ACIT CEN CIR 22, MUMBAI v. DEVELOPMENT CREDIT BANK LTD, MUMBAI

ITA 4843/MUM/2010 | 2006-2007
Pronouncement Date: 26-07-2013 | Result: Dismissed

Appeal Details

RSA Number 484319914 RSA 2010
Assessee PAN AAACD1461F
Bench Mumbai
Appeal Number ITA 4843/MUM/2010
Duration Of Justice 3 year(s) 1 month(s) 15 day(s)
Appellant ACIT CEN CIR 22, MUMBAI
Respondent DEVELOPMENT CREDIT BANK LTD, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 26-07-2013
Appeal Filed By Department
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 26-07-2013
Date Of Final Hearing 24-07-2013
Next Hearing Date 24-07-2013
Assessment Year 2006-2007
Appeal Filed On 11-06-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D MUMBAI .. ! ' #. . $.. % & ' ' BEFORE SHRI R.S.SYAL AM AND DR.S.T.M.PAVALAN JM ITA NO.5127/MUM/2010 : ASST.YEAR 2005-2006 ITA NO.5128/MUM/2010 : ASST.YEAR 2006-2007 ITA NO.725/MUM/2011 : ASST.YEAR 2007-2008 M/S.DEVELOPMENT CREDIT BANK LIMITED 301 DELTA PLAZA 3 RD FLOOR VEER SAVARKAR MARG PRABHADEVI MUMBAI 400 025. PAN : AAACD1461F. THE DY.COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE 22 MUMBAI. ( () / // / APPELLANT) % % % % / VS. ( + ()/ RESPONDENT) ITA NO.4816/MUM/2010 : ASST.YEAR 2005-2006 ITA NO.4843/MUM/2010 : ASST.YEAR 2006-2007 ITA NO.8215/MUM/2010 : ASST.YEAR 2007-2008 THE DY.COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE 22 MUMBAI. M/S.DEVELOPMENT CREDIT BANK LIMITED 301 DELTA PLAZA 3 RD FLOOR VEER SAVARKAR MARG PRABHADEVI MUMBAI 400 025. ( () / // / APPELLANT) % % % % / VS. ( + ()/ RESPONDENT) - - - - . .. . / / / / / REVENUE BY : SHRI S.D.SRIVASTAVA (CIT-DR) &% 01 &% 01 &% 01 &% 01 . / . / . / . / / ASSESSEE BY : SHRI SATISH R.MODY % . 1! / / / / DATE OF HEARING : 24.07.2013 234 . 1! / DATE OF PRONOUNCEMENT : 26.07.2013 ' 5 ' 5 ' 5 ' 5 / / / / O R D E R PER R.S.SYAL (AM) : THIS BATCH OF SIX CROSS APPEALS RELATES TO ASSESSME NT YEARS 2005- 2006 TO 2007-2008. SINCE SOME OF THE ISSUES RAISED IN THESE APPEALS ARE COMMON WE ARE THEREFORE PROCEEDING TO DISPOS E THEM OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE . ITA NO.5127/MUM/2010 & ORS. M/S.DEVELOPMENT CREDIT BANK LTD. 2 ASSESSMENT YEAR 2005-2006 2. FIRST GROUND OF THE ASSESSEES APPEAL IS AGAINST NOT GRANTING OF DEPRECIATION AMOUNTING TO ` 67 94 816 ON LEASED ASSETS. GROUND NO.1.B. OF THE REVENUES APPEAL IS AGAINST ALLOWING DEPRECIATION IN RESPECT OF ASSETS LEASED TO VARIOUS PARTIES IGNORIN G THE FACT THAT IT WAS A PURE FINANCE LEASE. 3. AT THE VERY OUTSET THE LEARNED COUNSEL FOR THE ASSESSEE CONTENDED THAT SIMILAR ISSUE CAME UP FOR CONSIDERAT ION BY THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR S 1996-97 ONWARDS IN ITA NO.3096/MUM/2001 ETC. PLACING ON REC ORD A COPY OF THE ORDER DATED 20.03.2013 PASSED FOR SUCH YEARS T HE LEARNED AR SUBMITTED THAT THE TRIBUNAL WAS PLEASED TO GRANT DE PRECIATION ON LEASED ASSETS WHILE SIMULTANEOUSLY REJECTING THE RE VENUES GROUND IN RESPECT OF DEPRECIATION ON THE ASSETS ON FINANCE LE ASE. THE LEARNED DEPARTMENTAL REPRESENTATIVE WAS FAIR ENOUGH TO CONC EDE THAT THE FACTS AND CIRCUMSTANCES OF THE PRESENT GROUNDS ARE SIMILAR TO THOSE ALREADY DECIDED BY THE TRIBUNAL IN ASSESSEES FAVOU R THROUGH THE AFORESAID ORDER. RESPECTFULLY FOLLOWING THE PRECEDE NT WE ALLOW GROUND 1.A. OF THE ASSESSEES APPEAL WHILE DISMISSI NG GROUND 1.B. OF THE REVENUES APPEAL. 