Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2009 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2009 (8) TMI 838 - AT - Income TaxRevision u/s 263 - Whether CIT indeed erred in invoking jurisdiction u/s 263 - Domestic company engaged in the business of manufacturing and distribution of aerated and non-aerated beverages - Assessment u/s 143(3) was completed - CIT held that the assessment order passed by the AO was erroneous and prejudicial to the interest of the revenue, that CIT was justified in assuming revision jurisdiction u/s 263, and that the depreciation claimed on goodwill, needs to be withdrawn. Aggrieved by the stand so taken by the CIT, the assessee is in appeal before us. The claim of the assessee was that the AO has allowed depreciation on goodwill after due application of mind and after considering all the related aspects of the matter. Therefore, even if another view of the matter is possible, CIT cannot take recourse to section 263 for adopting such other view. HELD THAT:- We find that on materially identical facts of the case and dealing with the legality of revision proceedings on the ground that the AO had allowed depreciation on goodwill, Pune ‘A’ Bench of this Tribunal, in the case of Piaggio Vehicles (P.) Ltd. v. Dy. CIT [2009 (5) TMI 923 - ITAT PUNE], We are in considered agreement with the views of the Co-ordinate Bench. As for ld DRs contention that the CIT cannot be a silent spectator to such a wrong grant of depreciation and that the CIT must safeguard the interests of the Revenue, all we can say is that, on the facts of the present case and particularly when CIT has withdrawn depreciation on goodwill on the ground that such a claim is patently inadmissible, we are unable to approve his stand on merits and we must also follow the Co-ordinate Benches which have decided the same issue, on materially identical facts, in favour of the assessee. As we have noted earlier in this order, Bharatbhai’s case [2005 (8) TMI 279 - ITAT AHMEDABAD-C] dealt with a situation in which goodwill amount was paid to the retiring partner but it did not result in the acquisition of any assets which fit the description of section 32(1)(ii). These facts are not similar to the case before us in which assessee’s claim, which has not been refuted on merits, was that the payment for goodwill has resulted in acquisition of commercial rights which are covered by section 32(1)(ii). Ld DR’s very erudite arguments on the merits of the case are also not relevant for our purposes, as we are refraining from giving any findings on the merits. Suffice to say that in view of the above discussions, and for the detailed reasons set out above, CIT indeed erred in invoking jurisdiction u/s 263. The impugned order is, therefore, set aside. In the result, the appeal is allowed.
|