9911796707
TMI Blog2017 (5) TMI 1539X X X X Extracts X X X X X X X X Extracts X X X X ..... redit as well as the Inward Gate Passes (IGP) showing receipt of incoming materials / items in the factory premises. Copies of the IGPs in respect of items contained in the invoices mentioned by the AO in the assessment order were also submitted. AO vide his remand report has mentioned that he has duly verified the statutory Excise returns filed with the Central Excise Department alongwith Cenvat credit records wherein the said Cenvat credit pertaining the Chemical Recovery Plant (CRP) was entered and also its corresponding entries in the Excise records - RG 23 C Part II (Entry book of duty credit of capital goods) and tallied the same with the Central Excise records, original invoices and original IGPs. The original IGPs which are made at the time receipt of the material were also produced before the AO during the remand proceeding and were duly verified by him and tallied with the relevant invoices. The AO has not made any adverse comment whatsoever on merit. Thus addition made by the AO cannot be sustained on facts or in law.- Decided in favour of assessee - ITA No. 2263/Del/2012 - - - Dated:- 11-5-2017 - Shri S.V. Mehrotra, Vice President And Shri Sudhanshu Srivastava, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed the following grounds of appeal:- 1. The Id. CIT (A) has erred on facts and in law in deleting addition of ₹ 99,01,500/- on account of depreciation on paper brand. 2. The Id. CIT (A) has erred on facts and in law in deleting addition of ₹ 7,44,36,109/- on account of disallowance of depreciation on chemical recovery plant. 3. Ld. DR submitted that the paper brand was a capital expense but was not a depreciable asset and was rather an appreciable asset whose asset value enhanced with time. It was further submitted that the paper brand did not fall within the meaning of section 32(1) of the Income Tax Act and, therefore, was not eligible for depreciation. It was further submitted that the Ld. CIT (A) had erred in directing that this addition be deleted and depreciation be allowed. 3.1. On the second ground before the ITAT, it was submitted that the basic condition of claiming depreciation of any asset was that the asset must have been put to use during the relevant assessment year. Ld. DR submitted that in case the asset is not put to use, depreciation will not be allowable. Ld. DR submitted that construction and testing are prior to the asset being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess or commercial rights of similar nature. Therefore, the interpretation of the AO - that since brand is not specifically mentioned in Section 32(1) (ii), it cannot be equated with trade mark and hence, depreciation on the same is not admissible - appears to be based on lack of proper appreciation of the provisions of the above Section which specifically includes not only trade mark but also any other business or commercial rights of similar nature . Further, since trade mark has not been specifically defined under the I T. Act, as pointed out by the Ld. AR vide written submission reproduced supra, we have to rely on the definition of trade mark under the Trade Marks Act, 1999. As per Section 2(zb) of the Trade Marks Act, 1999 trade mark includes mark and the definition of mark as per Section 2(m) of the above Act specifically includes brand as follows: mark includes a device, brand, heading, label, ticket, name, signature, or any combination thereof. Further, as pointed out by the Ld. AR, as per para 7, 8 and 9 of the Accounting Standard 26 (AS 26) issued by the ICAI, the definition of intangible asset and trade mark specifically includes bra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsidering the rule of consistency as the assessee s claim for depreciation on the said brands has been allowed by the AO in the earlier two assessment years, I find that the impugned addition of ₹ 99,01,500/- made by the AO cannot be sustained. The same is, therefore, deleted. 5.1 This finding of the Ld. CIT (A) could not be controverted by the department before us. The department also could not point out any judicial precedents in favour of the revenue on this issue. We, therefore, uphold the finding of the Ld. CIT (A) on this issue and dismiss this ground of appeal of the department. 5.2 Similarly, the issue relating to depreciation on the chemical recovery plant has been discussed at length in Para 6.5 and 6.6 of the impugned order which are being reproduced hereunder for a ready reference: - 6.5 I have carefully considered the assessment order and the remand report of the AO and the submissions made by the Ld. AR alongwith the documents placed on record. I find that the additional evidence submitted by the appellant are merely by way of further corroboration of the claim of the assessee made in the return of income and during assessment proceeding that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. Further, the said expansion project was appraised and financed by the State Bank Group led by SBI which appointed M/s R.R. Dehra Associates, an independent firm of Chartered Engineers to monitor the implementation of above project and to submit periodical reports / certificates with regard to the progress of the said project. A copy of the reports / certificates dated 30.04.2008 issued by the above Chartered Engineer firm certifying that the said project was commissioned on 21.03.2008 was filed before the AO during the assessment proceeding, copy of which is filed by the appellant as part of the Paper Book. It is further argued by the Id. AR that a copy of the publication regarding status of implementation of the above project as per the Stock Exchange and SEBI guidelines was also submitted before the AO. Further, copy of Board Resolution of the assessee company dated 29.04.2008 stating that the date of commissioning of the Chemical Recovery Plant was 21.03.2008 was also filed before the AO. The assessee has also charged in its book an amount of ₹ 19,98,090/- as depreciation on the above plant for the period of one month as per the Companies Act. Copies of al! the bills ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