4. GROUND 1.B. OF THE ASSESSEES APPEAL IS ABOUT TH E DENIAL OF DEPRECIATION AMOUNTING TO ` 1 67 882 ON PREMISES. THE LEARNED AR SUBMITTED THAT SIMILAR ISSUE WAS RAISED IN THE AFOR E-NOTED ORDER ALSO AND THE TRIBUNAL VIDE PARA 63 HAS REMITTED THE MATT ER TO THE FILE OF ITA NO.5127/MUM/2010 & ORS. M/S.DEVELOPMENT CREDIT BANK LTD. 3 A.O. WITH CERTAIN DIRECTIONS. THE LEARNED DEPARTMEN TAL REPRESENTATIVE ACCEPTED THE POSITION STATED ON BEHA LF OF THE ASSESSEE. IN THE ABSENCE OF ANY DISTINCTION IN THE FACTS FOR THE CURRENT YEAR VIS- -VIS THE ASSESSMENT YEARS ALREADY DECIDED BY THE TRIBUNA L WE SET ASIDE THE IMPUGNED ORDER ON THIS ISSUE AND REMIT TH E MATTER TO THE FILE OF A.O. FOR DECIDING IT IN CONFORMITY WITH THE DIRE CTIONS OF THE TRIBUNAL CONTAINED IN PARA 63 OF THE AFORE-STATED O RDER. 5. GROUND NO.2 OF THE ASSESSEES APPEAL IS ABOUT TH E CONFIRMATION OF ADDITION U/S 14A. THE LEARNED AR STATED THAT THE TRIBUNAL CONFIRMED THE ADDITION AT THE RATE OF 10% OF EXEMPT INCOME IN ITS ABOVE REFERRED ORDER . SINCE THE FACTS AND CIRCUMST ANCES OF THE INSTANT YEAR ARE ADMITTEDLY SIMILAR TO THOSE FOR THE EARLIE R YEARS DECIDED BY THE TRIBUNAL WE SET ASIDE THE IMPUGNED ORDER AND D IRECT THE 10% OF THE EXEMPT INCOME SHOULD BE DISALLOWED U/S 14A. 6. GROUND NO.1.A. OF THE REVENUES APPEAL IS AGAINS T REMITTING THE MATTER TO THE FILE OF A.O. IN RESPECT OF DEDUCTION FOR BAD DEBTS. THE ASSESSING OFFICER DID NOT ALLOW DEDUCTION ON ACCOUN T OF BAD DEBTS. THE LEARNED CIT(A) RELYING ON THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF OMAN INTERNATIONAL BANK S.A.O.G [313 ITR 128 (BOM.)] REMITTED THE MATTER TO THE FILE OF A.O. FOR DECIDING THIS ISSUE AFRESH AFTER VERIFYING AS T O WHETHER THE REQUISITE CONDITIONS WERE SATISFIED OR NOT AND FURT HER SEEING WHETHER THE INVESTMENTS WERE MADE IN THE ORDINARY COURSE OF BUSINESS. THE LEARNED COUNSEL FOR THE ASSESSEE CONTENDED THAT THE TRIBUNAL DECIDED THIS ISSUE IN ASSESSEES FAVOUR IN ITS ORDER. WE FIN D FROM PARA 192 OF ITA NO.5127/MUM/2010 & ORS. M/S.DEVELOPMENT CREDIT BANK LTD. 4 THE AFORE-SAID TRIBUNAL ORDER THAT THE DEDUCTION WA S HELD TO BE AVAILABLE BECAUSE THE CIT(A) FOUND THAT THE ASSESSE E HAD DEBITED THE AMOUNT WHICH WERE IRRECOVERABLE. IT IS NOTICED THAT THE LEARNED CIT(A) HAS RESTORED THE MATTER TO THE FILE OF A.O. IN ABOVE TERMS. WE THEREFORE DO NOT FIND ANY INFIRMITY IN THE DIRECTI ON GIVEN BY THE LEARNED CIT(A) FOR CONSIDERING THE DEDUCTIBILITY OR OTHERWISE ON THE BASIS OF THE JUDGMENT GIVEN BY THE HONBLE JURISDIC TIONAL HIGH COURT IN THE CASE OF OMAN INTERNATIONAL BANK S.A.O.G. MOR EOVER IT IS THE REVENUE WHICH IS AGGRIEVED AGAINST THE DIRECTION OF RESTORATION. THE ASSESSEE HAS NOT FILED APPEAL ON THIS ISSUE CONTEND ING THAT THE ADDITION BE DELETED INSTEAD OF RESTORATION. WE THEREFORE D O NOT PROPOSE TO INTERFERE WITH THE IMPUGNED ORDER ON THIS SCORE. TH IS GROUND IS NOT ALLOWED. 