2023 (1) TMI 962 - AT - Income Tax
Excess depreciation on goodwill arising out of demerger - bar to raise legal issues for the first time before ITAT - transfer of assets and liability from the demerged company to the assessee - HELD THAT:- As decided in assessee own case [2018 (10) TMI 1036 - ITAT AHMEDABAD] AO has simply disputed the quantification of eligible depreciation spanning over various financial years on the ground that depreciation is eligible from the appointed date as sanctioned by the Hon’ble Gujarat High Court. Thus, on account of such re-working, the assessee has presented a new claim towards depreciation on goodwill in the impugned AY 2009-10 on the ground that all the relevant facts are available on record which are duly admitted by the Revenue. Therefore, the assessee cannot be deprived of the eligible depreciation as computed by the AO himself concerning AY 2009-10.
Cross objection filed by the assessee u/s 253(4) - We find ourselves in agreement with the propositions made on behalf of the assessee that in a cross objection, there is no bar to raise legal issues for the first time before ITAT. A cross objection is like an appeal. It has all the trappings of an appeal. It is filed in the form of memorandum and it is required to be disposed in same manner as an appeal. Even where the appeal is withdrawn or dismissed for default, cross objection may nevertheless be heard and determined. Cross objection is nothing but an appeal, a cross appeal at that. This apart, raising of additional ground would only enable the authority concern to correctly assess the tax liability of the assessee.
In the present case we observe that where the AO has readjusted the quantum of depreciation in the subsequent assessment year, the assessee is within its legitimate rights to be granted depreciation in AY 2009-10 as per the figures worked by the AO himself. We do not see any perceptible reason for not admitting such claim of the assessee. We also find bonafides in the plea of the assessee for raising new claim on account of depreciation by way of additional ground at this belated stage. Appeal filed by the assessee is allowed.