY OF SEC. 37 OF THE INCOME-TAX ACT 196 1 IS RESTRICTED TO A BUSINESS IN EXISTENCE. THE EXPRESSI ON EXPENDITURE LAID OUT OR EXPENDED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF ASSESSEES BUSINESS INDICATES THAT THE EXPENDITURE MUST RELATE TO BUSINESS IN EXISTENCE. IF DURING THE RELEVANT PERIO D THERE WAS IN FACT NO BUSINESS NO QUESTION OF COMPUTATION OF ITS INCOME AFTER DEDUCTION OF EXPENSES CAN POSSIBLY ARISE. THUS IT IS HELD THAT IN ORDER TO AVAIL DEDUCTION OF EXPENDITURE IT IS NECESSARY THAT THE BUSINESS IN RESPONSE TO WHICH THE EXPENSES HAVE BEEN INCURRED SHOULD BE CARRIED ON BY THE ASSESSEE DURING THE PREVIOUS YEAR. HENCE THE CONTENTION OF THE ASSESSEE IS REJECTED AND THIS AMOUNT OF RS.53 132/- A BREAK UP OF WHICH IS GIVEN BELOW IS ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. BANK CHARGES RS. 1 602/- MEMBERSHIP & SUBSCRIPTION RS. 5 000/- LEGAL & PROFESSIONAL CHARGES RS.15 000/- AUDIT FEES RS.16 530/- PROFESSIONAL FEES RS.15 000/- ------------------- RS.53 132/- 4 OUT OF THE SAME AN AMOUNT OF RS.16 530/- ON ACCOUNT OF AUDIT FEES HAS ALREADY BEEN ADDED BACK BY THE ASSESSEE U/S. 40(A)(IA) FOR WANT OF TDS AND HENCE A FURTHER QUANTUM ADDITION OF RS.36 602/- TO THE TOTAL INCOME OF THE ASSESSEE. 4. CLAIM OF DEPRECIATION . 4.1. THE ASSESSEE HAS DEBITED AN AMOUNT OF RS.20 46 838/- ON ACCOUNT OF DEPRECIATION IN TO THE PROFIT AND LOSS ACCOUNT AND HAS IN THE COMPUTATION OF INCOME CLAIMED DEPRECIATION TO THE TUNE OF RS.33 48 549/- COMPUTED AS PER THE PROVISIONS OF THE INCOME-TAX ACT. VIDE NOTICE U/S. 142 (1) DATED 31-10-2007 THE ASSESSEE WAS ASKED TO EXPLAIN AS TO WHY THIS EXPENSE WAS ALLOWABLE IN VIEW OF THE FACT THAT NO BUSINESS HAS BEEN CARRIED OUT DURING THE YEAR. VIDE WRITTEN SUBMISSION THE ASSESSEE STATED THAT THE PREMISE IS BEING MAINTAINED FOR BUSINESS PURPOSES WHICH INTER ALIA INCLUDES STATUTORY COMPLIANCES MAINTENANCE OF ACCOUNTS ETC. MERELY BECAUSE THERE IS NO SALES DURING THE YEAR IT CANNOT BE SAID THAT PREMISES AR E NOT USED FOR BUSINESS OR THAT VARIOUS EXPENSES HAVE NOT BEEN INCURRED FOR BUSINESS PURPOSES. THE ASSESSEE THEREFORE SUBMITTED THAT DEPRECIATION REPRESENTED BONAFIDE BUSINESS EXPENDITURE AND OUGHT TO BE ALLOWED. 4.2. THE CONTENTION OF THE ASSESSEE HAS BEEN DULY CONSIDERED BUT THE SAME IS FOUND TO BE NOT ACCEPTABLE. SECTION 32 OF THE INCOME TAX ACT LAYS DOWN THAT DEPRECIATION IS TO BE PROVIDED ONLY A) IF 5 THE ASSET IS OWNED BY THE ASSESSEE AND B) THE ASSET IS USED FOR THE PURPOSE OF BUSINESS OR PROFESSION. IN THE INSTANT CASE THE ASSESSEE DOES NOT SATISFY THE SECOND CLAUSE IN THAT THE ASSET HAS NOT BEEN USED A T ALL. HENCE THE CLAIM OF DEPRECIATION IS DISALLOWED. 