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2022 (1) TMI 424 - AT - Income TaxAllowability of depreciation on goodwill - As per AO goodwill is not covered within the meaning of intangible assets which means only know-how, patent, copyrights, trademarks, license, franchisee on any other business or commercial rights of similar nature - HELD THAT:- As decided in own case [2021 (3) TMI 683 - ITAT DELHI] DRP has not at all considered the aspect of depreciation on goodwill in correct context as there is a finding identical to that of earlier years, assessee entered into a world-wide multi-year outsourcing agreement with IBM India Pvt. Ltd., Network Solutions Pvt. Ltd. and IBM Daksh Business Process Services Pvt. Ltd. as well as Acquisition Agreement and this is not an initial year of claim of depreciation on goodwill. Hence, in light of the decision of the earlier years by the Tribunal the appeal of the assessee is allowed. Allowability of education cess and higher secondary education cess as an expenditure - HELD THAT:- We find the Hon’ble Bombay High Court in the case of Sesa Goa Limited vs., JCIT [2020 (3) TMI 347 - BOMBAY HIGH COURT] has held that since the term “Cess” is not included in clause (ii) of section 40(a)of the I.T. Act, 1961, there is no prohibition in claiming the same as a deduction in computing income chargeable under head of profits and gains of business or profession. Similar view has been taken by the Hon’ble Rajasthan High Court in the case PCIT vs., Chambal Fertilizers and Chemicals Ltd.[2018 (10) TMI 589 - RAJASTHAN HIGH COURT] wherein it has been held that education cess is not a disallowable expenditure under section 40(a)(ii) - we are of the considered opinion that education cess and secondary education cess paid on income tax is an allowable expenditure. Accordingly, the additional ground raised by the assessee is allowed.
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