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IN THE INCOME TAX APPELLATE TRIBUNAL,
MUMBAI BENCH 'C', MUMBAI
Before Shri T.R. Sood, AM and Shri V. Durg Rao, JM
I.T.A.No. 3249/Mum/2009
Assessment Year : 2005-06
Dy. Commissioner of Income-tax, M/s. Crystal Granite & Marble Pvt.
Range 9(1), Room No. 223, Aayakar Ltd., Dynamix House,
Bhavan, M.K. Road, Vs. Gen. A.K. Vaidya Marg,
Mumbai 400 020. Goregaon (East), Mumbai 400 063.
PAN: AAACC 1661 J
(Appellant) (Respondent)
Appellant by : Shri Vijay Varma
Respondent by : Shri Vijay Mehta
ORDER
PER T.R. SOOD, AM:
In this appeal the Revenue has raised the following grounds:
"1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting disallowance of Rs. 25,15,048/- by allowing the depreciation @ 100% instead of 25% on the written down value of the water recycling plant allowed by the Assessing Officer, without appreciating the fact that system was just meant for reducing/preventing the breakage of marbles and granites.
2. On the facts and in the circumstances of the case and in law, the learned CIT(A) has erred in deleting the addition made by the Assessing Officer amounting to Rs. 2,45,628/- on account of contribution to employees provident fund paid after the due date as defined in the explanation below section 36(1)(va) of the I.T.Act, 1961.
3. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in directing to make adjustment in the value of opening stock in terms of the provisions of section 145A of the Income-Tax Act, 1961 without appreciating that the opening stock of the relevant assessment year being the closing stock of the immediately preceding year, any adjustment in the value of the opening stock will disturb the closing stock of the preceding year resulting in chain reaction of changes defeating the intent of section 145A of the Income-tax Act, 1961."
2. As regards ground No. 1, after hearing both the parties, we find that this issue came up before the Tribunal in the assessee's own case for the assessment year 2006-07 in ITA No. 2713/Mum/09 dated 10.02.2010 and the same was decided vide paras 9 and 9.1 which read as under:
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M/s. Crystal Granite & Marble Pvt.Ltd.
We have heard the rival submissions and considered them carefully. After considering the submissions and relevant material on record, we find that the ld CIT(A) was justified in allowing the claim of the assessee. The findings of the ld CIT(A) are given in para 2.5 which are as under:
"2.5 I have gone through the appellant's submission as well as the Assessing Officer's argument and I am of the considered view that in modern days, no industry is permitted to run without having a Pollution Control Machinery. From the above description of the whole processing and cutting of the granite rocks, it is clear that the water recycling plant/water recycling plant/water filtration system installed at the premises of the appellant is a water pollution control plant and this equipment is essential to control and prevent ground water pollution in the surrounding areas. The appellant's contention is also supported by the Chartered Engineer's certificate who has inspected the Water Recycling Plant installed at the factory premises of the appellant company and certified that this plant controls water pollution as it mechanically disposes the generated turbid and waste water and also cleans disposes the sludge mixed up with water during the process of cutting and polishing and this equipment is essential for granite industry as per the requirement of the environmental authority and pollution Control Board to control and prevent the ground water pollution in the surrounding area. The Karnataka State Pollution and Control Board, Bangalore has therefore granted its consent under the provisions of the water Prevention and of Pollution Act, 1974, vide letter dtd. 23.08.2007, which is valid up to 30.09.2008. thus, considering the totality of the facts and evidence on record, I hold that water recycling plant/water filtration system is eligible for 100% depreciation as per the new Appendix-I, Part-A, III(ix)(n) of the I.T. Rules. The Assessing Officer is therefore directed to allow depreciation on water recycling plant @100% as against 25% already allowed to the assessee. This ground of appeal is allowed."
9.1 The above findings of the ld CIT(A) does not require any interference as the findings are as per provisions of law and as per I T Rules. The explanation offered by the assessee before the CIT(A) as well as here before us is correct and therefore, without going further into details, we confirm the findings of the ld CIT(A), which remain uncontroverted also."
3. Since the facts are identically same, following earlier order of the Tribunal, we decide this issue against the revenue.
4. As regards ground No. 2, admittedly the provident fund was paid within grace period which was disallowed by the Assessing Officer. However, the same was allowed by the learned CIT(A).
5. Before us the learned Departmental Representative relied on the order of the Assessing Officer.
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6. On the other hand, the learned counsel for the assessee submitted that payments were made within the grace period and, therefore, the same should have been allowed in view of the decision of the Hon'ble Madras High Court in the case of CIT vs. Shri Ganapathy Mills Co. Ltd. (243 ITR 879).
7. After considering the rival submissions carefully, we find that the Hon'ble Madras High Court in the case of CIT vs. Shri Ganapathy Mills Co. Ltd.(supra) has held that payments made within the grace period to the Provident Fund Authorities are allowable as deduction under section 43B. Following that decision, we decide the issue against the revenue.
8. As far as ground No.3, after considering the rival submission, we find that during the assessment proceedings the Assessing Officer noticed that assessee had not added the amount of sales tax paid to the closing stock in terms of section 145A of the Act and, therefore, the Assessing Officer had added this amount towards the income of the assessee.
9. On appeal, the learned CIT(A) deleted the addition vide para 5.2 of his order on the basis that the payments pertained to excise duty.