3. AGGRIEVED ASSESSEE CONTENDED BEFORE THE CIT(A) THAT THERE WAS A TEMPORARY LULL IN THE BUSINESS AND UNTIL THE BUSINESS IS COMPLETELY CLOSED THE COMPANY HAS TO MAINTAIN ITS C ORPORATE STATUS IN WHICH EVENT IT HAS TO INCUR CERTAIN MINIMUM EXPENDI TURE SUCH AS AUDIT FEES ETC. AND HENCE THE SAME HAS TO BE ALLO WED AS DEDUCTION BY TREATING IT AS EXPENDITURE INCURRED WHOLLY LEGITIM ATELY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS. IT WAS FURTHER CONTEND ED THAT SINCE THERE WAS A TEMPORARY LULL IN THE BUSINESS IT CANNOT BE S AID THAT THE BUSINESS IS CLOSED IN WHICH EVENT ASSESSEE WOULD BE ENTITLED TO CLAIM DEPRECIATION UNDER SECTION 32 (1) OF THE ACT ON THE BUSINESS PREMISES. IN THE ALTERNATIVE VIDE GROUND NO.5 IT WAS CONTEND ED THAT THE ASSESSING OFFICER ERRED IN NOT ALLOWING SET OFF OF BROUGHT FORWARD BUSINESS LOSS AND UNABSORBED DEPRECIATION OF EARLIE R YEARS. 4. UNDISPUTEDLY ASSESSING OFFICER HAS NOT TAKEN IN TO CONSIDERATION GROUND NO.5 URGED BEFORE HIM. AS REGA RDS THE LEGAL AND PROFESSIONAL FEES AND AUDIT FEES LEARNED CIT(A) OB SERVED THAT THE ASSESSEE IS IN THE PROCESS OF CLOSING THE BUSINESS IN INDIA AND NECESSARY PERMISSION WAS TO BE OBTAINED IN THAT REG ARD AND UNTIL SUCH TIME ASSESSEE-COMPANY HAS TO ADHERE TO CERTAIN STAT UTORY REQUIREMENTS AND FOR THAT PURPOSE IT HAD TO INCUR C ERTAIN EXPENDITURE. UNDER THE CIRCUMSTANCES THE AFOREMENTIONED CLAIM W AS ALLOWED AS DEDUCTION. 5. WITH REGARD TO CLAIM OF DEDUCTION TOWARDS DEPRE CIATION LEARNED CIT(A) HAS TAKEN INTO CONSIDERATION AN ADDI TIONAL FACTOR TO UPHOLD THE ORDER OF THE ASSESSING OFFICER AND IN TH IS REGARD HE OBSERVED AS UNDER : 6 3. I HAVE GONE THROUGH THE FACTS OF THE CASE. LET ME TAKE THE DISALLOWANCE OF DEPRECIATION FIRST. I HAVE GONE THROUGH THE PROFIT AND LOSS A/C. OF THE APPELLANT. I COULD NOT FIND ANY EXPENSES SUCH AS ELECTRICITY CHARGES REPAIR CHARGES WATER CHARGES AND SECURITY CHARGES ETC. WITH REGARD TO THE BUILDING. THIS CLEARLY SHOWS THAT THE BUILDING WAS NOT AT ALL USED. THIS IS THE POSITION IN THE EARLIE R YEAR ALSO. IN VIEW OF THIS I HOLD THAT THE BUILDIN G IS NOT AT ALL USED FOR APPELLANTS BUSINESS PURPOSES. IN VIEW OF THIS I UPHOLD THE ASSESSING OFFICERS ACTION IN DISALLOWING THE CLAIM OF DEPRECIATION EXPENSES. 6. AGGRIEVED ASSESSEE IS IN APPEAL BEFORE US. LEA RNED COUNSEL APPEARING ON BEHALF OF THE ASSESSEE SUBMI TTED THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN DISALLOWING THE CLAIM OF DEPRECIATION OF RS.33 48 549/-. ADVERTING OUR ATTE NTION TO THE ORDER OF THE ASSESSING OFFICER LEARNED COUNSEL APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER ARRI VED AT THE CONCLUSION THAT ASSESSEE HAD CLOSED ITS BUSINESS BY RELYING UPON THE LETTER ADDRESSED BY THE ASSESSEE TO THE RBI OVERLO OKING THE FACT THAT IN THE LETTER ADDRESSED TO RBI IT HAD ONLY SOUGHT P ERMISSION TO REPATRIATE THE SALE PROCEEDS FROM THE SALE OF THE IMMOVABLE PROPERTY. THIS LETTER WAS DATED 14 TH MARCH 2008 AND PRIOR TO THAT IT HAD MADE AN APPLICATION IN PROFORMA-II WHEREIN IT WAS STATE D THAT THE REASON FOR TRANSFER OR DISPOSING OF THE PROPERTY WAS ON ACCOUN T OF CLOSURE OF INDIAN BRANCH OF THE O/O.PENFORD (ISRAEL) LIMITED. ON 11 TH MAY 2007 A LETTER WAS ANNEXED TO PROFORMA-II WHEREIN IT WAS STATED THAT THE ASSESSEE IS IN THE PROCESS OF CLOSING ITS BRANCH AN D THEREFORE IT WISHES TO TRANSFER THE OFFICE PREMISES. IT WAS SUBMITTED T HAT AT BEST THE BUSINESS CAN BE SAID TO HAVE BEEN CLOSED ON 17 TH MARCH 2007 BUT WE ARE CONCERNED WITH THE ASSESSMENT YEAR 2005-2006 WH EREIN ASSESSEE 7 HAD NOT DECLARED ITS INTENTION TO CLOSE THE BUSINES S. THE FACT THAT IT WAS PAYING THE PROFESSIONAL FEES AND RUNNING ITS BR ANCH OFFICE INDICATES THAT THE ASSESSEE INTENDED TO CONTINUE IN BUSINESS AND IT CAN AT BEST BE CONSIDERED AS A MERE LULL IN THE BUS INESS ACTIVITY. EVEN THOUGH THERE WAS NO TRADING ACTIVITY IN THE ASSESSM ENT YEAR 2004- 2005 THE ASSESSING OFFICER CHOSE TO PROCESS THE RET URN WHEREIN CLAIM OF DEPRECIATION WAS ACCEPTED WHICH IMPLIES THAT THE ASSESSING OFFICER ADMITTED THAT THE COMPANY INTENDED TO CONTINUE ITS INDIAN BRANCH. LEARNED COUNSEL APPEARING ON BEHALF OF THE ASSESSE E FURTHER SUBMITTED THAT THE ASSESSEE OFFERED TO TAX EXCHANGE FLUCTUATION GAIN OF RS.11 25 000/- AND THE SAME HAVING BEEN ACCEPTED BY THE ASSESSING OFFICER HE CANNOT DISALLOW THE CLAIM OF DEPRECIATIO N. IN OTHERWORDS ASSESSING OFFICER CANNOT BLOW HOT AND COLD BY CLAIM ING ON ONE HAND THAT THERE IS NO BUSINESS ACTIVITY SO AS NOT TO PER MIT THE ASSESSEE TO CLAIM DEPRECIATION WHEREAS ON THE OTHER HAND ACCEPT ING THE EXCHANGE FLUCTUATION GAIN AS BUSINESS INCOME. THOUGH NO SPEC IFIC GROUND WAS URGED IN THIS REGARD LEARNED COUNSEL SUBMITTED THA T IT IS A PURE LEGAL ISSUE FOR WHICH NO FRESH FACTS ARE REQUIRED AND THE SAME IS IN CONNECTION WITH THE CLAIM OF DEPRECIATION AND THERE FORE HE REQUESTED FOR ADMISSION OF THIS GROUND UNDER RULE 27 OF THE I NCOME TAX APPELLATE TRIBUNAL RULES. 7. HE FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS NOT GIVEN ANY FACTUAL FINDING THAT THE BUSINESS WAS ACT UALLY CLOSED FOR THE YEAR UNDER CONSIDERATION BUT MERELY BASED UPON THE LETTER ADDRESSED TO RBI IN 2007; A LETTER ADDRESSED SUBSEQUENT TO TH E ASSESSMENT YEAR UNDER CONSIDERATION CANNOT BE TAKEN AS THE BASIS TO HOLD THAT IN THE PRECEDING YEAR ALSO THERE WAS NO INTENTION TO CARRY ON THE BUSINESS. SIMILARLY THE LEARNED CIT(A) WAS NOT JUSTIFIED IN HOLDING THAT IN THE ABSENCE OF ANY EXPENDITURE TOWARDS ELECTRICITY CHAR GES ETC. WITH REGARD TO THE BUILDING IT CAN BE CONCLUDED THAT THE ASSESSEE DID NOT INTEND TO CARRY ON BUSINESS; THE FACT THAT THE ASSE SSEE CONTINUES TO PAY PROFESSIONAL TAX ETC. INDICATE THAT IT INTENDE D TO CARRY ON 8 BUSINESS. SUBSEQUENT EVENTS SHOULD NOT BE TAKEN INT O CONSIDERATION TO HOLD THAT EVEN IN THE EARLIER YEARS THE ASSESSEE NEVER INTENDED TO CARRY ON BUSINESS. HE ALSO STRESSED UPON THE FACT T HAT THE ASSESSING OFFICER HAVING ASSESSED TO TAX A SUM OF RS.11 25 00 0/- UNDER THE HEAD INCOME FROM BUSINESS REFERABLE TO EXCHANG E FLUCTUATION GAIN HE CANNOT NOW CONTEND