Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (6) TMI 542 - AT - Income TaxDepreciation claimed on non–compete fee - claim of depreciation on non–compete fee @ 25% by treating it as an intangible asset is acceptable or not? - HELD THAT:- As decided in assessee's own case [2019 (5) TMI 411 - ITAT MUMBAI] allowed assessee’s claim of depreciation by treating the non–compete fee as an intangible asset. The same view was reiterated by the Tribunal while deciding assessee’s appeal for subsequent year also. Therefore we uphold the decision of the learned Commissioner (Appeals) on the issue in allowing claim - we direct the A.O. to allow deprecation on non–compete fee @ 25% by treating it as an intangible asset. - Decided against revenue Disallowance of depreciation on various fixed assets on the basis of wrong actual cost - HELD THAT:- while deciding identical issue in the preceding assessment years in assessee’s own case, the Tribunal has restored the issue to the Assessing Officer for fresh adjudication. In this context, we may refer to the latest order passed by the Tribunal for the assessment year 2006–07 [2016 (10) TMI 1037 - ITAT MUMBAI]. Facts being identical, respectfully following the consistent view expressed by the Tribunal in the preceding assessment years, we restore the issue to the Assessing Officer for de novo adjudication. Disallowance of interest expenditure u/s 36(1)(iii) - investment of funds in sister concerns - HELD THAT:- While deciding identical issue in the latest order passed by the Tribunal in assessee’s own case for the assessment year 2005–06 [2019 (5) TMI 411 - ITAT MUMBAI] decided the issue in favour of the assessee by holding that the investment of funds in sister concerns are for the purpose of business - we delete the disallowance made by the Assessing Officer. Disallowance of interest on account of interest free loans to the subsidiary - HELD THAT:- This is a recurring issue between the assessee and the Department from the preceding years. In the latest order passed by the Tribunal in assessee’s own case for the assessment year 2006–07 [2016 (10) TMI 1037 - ITAT MUMBAI] Unutilized credit of Central Value Added Tax (CENVAT) u/s 145A - HELD THAT:- As decided in assessee’s own case in the assessment year 2006–07 [2016 (10) TMI 1037 - ITAT MUMBAI] direct the Assessing Officer to value the closing stock strictly in terms of section 145A, keeping in view the principle laid down in judicial precedents referred to above and only after providing due opportunity of being heard to the assessee. TPA - adjustment to the arm's length price of interest fee loan advanced to Piramal Glass, U.K. and corporate guarantee provided to the Associated Enterprise (AE) - HELD THAT:- As regards the rate at which interest on interest free loan is to be computed, we find that learned DRP has directed the Assessing Officer to compute interest at LIBOR plus 3%. We find that while deciding identical issue in assessee’s own case in assessment year 2007–08 [2019 (5) TMI 411 - ITAT MUMBAI] the Tribunal has directed to compute interest on interest free loan advanced to the AE at LIBOR plus 200 basis points. Insofar as adjustment on account of corporate guarantee commission is concerned, the Tribunal has directed the Assessing Officer to compute the corporate guarantee fee @ 0.5%. Similar view was expressed by the Tribunal while deciding assessee’s appeal in assessment year 2011–12. Respectfully following above, we direct the AO to compute interest on interest free loan to AE at LIBOR plus 200 basis points and corporate guarantee commission @ 0.5%. Addition on account of foreign exchange gain arising out of loan given to the subsidiary companies - DRP directed the Assessing Officer to delete the addition - HELD THAT:- As per section 144C(13) of the Act, the Assessing Officer is duty bound to implement the directions of learned DRP. In view of the aforesaid, we direct the Assessing Officer to comply with the statutory mandate by implementing the directions of learned DRP on the issue and delete the addition. Short grant of TDS - HELD THAT:- We direct the AO to verify the facts relating to assessee’s claim and grant credit for TDS as per law.
|