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Oriental Bank of Commerce Versus ACIT, Circle-13 (1) , New Delhi

2016 (1) TMI 746 - ITAT DELHI

Rectification u/s 154 - depreciation @100% or 15% on interiors which are purely wooden structures - Held that:- Rectification under Section 154 can only be made when a glaring mistake of fact or law committed by the Officer passing the order as apparent from the record. Rectification is not possible when question is debatable. Moreover, a point which was not examined on the facts or in law cannot be dealt with as a mistake apparent from the record. Therefore, we hold that the issue whether the d .....

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llant by : Sh. K.V.S.R. Krishna, CA Respondent by : Sh. P. DAM Kanunjna, Sr. DR ORDER PER INTURI RAMA RAO, A.M.: The appeal filed by the assessee-bank is directed against the order of ld. CIT(A), dated 20.10.2010 passed for the assessment year 2005-06. The assessee-bank raised the following grounds of appeal: i. The Hon ble CIT(A) has erred in law and on facts in upholding the rectification order passed by the AO u/s 154 dt. 30.11.2007. There is no mistake apparent from record, which is sought t .....

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to the above, that there is no rectification possible u/s 154 of the Income Tax Act, 1961, the CIT(A) has erred in upholding the denial of the claim of depreciation on temporary wooden structures at 100%, which is the rate prescribed under the Income Tax Rules-I, building (4) and restricting it to 15% only merely on the ground that the assessee has classified the same as furniture and fixtures in earlier years. The disallowance of depreciation of ₹ 12,14,26,196/- should be deleted. iv. 3(a .....

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es of ₹ 111,45,95,050/- of Erstwhile Global Trust Bank as declared in the return for the Asstt. Year 2005-06. The appellant claims that the Erstwhile Global Trust Bank Ltd. is no longer existing and has been amalgamated w.e.f. 14.08.2004 and the loss of Erstwhile Global Trust Bank Ltd. as returned and existing as on the date of amalgamate shall be deemed to be the loss of Oriental Bank of Commerce because of the amalgamation and should be accepted as such i.e., the returned loss of ₹ .....

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income of ₹ 174,45,44,140/-. Against the said return of income, the assessment was completed under Section 143(3) of the Income-tax Act, 1961 (for short the Act ) vide order dated 20th March, 2006 at a total income of ₹ 664,17,56,342/- after making several disallowances. Being aggrieved by this disallowances, the appellant preferred an appeal before the learned CIT(A). While the matter stood thus, the Assessing Officer sought to rectify the assessment order on the following two issue .....

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the Oriental Bank of Commerce, the difference of ₹ 57,06,98,798/- is proposed to be added back. The assessee bank objected the rectification proceedings vide his letter dated 30.11.2007 on the ground that there was no mistake apparent from record arising out of the order sought to be rectified and placed reliance on the decision of the Hon ble Apex Court in the case of T.S. Balaram, ITO Vs. Volkart Bros and Others, 82 ITR 50. The assessee company contended that the claim of 100% depreciat .....

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d fixture does not act as estoppel from claiming the deprecation @ 100%. The Assessing Officer brushing aside the explanation of the assessee bank passed an order dated 30.11.2007 under Section 154 of the Act withdrawing the excess depreciation of ₹ 12,14,26,196/-. Being aggrieved by this order, an appeal was filed before the CIT(A) who vide para 5.2 of his order dated 20th October, 2010 rejected the claim of the assessee, which reads as under: I have carefully considered the assessment or .....

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appellant company, the appellant company has reclassified the above assets as temporary wooden structure claiming depreciation @100%. It is observed by the AO that the appellant had not furnished any explanation or documentary evidence to justify its claim. Further, the above classification as Furniture & Fixture and the claim of depreciation @ 15% in the hands of GTB were also duly supported by the Auditor s Report. Before me also, the Ld. AR has not furnished any basis for charging the cl .....

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peal. 2. The assessee bank raised six grounds of appeal. Ground nos. 1 to 3 relates to the claim of depreciation @ 100% on the temporary structures and ground no. 4 was not pressed by the learned counsel for the assessee. Accordingly, ground no. 4 is dismissed as such. Ground nos. 5 and 6 are general in nature which do not require any adjudication. 3. Before us, the learned Authorized Representative contended that the Assessing Officer ought not have exercised the jurisdiction under the provisio .....

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g the jurisdiction under Section 154 of the Act or not. The Assessing Officer withdrawn the depreciation to the extent of ₹ 12,14,26,196/- on interior temporary wooden structures. The Assessing Officer at the time of original assessment after going through the details filed by the assessee bank allowed the depreciation @ 100%, whereas vide the impugned proceedings, the Assessing Officer allowed the depreciation only @ 15% treating as a furniture and fixtures and the balance of depreciation .....

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t enable the Assessing Officer to exercise the jurisdiction under Section 154 of the Act. There is no specific provision under the provisions of Income Tax Act that the depreciation on the assets acquired pursuant to the scheme of amalgamation should be allowed at the same rate of depreciation which was allowed in the hands of the amalgamating company. There is nothing on record to show that the assessee bank is not entitled for depreciation @ 100% in respect of the interiors which was purely wo .....

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ITR 208, held that the right to rectify the mistakes under Section 154 of the Act cannot be invoked in the case of change of opinion. A rectifiable mistake is a mistake which is obvious and patent and not something which has to be established by a long drawn process of reasoning or where two opinions are possible. Further, in our opinion, the issue at what rate a particular asset is eligible for depreciation per se is a debatable issue as it requires examination of materials, details, particular .....

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