7. 0 16 - . 7 !0- . -1 89 &% 01 . 7 :5 1 ; . -1 89 IN THE RESULT REVENUES APPEAL IS DISMISSED AND TH AT OF THE ASSESSEE IS PARTLY ALLOWED. ASSESSMENT YEAR 2006-2007 8. THE ONLY GROUND RAISED BY THE ASSESSEE IN ITS AP PEAL IS AGAINST THE DENIAL OF DEPRECIATION ON LEASED ASSETS AND DEN IAL OF DEPRECIATION ON PREMISES. THE ONLY EFFECTIVE GROUND IN THE REVEN UES APPEAL IS AGAINST ALLOWING DEPRECIATION IN RESPECT OF ASSETS GIVEN ON FINANCE LEASE. BOTH THE SIDES ARE IN AGREEMENT THAT THE FAC TS AND CIRCUMSTANCES OF THESE GROUNDS ARE SIMILAR TO THOSE FOR ASSESSMENT YEAR 2005-2006. FOLLOWING THE VIEW TAKEN HEREINABOV E WE ALLOW ITA NO.5127/MUM/2010 & ORS. M/S.DEVELOPMENT CREDIT BANK LTD. 5 GROUND NO.1.A. OF THE ASSESSEES APPEAL; RESTORE GR OUND NO.1.B. OF THE ASSESSEES APPEAL TO THE FILE OF A.O. FOR A FRESH D ECISION IN CONFORMITY WITH THE EARLIER DIRECTION GIVEN BY THE TRIBUNAL; A ND DISMISS REVENUES GROUND. 9. 0 16 - . 7 !0- . -1 89 &% 01 . 7 :5 1 ; . -1 89 IN THE RESULT THE REVENUES APPEAL IS DISMISSED AN D THAT OF THE ASSESSEE IS PARTLY ALLOWED. ASSESSMENT YEAR 2007-2008 10. GROUND NO.1 OF THE ASSESSEES APPEAL IS GENERA L WHICH DOES NOT REQUIRE ANY ADJUDICATION. 11. GROUND 2.A. IS AGAINST THE DENIAL OF DEPRECIAT ION OF LEASED ASSETS AMOUNTING TO ` 55.21 LAKH. FOLLOWING THE VIEW TAKEN HEREINABOVE TH IS GROUND IS ALLOWED. 12. GROUND 2.B. IS AGAINST THE DEPRECIATION ON PREM ISES. FOLLOWING THE VIEW TAKEN IN THE EARLIER YEAR WE SET ASIDE TH E IMPUGNED ORDER ON THIS ISSUE AND RESTORE THE MATTER TO THE FILE OF A. O. FOR A FRESH DECISION IN CONSONANCE WITH THE DIRECTIONS GIVEN BY THE TRIB UNAL IN EARLIER YEARS. 13. GROUND 2.C. ABOUT CONFIRMATION OF ADDITION OF ` 19.81 LAKH ON ACCOUNT OF EXPENSES OF CAPITAL NATURE WAS NOT PRESS ED BY THE LEARNED AR. THE SAME IS THEREFORE DISMISSED. ITA NO.5127/MUM/2010 & ORS. M/S.DEVELOPMENT CREDIT BANK LTD. 6 14. THE ONLY EFFECTIVE GROUND IN THE REVENUES APPE AL IS AGAINST ALLOWING DEPRECIATION IN RESPECT OF ASSETS GIVEN ON FINANCE LEASE. BOTH THE SIDES ARE IN AGREEMENT THAT THE FACTS AND CIRCUMSTANCES OF THESE GROUNDS ARE SIMILAR TO THOSE FOR ASSESSMENT Y EAR 2005-2006. FOLLOWING THE VIEW TAKEN HEREINABOVE WE DISMISS TH IS GROUND. 15. 0 16 - . 7 !0- . -1 89 &% 01 . 7 :5 1 ; . -1 89 IN THE RESULT THE REVENUES APPEAL IS DISMISSED AN D THAT OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 26 TH DAY OF JULY 2013. ' 5 . 234 <'%6 3 . = SD/- SD/- (DR.S.T.M.PAVALAN) (R.S.SYAL) & ' & ' & ' & ' / JUDICIAL MEMBER ! ' ! ' ! ' ! ' / ACCOUNTANT MEMBER MUMBAI ; <'% DATED : 26 TH JULY 2013. DEVDAS* ' 5 . +&1 ' 5 . +&1 ' 5 . +&1 ' 5 . +&1:> ? >41 :> ? >41 :> ? >41 :> ? >41/ COPY OF THE ORDER FORWARDED TO : 1. () / THE APPELLANT 2. + () / THE RESPONDENT. 3. @ () / THE CIT MUMBAI. 4. @ / CIT(A) - 39 MUMBAI 5. >C= +&1&% / DR ITAT MUMBAI 6. = D / GUARD FILE. ' 5% ' 5% ' 5% ' 5% / BY ORDER >1 +&1 //TRUE COPY// E E E E/ // /8 - 8 - 8 - 8 - ( DY./ASSTT. REGISTRAR) / ITAT MUMBAI