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TMI Blog2018 (8) TMI 2037X X X X Extracts X X X X X X X X Extracts X X X X ..... ome Tax (Appeals) in accepting assessee s claim. Accordingly, the findings of Commissioner of Income Tax (Appeals) are upheld and the appeal of the Revenue is dismissed. - ITA No.1637/PUN/2016 - - - Dated:- 31-8-2018 - SHRI D. KARUNAKARA RAO AND SHRI VIKAS AWASTHY, JJ. Appellant by : Written Submission Respondent by : Shri Sanjeev Ghei ORDER VIKAS AWASTHY, J. This appeal by the Revenue is directed against the order of Commissioner of Income Tax (Appeals)-1, Nashik dated 19-05-2016 for the assessment year 2012-13. The Revenue in appeal has raised solitary ground against the findings of Commissioner of Income Tax (Appeals) in allowing depreciation @ 25% on the license to collect toll. 2. The brief facts of the case as emanating from records are : The assessee is engaged in the business of operation and maintenance of infrastructure facility etc. The assessee filed its return of income on 17-09-2012 for the assessment year 2012-13 declaring total income as Nil. In scrutiny assessment proceedings the Assessing Officer disallowed assessee s claim of excess depreciation ₹ 2,59,72,798/- on the right to collect toll. The stand of the assessee is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... torists using the road. On expiry of the specified period, respondent is under the obligation to transfer the constructed road to the NHAI, without any cost or charge i.e. free of cost. It is only upon construction of road, appellant was bestowed with the 'right to collect toll'. Thus, in effect, to obtain 'toll collection right', appellant incurred cost of road construction and there is direct link between the cost incurred on construction of road and the toll collection right acquired by the respondent. Further, to enable respondent to collect toll from the motorists using the road facility, the Government of India has issued a notification dt. 20.02.2008 (Page Nos 05-06). Kindly, note that, no person is authorized to collect any toll from the motorists using the road, unless enabling notification is issued by the concerned Government. Else the toll collection is illegal and prohibited by law. It was by this notification, appellant got right to collect toll, for the period from 20.02.2008, on making investment of about ₹ 70.86 Crores in construction of the infrastructure facility. Therefore, according to respondent, in commercial reality, the underlying asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Honourable 'B' Bench in the respondent's own case i.e. Ashoka DSC Katni By-pass Road Pvt. Ltd v/s DCIT in ITA NO.239/PN/2012 for Assessment Year 2008-09 Page (Nos.15- 18). Further, respondent's claim is also supported by 1) the recent decision of the Honourable 'A' Bench in the respondent's group concern case i.e Ashoka Highways (Durg) Ltd vis ITa in ITA No. 1629/PUN/2016 and Ashoka Highway (Bhandara) Limited vis ITa in ITA No.1630/ PUN/2016 for Assessment year 2012-13, decided by the combined order dt 08.06.2018. Copy of the said Order is enclosed for ready reference (Page Nos 19-33). The Circular No. 9/2014 dt. 23.04.2014 is also duly considered by the Hon'ble ITAT in this decision. 2) The recent ITAT Special Bench decision in the case of Progressive Construction Ltd (Page Nos. 34 - 48). In this decision also the CBDT Circular No. 9/2014 dt. 23.04.2014 is duly considered. Therefore, it is prayed to dismiss the appeal of Department, by upholding the decision of the learned CIT(A) - I, Nashik. For Ashoka DSC Katni By-pass Road Pvt. Ltd. 4. Shri Sanjeev Ghei representing the Department fairly admitted that the issue raised in the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee under the head License to collect Toll‟ have been incurred for development and construction of the infrastructure facility, i.e., Dewas By-pass Road. It is also not in dispute that the assessee was to build, operate and transfer the said infrastructure facility in terms of an agreement with the Government of Madhya Pradesh. The expenditure on development, construction and maintenance of the infrastructure facility for a specified period was to be incurred by the assessee out of its own funds. Moreover, after the end of the specified period, assessee was to transfer the said infrastructure facility to the Government of Madhya Pradesh free of charge. In consideration of developing, constructing, maintaining the facility for a specified period and thereafter transferring it to the Government of Madhya Pradesh free of charge, assessee was granted a Right to collect Toll‟ from the motorists using the said infrastructure facility during the specified period. The said Right to collect the Toll‟ is emerging as a result of the costs incurred by the assessee on development, construction and maintenance of the infrastructure facility. Such a right has been adjudicate ..... X X X X Extracts X X X X X X X X Extracts X X X X
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