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TMI Blog2022 (1) TMI 530X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act on the ground that there is failure on the part of the assessee to disclose fully and truly all the material facts to complete the assessment. As gone through the reasons recorded by the Assessing Officer and also considered the entire facts of the case find that there is a failure on the part of the assessee to disclose all the information before the Assessing Officer and therefore, the Assessing Officer has reopened the assessment by issuing notice under section 148 of the Act dated 18.03.2010, which is beyond four years, in our opinion, the reopening of assessment is valid and it is in accordance with law. Thus, the ground of appeal raised by the assessee is dismissed. Depreciation on the Bridge - The assessee could not controvert the fact that the assessee is only a contractor and not owner of the bridge and thereby, the assessee is not entitled to claim depreciation. Secondly, the claim of depreciation on the expenditure incurred on development and construction of infrastructural facilities including bridges on BOT basis with right to collect toll has been clarified by the CBDT that the assessee do not hold any right in a BOT project except recovery of toll free ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... toll is contrary to the decisions of Tribunals and High Courts in this regard. 4. The Commissioner of Income Tax (Appeals) has erred in not considering the case laws filed by the Assessee in its support and arbitrarily rejecting them as not applicable to the facts of the case. 3. The assessee has assailed two solitary grounds, out of which, the first ground relates to reopening of assessment and second ground relates to allowability of depreciation. So far as reopening of assessment is concerned, the Assessing Officer has completed the assessment under section 143 of the Income Tax Act, 1961 [ Act in short] by order dated 20.02.2008, wherein, the Assessing Officer has noted that the assessee has claimed depreciation on the Bridge @ 25%, applicable to Plant and Machinery. The Assessing Officer further noted that the bridge is not a plant and the definition of plant has been modified in the Income Tax Act, wherein, it has been specifically stated that building will not be treated as plant. Accordingly, the Assessing Officer restricted the claim of depreciation on the bridge to 10% and the remaining 15% claim has been disallowed and brought to tax. 3.1. Subsequently, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve heard both the sides, perused the materials available on record and gone through the orders of authorities below. In this case, the assessee has claimed depreciation at 25% by treating the bridge as Plant and Machinery. The Assessing Officer treated the bridge as only a building and allowed depreciation at 10%. Subsequently, the return filed by the holding company of the assessee i.e., East Coast Construction and Industries Ltd., wherein, the said company had vide notes to accounts filed along with the return of income stated that on account of floods during November, 2005, the approach road, pathway and the footpath to the bridge were damaged and that the Karur Municipality cancelled the BOT agreement with the assessee vide their G.O. NS No. 165/166 dated 19.12.2005 and that after carrying out temporary repairs, the bridge has been declared as toll free from January, 2006. On the basis of the above information, it is clear that the assessee is only a contractor and is not owner of the bridge and therefore, the assessee is not entitled to claim depreciation. The Assessing Officer came to the above conclusion on the ground that these facts were not disclosed at the time of origin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bridges on BOT basis with right to collect toll has been clarified by the CBDT that the assessee do not hold any right in a BOT project except recovery of toll free to recoup the expenditure incurred and therefore, the assessee cannot be treated as the owners of the property and cannot be allowed depreciation under section 32(1)(ii) of the Act. By considering the above notification of the CBDT, considering all the facts and provisions of the Act, we find that the ld. CIT(A) has rightly directed the Assessing Officer to allow amortization of the expenditure incurred during the tenure of the agreement and thus, no interference is called for in the order passed by the ld. CIT(A). Thus, the ground raised by the assessee stands dismissed. I.T.A. No. 3108/Chny/2018 [AY: 2004-05] 11. The first ground raised in the appeal of the assessee is relating to reopening of assessment. In this case, the return filed by the assessee was processed under section 143(1) of the Act on 16.12.2005. Subsequently, the assessment was reopened on the ground that the assessee is not owner of the bridge and this fact was came to the notice of the Assessing Officer from the records of M/s. East Coas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us, the ground raised by the assessee is dismissed. 15. So far as merits of the case are concerned, we have decided the issue of depreciation claim hereinabove in the assessment year 2003-04 in ground No. 2 raised by the assessee and the above order is squarely applies to the assessment year 2004-05 also and accordingly, the claim of depreciation stands dismissed. I.T.A. No. 3109/Chny/2018 [AY: 2005-06] 16. The first ground raised in the appeal of the assessee is relating to reopening of assessment. In this case, the return filed by the assessee was processed under section 143(1) of the Act on 29.06.2006 accepting the income returned by the assessee. Subsequently, the assessment was reopened by issuing notice under section 148 of the Act dated 02.07.2008 on the ground that there is escapement of income, which is within four years of processing the return filed by the assessee. The facts and circumstances of the case are similar to that of the assessment year 2003-04 narrated hereinabove and in view of our decision for the earlier assessment years, we hold that the assessment order passed under section 143(3) r.w.s. 147 of the Act dated 21.12.2009 is valid. 17. So fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 08-09. Accordingly, the claim of depreciation stands dismissed. 21. The next ground raised by the assessee relates to confirmation of disallowances of other expenses of ₹ 26,42,583/- and the Assessing Officer has disallowed the same on the ground that the assessee has not carried out any business. In the financial year 2005-06 itself, the Tamil Nadu Government vide its G.O.Ms. No. 165/166 dated 19.12.2005 cancelled the BOT agreement and therefore, the assessee has not carried out any business. Subsequent to the cancellation of agreement by the Tamil Nadu Government, the Assessing Officer has held that no expenditure can be allowed and the same was confirmed by the ld. CIT(A). 22. The ld. Counsel for the assessee has submitted before us that the assessee has not stopped the business and it was only temporary lull in the business and therefore, it was argued that the expenditure incurred by the assessee was for the purpose of the business and the same may be allowed. 23. On the other hand, the ld. DR strongly supported the orders of authorities below. 24. We have heard both the sides, perused the materials available on record and gone through the orders of authoriti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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