L & T FINANCE LTD, v. DCIT CIR 2(2),

MA 420/MUM/2013 | 1995-1996
Pronouncement Date: 30-04-2014 | Result: Allowed

Appeal Details

RSA Number 42019924 RSA 2013
Assessee PAN AAACL0140P
Bench Mumbai
Appeal Number MA 420/MUM/2013
Duration Of Justice 5 month(s) 7 day(s)
Appellant L & T FINANCE LTD,
Respondent DCIT CIR 2(2),
Appeal Type Miscellaneous Application
Pronouncement Date 30-04-2014
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 30-04-2014
Assessment Year 1995-1996
Appeal Filed On 22-11-2013
Judgment Text
A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH MUMBAI .. ; BEFORE SHRI P.M. JAGTAP AM AND SHRI VIVEK VARMA J M 420 TO 422/ MUM/2013 ARISING OUT OF ITA NO. 2574 TO 2576/MUM/2010 ( / ASSESSMENT YEARS: 1995-96 1996-97 & 1997-08) L&T FINANCE LIMITED TAXATION DEPARTMENT L&T HOUSE N.M. MARG BALLARD ESTATE MUMBAI -400 001. / VS. DY. CIT CIRCLE 2(2) AAYAKAR BHAVAN M.K. ROAD MUMBAI 20. . / PAN : AAACL 0140P ( ) / APPELLANT ) .. ( *+) / RESPONDENT ) ) / APPLICANT BY : SHRI HEENA DOSHI *+) / RESPONDENT BY : SHRI GANES H BARE 1 / DATE OF HEARING : 25-4-2014 1 / DATE OF PRONOUNCEMENT :30-04-2014 / O R D E R PER P.M. JAGTAP A.M . : BY THESE MISC. APPLICATIONS THE ASSESSEE IS SEEKIN G RECTIFICATION OF THE COMMON ORDER OF THE TRIBUNAL DATED 9-5-2012 PASSED IN ITA NO. 2574 2575 AND 2576/MUM/2010 FOR ASSESSMENT YEARS 1995-96 1996-97 & 1997-98 ON THE GROUND THAT THE VIEW TAKEN THEREIN WHILE CONFIRMING THE DISALLOWANCE MADE ON A CCOUNT OF ASSESSEES CLAIM FOR DEPRECIATION IN RESPECT OF CERTAIN ASSETS PURCHASED FROM CERTAIN PARTIES AND GIVEN BACK ON LEASE TO THEM IS NOT IN CONFORMITY WITH THE DECI SION OF HONBLE SUPREME COURT IN THE CASE OF I.C.D.S LTD. VS.CIT & ANOTHER (2013) 35 0 ITR 527 (SC) RENDERED SUBSEQUENTLY . 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL PLACED ON RECORD. IT IS OBSERVED THAT WHIL E DISPOSING OF THE AFORESAID APPEALS OF THE ASSESSEE VIDE A COMMON ORDER DATED 9-5-2012 TH E DISALLOWANCE MADE BY THE A.O. MA 420 TO 4 22/MUM/2013 2 AND CONFIRMED BY THE LD. CIT(A) ON ACCOUNT OF ASSES SEES CLAIM FOR DEPRECIATION ON THE ASSETS PURCHASED AND GIVEN BACK ON LEASE WAS SU STAINED BY THE TRIBUNAL RELYING ON THE DECISION OF SPECIAL BENCH OF THE TRIBUNAL IN TH E CASE OF M/S INDUSIND BANK LTD. VS. ADDL. CIT PASSED BY THE TRIBUNAL ON 14-3-2012 WHERE IN IT WAS HELD THAT DEPRECIATION IN THE CASE OF FINANCE LEASE IS NOT ADMISSIBLE TO THE LESSOR WHO IS SIMPLY A NOMINAL AND SYMBOLIC