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TMI Blog2019 (3) TMI 1702X X X X Extracts X X X X X X X X Extracts X X X X ..... nd no. 2 relates to deletion of addition of Rs. 36,00,000/- being the reduction from the secured loan and deletion of hire purchase suspense account from 'other current assets' on the basis of a general comment of the auditor without rebutting the observation of the Assessing Officer that the liability has been met up by the assessee from some undisclosed income. 3. Now we shall take issue no. 1 raised by the Revenue which relates to disallowance of depreciation of Rs. 85,17,966/-. 5. The brief facts qua the issue are that theduring the assessment proceedings, AO had disallowed Rs. 85,17,966/- on account of additional depreciation claimed by the assessee. The AO in his assessment order had stated that the assessee being a civil contractor, had to deploy various kinds of plant and machinery which includes several machines like JCB, Excavator etc. and goods transport vehicles like tippers for carrying raw materials etc. to different sites across the country. Assessee also maintained various kinds of motor vehicles to carry workers to the sites and for the use of the officials/directors. In its return of income, the asessee is found to have shown 30% on the WDV of vehicles used fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15% of depreciation rates. 7. Aggrieved by the stand so taken by the Assessing Officer, the assessee carried the matter in appeal before the ld. CIT(A) who has deleted the addition. Aggrieved, the Revenue is in appeal before us. 8. Before us, the ld. DR has primarily reiterated the stand taken by the Assessing Officer which we have already noted in our earlier para and the same is not being repeated for the sake of brevity. On the other hand, the ld. Counsel for the assessee defended the order passed by the ld. CIT(A). 9. We have heard both the parties and perused the material available on record. We note that only the point of dispute is that whether the assessee is entitled to depreciation at higher rate of 30% for tippers against the normal rate of depreciation @ 15%. It is not disputed, that tippers are vehicles and are registered under the Motor Vehicle Act,1988. The Assessing Officer had disallowed depreciation claimed @ 30% and restricted depreciation to 15% and disallowed Rs. 85,17,966/- as excess depreciation. The main reason given by the Assessing Officer in his assessment order u/s 143(3) of the Act, was that the explanation given by the assessee that his vehicles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we rely on the order of the Hon'ble Supreme Court in RadhasoamiSatsang vs. CIT 193 ITR 321 (SC), wherein it was held as follows: "We are aware of the fact that, strictly speaking, res judicata does not apply to income tax proceedings. Again, each assessment year being a unit, what is decided in one year may not apply in the following year but where a fundamental aspect permeating through the different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year. On these reasoning, in the absence of any material change justifying the Revenue to take a different view of the matter - and, if there was no change, it was in support of the assessee - we do not think the question should have been reopened and contrary to what had been decided by the Commissioner of lncome-tax in the earlier proceedings, a different and contradictory stand should have been taken." We are of the view that the above cited precedents on principle of consistency are squarely applicable to the assessee under consideration. 11. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted a written submission, vide letter dated 16.12.2016, which is reproduced below: "With reference to your above subjected proceedings and in response to your show cause notice dated 09.12.2016, we would like to submit before your honour that Rs. 36,00,000/- shown in the Balance Sheet as on 31.03.2010 under "Other Current Assets" against "Hire Purchase Interest Suspense" represents the amount of interest on term loan accrued but not due as on the date of the balance sheet. In other words, this is the amount of un-matured interest which shall be payable in future years over the tenure of the term loan. On the other hand, the same amount is included in outstanding amount of term loan in liabilities side of the balance sheet. Further, in the balance sheet as on 31.03.2011, hire purchase interest suspense amount has been deducted from the amount of term loan for disclosure compliance of Schedule VI of the Companies Act, 1956. Accordingly, the corresponding amount of the previous year in the Balance sheet as on 31.03.2011 has been re-grouped to make it comparable with the figures of the current year. We therefore, request your honour not to add this amount to profit since t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the submission of the ld counsel that in the balance sheet as on 31.03.2011, hire purchase interest suspense account has been deducted from amount of term loan for disclosure compliance of schedule V1 of the Companies Act, 1956 and the same is supported by the audit report and certification of the Auditor. Therefore, we are of the view that the said amount of Rs. 36.00,000/- does not represent income. It is just re-grouped, reworked, re-arranged, reclassification of the figures in the balance sheet of the assessee for the purpose of presentation in the balance sheet and no any unaccounted money was introduced by the assessee company. Hence, after a careful consideration of the submission of the ld Counsel and relevant assessment records, the addition of Rs. 36,00,000-, made by AO on account of hire purchase interest suspense account is not justified. The asset side of the balance sheet and liability side of the balance sheet both are diagnosed and we note that this is just an accounting entry and presentation in the balance sheet therefore, addition made by the Assessing Officer needs to be deleted. That being so, we decline to interfere in the order of the ld. CIT(A), on this iss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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