TaxTMI 
TaxTMI 
2023 (5) TMI 753
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....No. 1 : Mr. Sandeep Goyal, Advocate, in VATAP No. 178 of 2017 and VATAP No. 148 of 2018. For the Respondent No. 1 : Dr. Malkiat Singh, Advocate, in VATAP No. 128 of 2019 and VATAP No. 281 of 2018. For the Respondent No. 1 : Dr. Malkiat Singh, Advocate, Mr. Narinder Sindher, Advocate, Mr. Rajat Turka, Advocate and Mrs. Rakasha Raghav, Advocate, in VATAP No. 267 of 2019-M/s New India Construction Co. MANISHA BATRA , J. 1. The aforementioned appeals have been preferred under Section 36 of Haryana Value Added Tax Act, 2003 (hereinafter referred to be as "Act, 2003") by the revenue against the orders passed by the Haryana Tax Tribunal, Chandigarh (for short "the Tribunal") on 24.03.2017, 16.03.2018, 11.10.2018, 16.03.2018 and 13.11.2....
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....t deduction on account of depreciation of plant and machinery was wrongly allowed by the assessing officer and it revised the order of assessing officer thereby disallowing deduction on account of depreciation in plant and machinery. 4. Feeling aggrieved, the respondent-assessee filed appeal before the Tribunal challenging the order of revisional authority whereby additional tax had been levied for the A.Y. 2010-11. The Tribunal vide order dated 24.03.2017 allowed the appeal. 5. Feeling dissatisfied, the VAT Appeal No. 178 of 2017 has been preferred by the revenue on the grounds that the order passed by the Tribunal was liable to be set aside as the fact that depreciation on plant and machinery could not be allowed as deduction as it ....
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....it was argued by learned counsel for the respondent-assessee that the respondent-assessee was certainly entitled for exemption not only on the charges for obtaining on hire or otherwise machinery and tools used for execution of the works contract but also on the amounts spent by it on such machinery as a consequence of using them for the execution of works contract. He submitted that the value of the goods involved in execution of works contract was to be determined by taking into account several factors which included charges for obtaining on hire or otherwise machinery and tools used for execution of the works contract and, therefore, those charges were deductible. To fortify his argument, learned counsel for the respondent placed relianc....
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....ning and architect's fees: (d) charges for obtaining on hire or otherwise machinery and tools used for the execution of the works contract; (e) cost of consumable such as water, electricity, fuel, etc., used in the execution of the works contract the property in which is not transferred in the course of execution of a works contract; (f) cost of establishment of the contractor to the extent it is relatable to supply of labour and services; (g) other similar expenses relatable to supply of labour and services; (h) profit earned by the contractor to the extent, it is relatable to supply of labour and services. It was further held by Apex Court that the amounts deductible under these heads wi....
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....ortionate depreciation of machinery and tools to the extent to which they had been exclusively used for execution of the works contract and owned by the dealer. It was held that notwithstanding the fact that the word "depreciation" itself did not figure in either of the deductions mentioned in the course of the judgment of Hon'ble Supreme Court in Gannon Dunkerley & Co.'s case (Supra), but the deductions towards proportionate depreciation of machinery and tools to the extent to which they had been exclusively used for the execution of the works contract, deserved to be allowed. In Veeaar Constructions's case (Supra), the High Court of Andhra Pradesh while dealing with similar issue had observed that the assessee was entitled for exemption n....
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....at the principles of law as laid down in Gannon Dunkerley & Co.'s case (Supra) were not discussed in Thampi & Company's case (Supra). Therefore, the Tribunal while allowing the appeal filed by the respondent-assessee and allowing deduction on account of depreciation of plant and machineries made by the respondent-assessee by observing that the said deduction would cover charges for obtaining on hire or otherwise machineries of the assessee cannot be held to be at any fault and therefore the order passed by the Tribunal deserves to be upheld. Since this question of law had been raised in all the five instant appeals, therefore, the same stands answered in favour of the respondents-assesses of these appeals and against the appellant. 10. I....