THAT THE ASSESSEE IS NOT CARR YING ON BUSINESS ACTIVITY. HE ALSO SUBMITTED THAT WHEN THERE IS A BU SINESS ACTIVITY DEPRECIATION CLAIMED BY THE ASSESSEE OUGHT TO HAVE BEEN ALLOWED PARTICULARLY WHEN IT IS PART OF THE BLOCK OF THE AS SETS. IT WAS CONTENDED THAT IN THE CASE OF BLOCK OF ASSETS (IN THE INSTAN T CASE ONLY OFFICE PREMISES IS PART OF THE BLOCK OF ASSETS) ONLY IN TH E FIRST YEAR QUESTION OF ELIGIBILITY TO CLAIM DEPRECIATION CAN BE CONSIDE RED AND ONCE DEPRECIATION IS ALLOWED IN THE FIRST YEAR THE ASSES SING OFFICER HAS TO AUTOMATICALLY ALLOW DEPRECIATION IN THE SUBSEQUENT YEARS SO LONG AS IT FORMS PART OF THE BLOCK OF ASSETS. HE ALSO SUBMITTE D THAT IF THE TAX AUTHORITIES ARE OF THE OPINION THAT THERE IS NO BUS INESS ACTIVITY GAIN ON ACCOUNT OF FOREIGN EXCHANGE FLUCTUATION WHICH IS OTHERWISE ASSESSABLE TO TAX UNDER SECTION 28 OF THE ACT CANNO T BE ASSESSED EVEN UNDER THE HEAD OTHER SOURCES IN THE LIGHT OF DECI SION OF THE APEX COURT IN THE CASE OF NALINIKANTH AMBALAL 61 ITR 42 8. HE THUS SUBMITTED THAT THE MAIN CONTENTION OF THE ASSESSEE WITH REGARD TO THE CLAIM OF DEDUCTION TOWARDS DEPRECIATION WAS NOT PRO PERLY CONSIDERED AND THE ALTERNATIVE CONTENTION WITH REGARD TO SET O FF OF BROUGHT FORWARD LOSSES AND THE FURTHER CONTENTION URGED AT THIS STAGE WERE ALSO NOT CONSIDERED BY THE TAX AUTHORITIES. 8. WE HAVE HEARD THE LEARNED DR ALSO IN THIS REGARD AND CAREFULLY PERUSED THE RECORD. BOTH THE PARTIES ADMITTED THAT THE ASSESSING OFFICER AS WELL AS CIT(A) HAVE CONSIDERED THE ISSUE OF ELIGIBILITY TO CLAIM DEPRECIATION FROM A LIMITED ANGLE. SINCE THE LEARNED COUNSEL APPEARING ON BEHALF OF THE ASSESSEE HAS RAISED VAR IOUS ISSUES WITH REGARD TO CLAIM OF DEPRECIATION AND ALSO THE ALTERN ATIVE CONTENTION AS TO THE CLAIM OF SET OFF OF THE BROUGHT FORWARD BUSI NESS LOSSES OR THE 9 NON-TAXABILITY OF THE INCOME ACCRUED IN THE FORM OF EXCHANGE FLUCTUATION WE DEEM IT FAIR AND REASONABLE IN THE INTEREST OF SUBSTANTIAL JUSTICE TO SET ASIDE THE ISSUE TO THE F ILE OF THE ASSESSING OFFICER WITH A DIRECTION TO HIM TO RECONSIDER THE M ATTER IN ACCORDANCE WITH THE LAW. THE ASSESSING OFFICER SHALL GIVE A RE ASONABLE OPPORTUNITY OF BEING HEARD AND CONSIDER THE CLAIM MADE BY THE A SSESSEE WITH REGARD TO CLAIM OF DEPRECIATION AND THE ADDITIONAL/ ALTERNATIVE ARGUMENTS ADVANCED IN CONNECTION WITH THE CLAIM OF DEPRECIATION. 9. IN THE RESULT APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES AS PRONOUNCED IN THE OPEN COURT. SD/- (RAJENDRA SINGH) ACCOUNTANT MEMBER SD/- (D. MANMOHAN) VICE PRESIDENT DATED : 30 TH MARCH 2011 VBP/- COPY TO 1. PENFORD (ISRAEL) LIMITED 1102 PRASAD CHAMBERS OPERA HOUSE MUMBAI. AABCP7258D 2. THE DY.DIT I.T. 4 (2) SCINDIA HOUSE 1 ST FLOOR N.M. ROAD BALLARD ESTATE MUMBAI 400 038. 3. COMMISSIONER OF INCOME TAX (APPEALS)-XXXIII MUM BAI 4. D.I.T. (I.T) MUMBAI 5. DR L BENCH 6. GUARD FILE. BY ORDER TRUE COPY ASSTT. REGISTRAR ITAT MUMBAI