OWNER OF THE ASSET WHEREAS THE REAL OWNER WHO BEARS ALL THE RISKS AND REWARDS INCIDENTAL TO THE OWNERSHIP IS THE LESSEE. IN THE JUDGMENT DELIVERED SUBSEQUENTLY IN THE CASE OF I.C.D.S. LTD. (SUPRA) THE HONBLE SUPREME COURT HAS HELD THAT EVEN IN THE CASE OF FINANCE LEASE THE LESSOR IS ELIGIBLE TO CLAIM D EPRECIATION. AS POINTED OUT BY THE LD. COUNSEL FOR THE ASSESSEE THE SAID DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF I.C.D.S. LTD. (SUPRA) HAS BEEN FOLLOWED BY THE COOR DINATE BENCH OF THIS TRIBUNAL IN THE CASE OF M/S L&T LTD. IN ITS ORDER DATED 1-5-2013 PA SSED IN ITA NO. 2200/MUM/02 AND OTHERS FOR ASSESSMENT YEARS 1995-96 AND 1996-97 TO ALLOW A SIMILAR CLAIM OF THE ASSESSEE FOR DEPRECIATION IN THE CASE OF SALE AND L EASE BACK TRANSACTIONS. THE DECISION RENDERED BY THE TRIBUNAL VIDE ITS ORDER DATED 9-5-2 012 (SUPRA) THUS IS CONTRARY TO THE VIEW EXPRESSED BY THE HONBLE SUPREME COURT IN THE CASE OF I.C.D.S. LTD. (SUPRA) RENDERED SUBSEQUENTLY AND THIS POSITION HAS NOT BEE N DISPUTED EVEN BY THE LD. D.R. AT THE TIME OF HEARING BEFORE US. IN THE CASE OF ACIT VS. SAURASHTRA KUTCH STOCK EXCHANGE LTD. (2008) 305 ITR 227 (SC) THE HONBLE SUPREME COURT HAS HELD THAT EVEN THE JUDGMENT OF THE JURISDICTIONAL HIGH COURT ALTH OUGH RENDERED SUBSEQUENTLY WOULD GIVE RISE TO A MISTAKE APPARENT FROM RECORD IN THE ORDER OF THE TRIBUNAL WHICH IS NOT IN CONFORMITY WITH THE SAID DECISION. KEEPING IN VIEW THE SAID DECISION OF THE HONBLE APEX COURT WHICH IS SQUARELY APPLICABLE IN THE PRE SENT CONTEXT WE RECTIFY THE ORDER OF THE TRIBUNAL DATED 9-5-2012 (SUPRA) AND DIRECT THE A.O. TO ALLOW THE CLAIM OF THE ASSESSEE FOR DEPRECIATION ON THE ASSETS GIVEN UNDER SALE AND LEASE BACK BASIS. THE A.O. IS ALSO DIRECTED TO WITHDRAW ANY CORRESPONDING BENE FIT GIVEN TO THE ASSESSEE BY EXCLUDING THE VALUE OF CAPITAL COMPONENT OF THE LEA SE RENT FROM THE INCOME OF THE ASSESSEE. MA 420 TO 4 22/MUM/2013 3 5. IN THE RESULT THE MISC. APPLICATIONS FI LED BY THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30-04-2014 . 7 8 30-04-2014 SD/- SD/- (VIVEK VARMA) ( P.M. JAGTAP ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; 8 DATED 30-04-2014 .../ RK SR. PS ' #%& '& / COPY OF THE ORDER FORWARDED TO : 1. ) / THE APPELLANT 2. *+) / THE RESPONDENT. 3. A () / THE CIT(A)- CONCERNED MUMBAOI 4. A / CIT CONCERNED MUMBAI 5. *E 1 E / DR ITAT MUMBAI A BENCH 6. / GUARD FILE. / BY ORDER + * //TRUE COPY// / ( DY./ASSTT. REGISTRAR) / ITAT MUMBAI