Calcutta High Court
Principal Commissioner Of Income ... vs M/S. National Engineering ... on 27 July, 2022
OD-12
IN THE HIGH COURT AT CALCUTTA
SPECIAL JURISDICTION (INCOME TAX)
ORIGINAL SIDE
ITAT/70/2022
IA NO: GA/1/2022
PRINCIPAL COMMISSIONER OF INCOME TAX-2, KOLKATA
VERSUS
M/S. NATIONAL ENGINEERING INDUSTRIAL LTD.
BEFORE :
THE HON'BLE JUSTICE T.S. SIVAGNANAM
And
THE HON'BLE JUSTICE BIVAS PATTANAYAK
Date : 27th July, 2022
Appearance :-
Ms. Smita Das De, Adv.
... For Appellant
Mr. Asim Choudhury, Adv.
Mr. Soham Sen, Adv.
The Court : This appeal filed by the revenue under Section 260A of the
Income Tax Act, 1961 (the Act, for brevity) is directed against the order dated
16th December, 2021 passed by the Income Tax Appellate Tribunal, "C" Bench,
Kolkata (Tribunal) in ITA No. 2109/Kol/2019 for the financial year 2015-16.
The revenue has raised the following substantial question of law for
consideration:
"Whether on the facts and circumstances of the case the Learned
Tribunal was justified in law in allowing the claim of balance additional
depreciation on the assets which were put to use for less than 180 days
in earlier years?"
2
We have heard Ms. Smita Das De, learned standing Counsel appearing
for the appellant/revenue and M/s. Khaitan & Co., learned Advocates for the
respondent.
It is not disputed before us that the question of law raised in this appeal
is covered by the decision in the case of Dy. CIT vs. Brakes India Ltd., I.T.
Appeal No. 1069 (Mds.) of 2010, dated 6.1.2012, which judgment was upheld
by the Hon'ble Supreme Court as the revenue's Special Leave Petition was
dismissed by judgement dated 24th September, 2018. The said decision in
Brakes India Ltd. was followed in the case of Commissioner of Income Tax,
Chennai vs. Aztec Auto (P.) Ltd., (2020) 119 taxmann.com 215 (Madras). The
operative portion of the said judgement reads as follows :-
"7. The assessee preferred an appeal before the Commissioner of Income-
tax [Appeals]-I CIT(A), Chennai, who by order dated 14-7-2016 allowed the
appeal. In doing so, followed the decision of Addison & Co. Ltd. v. Dy. CIT
[I.T. Appeal No.2198 (Mds.) of 2015, dated 4-3-2016]. In this order, the
Tribunal noted the decision in the case of Dy. CIT v. Brakes India Ltd. [I.T.
Appeal No.1069(Mds.) of 2010, dated 6-1-2012], which was decided
against the assessee. However, the CIT(A) took note of the decision above
mentioned and observed that those were rendered after considering the
decisions in Brakes India Ltd. (supra) and CRI Pumps (P.) Ltd. v. Asstt. CIT
[2013] 34 taxmann.com 123/58 SOT 154 (Chennai - Trib.) and it was held
that additional depreciation to the extent not claimed by the assessee in
the earlier year ought to be allowed.
10. Be that as it may, the decision of the Tribunal in the case of Brakes
India Ltd. v. Dy. CIT [T.C. A. No.551 of 2013, dated 14-3-2017], was
appealed against before the Division Bench of this Court in and the
Division Bench noted the decision in Rittal India Limited as well as M.M.
Forgings and ultimately, allowed the appeal filed by the assessee. In
doing so, the Division Bench of this Court distinguished the decision in the
case of M.M. Forgings Ltd. (supra) by observing that the said case was not
concerned with the issue with regard to right to carry forward the balance
additional depreciation and followed the decision in the case of CIT v. Shri
T.P. Textiles (P.) Ltd. [2017] 79 taxmann.com 411/246 Taxman 324/394
ITR 483 (Mad.), which was decided in favour of the assessee and in which
decision, the decision in the case of Rittal India (P.) Ltd. (supra), was also
referred to.
12. In our considered view, the effect of the insertion of the proviso in the
year 2016, may not have a bearing on the present issue, as during the
relevant assessment year 2009-10, the law which has been settled by the
Division Bench of this Court is the case of Brakes India Ltd. (supra),
against the said decision, the revenue preferred an appeal before the
Hon'ble Supreme Court in S.L.P. (C) No.033755/2017 which was
dismissed by an order dated 24-9-2018. Thus, the decision of the Division
Bench in the case of Brakes India Ltd. (supra) having been approved by
the Hon'ble Supreme Court, we are bound by the said decision and
accordingly, following the same.
For the above reasons, the appeal filed by the Revenue is dismissed and
the substantial question of law is answered against the Revenue. No
costs."
Thus, following the above decision, the appeal filed by the revenue is
dismissed and consequently, the questions of law are answered against the
revenue.
The stay application being IA No.GA/1/2022 stands closed.
(T.S. SIVAGNANAM, J.)
(BIVAS PATTANAYAK, J.)
S.Pal/SN
AR(CR)
