TaxTMI 
TaxTMI 
2023 (7) TMI 1267
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....tronic devices guided by external computers and cannot carry out any of the functions of a computer and therefore depreciation as applicable to computers cannot be allowed for ATMs. 2.3 The CIT(A) erred in not appreciating the decision of the Hon'ble High Court of Karnataka in the case of M/s. Diebold systems Private Limited Vs. Commissioner of Commercial taxes, wherein it was clearly held that ATM is neither a computer nor a part of a computer but an electronic device only. 3. For these grounds and any other ground including amendment of grounds that may be raised during the course of the appeal." 3. The brief facts of the case are that, the assessee M/s. Financial Software and Systems Pvt Ltd., is engaged in the business of providing software and related services for banking and financial service sector. The appellant particularly provides services in electronic payment transactions under different modules. The assessee has filed its return of income for the assessment year 2020-21 on 12.02.2021, by admitting total income of Rs. 43,55,26,900/-. The case was selected for scrutiny and during the course of assessment proceedings, the Assessing Officer noticed that the asses....
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.... has been considered by the Tribunal in assessee's own case for the assessment year 2015-16 & 2016-17 in I.T.A. Nos. 2126 & 2127/Chny/2019 dated 17.03.2020, wherein, the Tribunal by following earlier decision in assessee's own case for the assessment year 2013- 14 and 2014-15 and held that the assessee is entitled for 60% depreciation on ATM machines. The relevant findings are as under: "9. We heard the rival submissions and perused the material on record. The issue in the present appeal is covered in favour of the assessee in assessee's own case for assessment years 2013-2014 and 2014-2015, wherein it is held as follows. "6. We have heard the rival submissions. The primary facts stated hereinabove remain undisputed and hence the same are not reiterated for the sake of brevity. he short point that arise for our consideration is as to whether the ATMs are eligible for depreciation at the rate of 60% treating it at par with the computer and computer peripherals. The ld DR vehemently argued that the ATM is not a computer and it is merely a cash dispensing machine. From the paper book submitted by the assessee, more particularly in pages 1 to 4, it is evident from the pictorial rep....
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....switches are also to be included in the block of computers entitled to depreciation at the rate of 60%. We find that the ATM machine is doing the logical, arithmetic and memory functions by manipulations of electronic magnetic or optical impulses giving debit or credit cash and thereafter dispenses the case and gives a printed receipt and hence it could be safely concluded that computer is an integral part of ATM machine and on the basis of the information processed by the computer in the ATM machine only, the mechanical functions of the dispensation of cash or deposit of cash is done. 8.2.1. We find that the issue is dealt with by the co-ordinate bench of Delhi Tribunal in the case of Global Trust Bank Ltd. (supra), wherein it was held that :- 7. ATM is the computerized telecommunication device that allows bank's customers to access the bank at places other than the normal bank without having to take the trouble to go to the bank in person and collect the cash as is done under the conventional method of withdrawing money from the bank. The ATM machines are computerized machines which not only allow the customers to withdraw money but they can check the account balance, pay....
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....lations or it is specifically so provided in one statute to give the same meaning to the words as defined in other statute. The aim and object of the two legislations, namely, the Gift-tax Act and the Estate Duty Act are not similar. It is obvious that the purpose behind introduction of Karnataka VAT Act and Income Tax Act 1961 are totally different and moreover one is a state legislation and another is a central legislation. Hence the words and expressions in one statute cannot be imported into another statute unless both the statutes are pari materia legislations or one statute provides for the meaning to be imported specifically from another statute in respect of certain words and expressions. In the instant case, none is present and hence the reliance placed on the decision of Hon'ble Karnataka High Court rendered in the context of Sales Tax Act supra does not advance the case of the revenue. 6.3. In any case, we find that the decision of Hon'ble Bombay High Court on the very same issue is in favour of the assessee in the case of CIT vs Saraswat Infotech Ltd in Income Tax Appeal (L) No. 1243 of 2012 dated 15.1.2013. The question raised before the Hon'ble Bombay High Court w....
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.... 7) Accordingly, the appeal is dismissed with no order as to costs. 6.4. We find that the Hon'ble Apex Court in the case of CIT vs Vegetable Products Ltd reported in 88 ITR 192 (SC) had held that when there are two conflicting decisions of two different high courts (non-jurisdictional) , then the construction that is favourable to the assessee is to be adopted. 6.5. Hence in the instant case, the decision of Hon'ble Bombay High Court supra which was rendered in the context of Income Tax Act and duly addressing the arguments of the ld DR before us also, would rule the fort and accordingly we direct the ld AO to grant depreciation at the rate of 60% on ATMs for the Asst Year 2013-14 and the grounds raised by the assessee in this regard are allowed. This decision would apply with equal force for Asst Year 2014-15 also''. The submission of the ld. CIT-Departmental Representative that higher rate of depreciation cannot be allowed on ATM machines as applicable to the computers cannot be accepted in view of the fact the Hon'ble Karnataka High Court in the case of Diebold Systems (P.) Ltd. (supra) wherein while interpreting an entry in the schedule in Karnataka Sales Tax Act, 1957 on....