TaxTMI 
TaxTMI 
TaxTMI 
2014 (9) TMI 198
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....t, "while the cost of fixed asset at the time of acquisition was Rs. 567.62 Crores, it was not understandable as to how the said figure could go up to Rs. 575.05 Crores for the purposes of depreciation," While holding so, the Hon'ble ITAT has missed to note that the value of fixed asset at Rs. 567.62 Crores had been worked out as on 4.11.2004 with reference to the consideration amounting to Rs. 467.95 Crores paid by that time, whereas the enhancement in cost to Rs. 575.05 Crores by a sum of Rs. 7.43 Crores represented the value of shares amounting to Rs. 7,42,69,500/- as had been allotted in favour of the shareholders of JKSL on 10.3.2005. The fact not in dispute at any of the stages below. 8. Further, the controversy (at all stages below, which was raised by the Revenue in appeal also before the Hon'ble Tribunal) was as to whether assessee's claim for depreciation on a sum of Rs. 7,42,69,500/- representing the face value of shares allotted by JKCL to the shareholders of JKSL and accounted for as 'goodwill' was admissible or not. Most humbly it is stated that this controversy remains undecided/unadjud....
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....t in compliance of the stipulation of scheme approved by AAIFR in the matter of J.K. Synthetics Limited. He also submitted that on page No. 8 to 10 of Misc. Application No. 24/Lkw/2014 are reproduction of Para 3,7 & 8 of the assessment order and from the same, it can be seen that this issue was very much discussed by the Assessing Officer in the assessment order that the assessee company has issued shares to the shareholders of J.K. Synthetics Limited worth Rs. 7,42,69,500/- in respect of goodwill on which depreciation was claimed by the assessee and this aspect was not considered by the Tribunal in the impugned order and therefore, there is apparent mistake in the Tribunal order. Reliance was placed on the following judicial pronouncements: (i) Assistant Commissioner of Income-tax Vs Saurashtra Kutch Stock Exchange Ltd. [2008] 305 ITR 227 (ii) Commissioner of Income-tax Vs Mool Chand Shyam Lal [2005] 273 ITR 160 (All) (iii) Honda Siel Power Products Ltd. Vs Commissioner of Income-tax [2007] 295 ITR 466 (SC) ....
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....ciation available on page 58 of the paper book, depreciation is calculated on assets of Rs. 567,62,40,544.27 with amount of depreciation of Rs. 72,32,58,987. But on page 59 of the paper book in the revised depreciation chart, the assessee has taken the value of asset at Rs. 575,05,10,044.63 with amount of depreciation of Rs. 73,26,86,528.73. We fail to understand that when as per the balance sheet, the value of post acquisition assets is shown at Rs. 56762.41 lacs, how it can go up for depreciation purpose. Therefore, in our considered opinion, maximum depreciation allowable is on assets of Rs. 56762.41 lacs, which is already allowed by the A.O. also. Extra depreciation allowed by the learned CIT (A) is not sustainable in view of the facts of the present case as discussed above. Since our decision is on the basis of the facts of the present case and the A.O. has allowed the maximum depreciation allowable on the post acquisition assets as per balance sheet submitted before us. The judgments cited by both sides have no relevance in the facts of the present case. Hence, the order of learned CIT (A) is reversed on this issue and that of the A.O. is restored in both years." 6.1 From th....
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.... the paper book, the assessee has claimed depreciation of Rs. 73,26,86,528.73 on total assets of Rs. 575,05,10,044.63. On page No. 59 of the paper book also, there is no item appearing in the list of assets under the head goodwill. The assets on which depreciation has been claimed by the assessee as per page No. 59 of the paper book are building, plant & machinery and other assets being arms and ammunition etc. The assessee also included in the list of assets free hold land and lease hold land although no depreciation has been claimed on these two assets. This goes to show that the assessee itself has not claimed any depreciation on goodwill even as per revised depreciation chart available on page No. 59 of the paper book. 6.2 Regarding the schedule of fixed assets in the balance sheet, available on page No. 43 of the paper book, we find that this includes goodwill of Rs. 742.70 lac but since no depreciation has been claimed by the assessee even as per revised depreciation chart, the schedule of fixed assets as per audited balance sheet is not relevant for the purpose of computing depreciation to the assessee because depreciation has to be allowed as per income tax rules and the A....