10. After considering the rival submissions carefully, we find force in the submission of the learned counsel for the assessee that the issue basically relates to payment of sales-tax. It was further pointed out that sales-tax was not included in the purchases itself that is why the same is not included in the sales-tax also. However, we find that the learned CIT(A) had allowed the assessee's appeal but on the basis of excise duty which is not correct. Therefore, we set aside the order of the learned CIT(A) and remit the matter back to the file of the Assessing Officer for re-consideration of the issue and verify whether the sales-tax paid was included in the purchases or not and then decide the issue accordingly. Needless to say that the assessee should be afforded adequate opportunity of being heard. 4 ITA No.3249/M/09
M/s. Crystal Granite & Marble Pvt.Ltd.
11. In the result, the appeal is allowed for statistical purposes.
Order pronounced on this 3rd day of March 2010.
Sd. Sd.
(V.Durga Rao) (T. R. Sood)
Judicial Member Accountant Member
Mumbai dated the 3rd March, 2010.
Copy to:
1. The Assessee
2. The Revenue
3. The CIT-IX, Mumbai
4. The CIT(A)-IX, Mumbai
5. The DR 'C' Bench, Mumbai By order
/True copy/
kn/ Asst. Registrar, ITAT, Mumbai
5 ITA No.3249/M/09
M/s. Crystal Granite & Marble Pvt.Ltd.
S.No. Details Date Initials Designation
1 Draft dictated on 26.02.2010 Sr.PS/PS
2 Draft Placed before author 02.03.2010 Sr.PS/PS
3 Draft proposed & placed before the Second JM/AM
Member
4 Draft discussed/approved by Second Member JM/AM
5. Approved Draft comes to the Sr.PS/PS Sr.PS/PS
6. Kept for pronouncement on Sr.PS/PS
7. File sent to the Bench Clerk Sr.PS/PS
8 Date on which the file goes to the Head clerk
9 Date of Dispatch of order
6 ITA No.3249/M/09
M/s. Crystal Granite & Marble Pvt.Ltd.
Order proncounced on
.
2. At the time of hearing none appeared on behalf of the assessee- appellant as well as no petition for adjournment was filed. We find from the records that assessee-appellant was served notice by registered post acknowledgement due twice and the acknowledgement cards duly signed by the assessee on 25.07.2007 and 16.11.2007, received back. It is therefore, presumed that the assessee is not interested in pursuing the appeal filed by it. It has been held by the Hon'ble Madhya Pradesh High Court in Estate of Late Tukojirao Holkar vs. CWT (223 ITR 480)(MP) that if the party, at whose instance the reference is made, fails to appear at the hearing or fails in taking steps for preparation of paper-books, so as to enable hearing of the reference, the Court is not bound to answer the Reference. The decision of the Delhi Bench of the Tribunal in CIT vs. Multiplan (India) Pvt. Ltd., 38 ITD 320 (Del.) is also to the same effect. In the facts of the case we hold that the assessee is not interested in pursuing the present appeal before the Tribunal, accordingly the appeal of the 7 ITA No.3249/M/09 M/s. Crystal Granite & Marble Pvt.Ltd.
assessee is dismissed as unadmitted. The assessee, if so advised, shall be free to move the Tribunal praying for recalling of this order provided the assessee is able to establish the reasonable cause behind the non- appearance on the date of hearing and in that case the Tribunal may in its discretion recall this order and the appeal may be restored for re-hearing.
3. In the result, appeal of the assessee is dismissed.
Order pronounced in the open court on 18.12.2007.
2. From the grounds filed by the assessee before the learned Commissioner of Income-tax (Appeals) we find that the levy pertained to concealment of income of Rs. 1,02,744/- and the penalty levied was Rs. 22,248/-. Therefore in view of CBDT Circular F.No. 279/Misc.142/2007-IT dated 15th May, 2008 the appeal is not maintainable, tax effect being less than Rs. 2 lakhs. Vide para 4 of this Circular it is clearly mentioned that the tax effect in ascertaining monetary limits for filing of appeals, in the case of penalty orders, would mean quantum of penalty deleted or reduced.
3. Therefore, appeal of the Revenue is dismissed as not maintainable.
Order pronounced on this _______ day of May, 2009.
(G.C. Gupta) (Abraham P. George)
Judicial Member Accountant Member
Mumbai dated the ______May, 2009.
kn
Copy to:
6. The assessee
7. The ITO-26(1)(2), Mumbai.
8. The CIT, City-XXVI, Mumbai
9. The CIT(A)-XXVIII, Mumbai
10. The DR, 'G' Bench, Mumbai By order
/True copy/
Asst. Registrar, ITAT, Mumbai
8 ITA No.3249/M/09
M/s. Crystal Granite & Marble Pvt.Ltd.
S.No. Details Date Initials Designation
1 Draft dictated on 18.05.09 Sr.PS/PS
2 Draft Placed before author 18.05.09 Sr.PS/PS
3 Draft proposed & placed before the JM/AM
Second Member
4 Draft discussed/approved by JM/AM
Second Member
5. Approved Draft comes to the Sr.PS/PS
Sr.PS/PS
6. Kept for pronouncement on Sr.PS/PS
7. File sent to the Bench Clerk Sr.PS/PS
8 Date on which the file goes to the
Head clerk
9 Date of Dispatch of order
9 ITA No.3249/M/09
M/s. Crystal Granite & Marble Pvt.Ltd.