2004 (8) TMI 641 - AT - Income Tax

Issues Involved:
1. Claim of depreciation on shuttering material.
2. Evidence of receipt and use of shuttering material before the end of the financial year.
3. Validity of purchase invoices and transportation records.
4. Discrepancies in vouchers and dates.
5. Acceptance of claims by CIT(A) and subsequent appeals by Revenue and Assessee.

Issue-wise Detailed Analysis:

1. Claim of Depreciation on Shuttering Material:
The assessee, a construction firm, claimed depreciation at 100% on shuttering material worth Rs. 21,22,267, which was allegedly given on hire to a sister concern, M/s. Wig Brothers (B&E) Delhi Area Project. The Assessing Officer rejected this claim, citing that the assessee did not conduct any construction activity except maintenance work during the year and failed to provide evidence of machinery receipt before the year-end.

2. Evidence of Receipt and Use of Shuttering Material Before the End of the Financial Year:
The CIT(A) directed the Assessing Officer to verify the delivery of shuttering material at the project site before the financial year's end. The CIT(A) accepted the delivery evidence for materials from M/s. S.G.B. (India) Ltd. and M/s. Bajaj Products, totaling Rs. 9,26,087, but rejected the claim for Rs. 11,96,180 from M/s. Steel Star Industries due to lack of supporting evidence.

3. Validity of Purchase Invoices and Transportation Records:
The CIT(A) found that the purchases from M/s. S.G.B. (India) Ltd. and M/s. Bajaj Products were supported by agreements, dispatch notes, and transportation details, including truck numbers and freight payments. However, for M/s. Steel Star Industries, there was no dispatch advice note, transportation records, or agreement of purchase, leading to the rejection of the claim for this supplier.

4. Discrepancies in Vouchers and Dates:
The Assessing Officer noted that certain vouchers had altered dates, with original dates showing 6-4-1991 being antedated to 31-3-1991. This discrepancy was a significant factor in rejecting the claim of timely receipt and use of the shuttering material from M/s. Steel Star Industries.

5. Acceptance of Claims by CIT(A) and Subsequent Appeals by Revenue and Assessee:
The CIT(A) accepted the claim for Rs. 9,26,087 based on verified evidence but rejected the claim for Rs. 11,96,180 due to lack of corroborative evidence. The Revenue appealed against the acceptance of Rs. 9,26,087, while the assessee appealed against the rejection of Rs. 11,96,180. The Tribunal upheld the CIT(A)'s conclusions, finding no merit in the Revenue's appeal and supporting the rejection of the assessee's additional claim due to insufficient evidence.

Conclusion:
The Tribunal concluded that the assessee failed to demonstrate the delivery and use of shuttering material from M/s. Steel Star Industries before 31-3-1991. The evidence presented did not satisfy the requirements for claiming depreciation for the impugned year. Both the Revenue's and the assessee's appeals were dismissed, sustaining the CIT(A)'s order.

Final Judgment:
The appeals by both the Revenue and the assessee were dismissed, confirming the CIT(A)'s decision to allow depreciation on Rs. 9,26,087 and reject the claim for Rs. 11,96,180.

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