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....ded the item goodwill in the depreciation chart, it is apparent that no evidence has been brought on record by the assessee for claiming depreciation on goodwill and therefore, no depreciation can be allowed on goodwill in the facts of the present case. Regarding Para 3,7 and 8 of the assessment order, reproduced by the assessee on page No. 8 to 10 of the Misc. Application, we find that in Para 7 of the assessment order, the Assessing Officer has reproduced the relevant portion of the assessee's reply dated 04/12/2007 submitted before the Assessing Office. Para 3 of its reply as appearing on page No. 9 of the Misc. Application, is reproduced below because it is relevant for deciding the present Misc. Applications: "3. The assessee company submits that the aforesaid Rs. 7.43 crores forms part of purchase consideration and, therefore, depreciation is allowable on it and therefore the same has been allocated amongst various assets it acquired from J.K. Synthetics Limited." 6.3.1 From the above Para of the assessee's submissions before the Assessing Officer, we find that even from the assessee's submission, it comes o....
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....ck Exchange Ltd. (supra). As per this judgment, it was held by Hon'ble Apex Court that if the judgment of Jurisdictional High Court was not considered by the Tribunal because the same was not brought to the notice of the Tribunal, it is a mistake apparent from record which required rectification. In the present case, it is not the allegation of the assessee that any judgment of Hon'ble Jurisdictional High Court was not considered by the Tribunal for any reason and hence, in our considered opinion, this judgment of Hon'ble Apex Court is not rendering any help to the assessee in the facts of the present case. 8.2 The second judgment cited by Learned A.R. of the assessee is the judgment of Hon'ble Allahabad High Court rendered in the case of Commissioner of Income-tax Vs Mool Chand Shyam Lal (supra). In this case, it is held by Hon'ble Allahabad High Court that if the facts of a particular case have been recorded incorrectly or some error has crept in, which does not require any debate and is apparent on the record, such a mistake can be corrected in exercise of powers under section 254(2) of the Act. There is no quarrel on this proposition but in the present case....
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....ifth judgment cited by Learned A.R. of the assessee is the judgment of Hon'ble Allahabad High Court rendered in the case of Commissioner of Income-tax Vs K.M. Sugar Mills (P.) Ltd. (supra). In that case, it is noted by Hon'ble Allahabad High Court that it is not in dispute that ground Nos. 2,3 and 4 set out in the memorandum of appeal have not been adjudicated upon by the Tribunal. Under these facts, it was held by Hon'ble Allahabad High Court that the failure of the Tribunal to decide these three grounds is a mistake apparent from the record and therefore, the Tribunal was perfectly justified in recalling the order u/s 254(2) of the Act. In the present case, this is not the claim of the assessee that any ground raised by the assessee was not decided by the Tribunal and hence, this judgment of Hon'ble Allahabad High Court is not rendering any help to the assessee. 8.6 The sixth judgment cited by Learned A.R. of the assessee is the judgment of Hon'ble Delhi High Court rendered in the case of Lachman Dass Bhatia Hingwala (P.) Ltd. Vs Assistant Commissioner of Income-tax (supra). This judgment of Hon'ble Delhi High Court is by following the judgment of Hon'....
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.... face of the record. The facts in the present case are totally different and therefore, this judgment of Hon'ble Bombay High Court is not rendering any help to the assessee. 9. We have seen that none of the judgments cited by the learned AR of the assessee is rendering any help to the assessee. We would like to make it clear that in the present case, the Learned A.R. of the assessee could not point out any apparent mistake in the Tribunal order and therefore, these Misc. Applications are having no merit. 10. Now we discuss the judgment of Hon'ble Calcutta High Court cited by Learned D.R. of the Revenue rendered in the case of Steel Containers Ltd. Vs Commissioner of Income-tax [1978] 112 ITR 995 (Cal). In that case, it was held by Hon'ble Calcutta High Court that though the powers of the Tribunal may be said to be limited to the subject matter of the appeal before it but the Tribunal is competent to pass such orders on appeal as it thinks fit. It was also held that there is nothing in the Act which restricts the Tribunal to the determination of the questions raised before the departmental authority. It was also held that all questions whether of law or of facts, which....