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2023 (5) TMI 116 - AT - Income TaxRevision u/s 263 - depreciation on goodwill claimed by the amalgamated company - assessee is a amalgamated company and claimed depreciation @ 25% on opening WDV towards intangible asset which represents goodwill created on amalgamation - HELD THAT:- In this case, the amalgamating company has not claimed depreciation on goodwill. The assessee company, which is amalgamated company only created goodwill due to amalgamation. Under these facts and circumstances of the case, AO ought to have examined as to how the depreciation is claimed by the amalgamated company, whether the depreciation claimed by the amalgamated company is in accordance with law or not and the Assessing Officer should have been issued notice under section 142(1) of the Act and called for the details and should have examined the issue. The amalgamating company has not claimed any depreciation. The burden cast upon the Assessing Officer to call for the details and examine the same. AO has totally ignored the artificial creation of goodwill for claiming depreciation - By examining entire records of the assessee and after considering the explanations, the ld. PCIT came to the conclusion that the AO has not at all examined the artificially created goodwill by amalgamating company and thus, we are of the opinion that the assessment order passed by the AO is erroneous and prejudicial to the interest of Revenue. Decided against assessee.
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