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2023 (9) TMI 896 - HC - Income TaxTP Adjustment - adjustment on account of purchase of intangibles - Tribunal stating that TPO has not rejected the valuation of assessee on the basis of any objective reasoning - HELD THAT:- Among the various intangibles one head was trade-mark. The cost of acquiring the trade-mark was capitalized by the assessee and depreciation was claimed by computing taxable income. The value attributed to trade-mark was only Rs. 46.57 lacs approximately out of the total consideration of Rs. 28.51 Crores. The assessee has also submitted valuation reports of independent valuer. On the remaining intangibles assessee capitalized the same but did not claim any depreciation or claim it as any revenue expenditure. But notwithstanding that TPO has given an opinion that the weightage that the assessee gave to different territories for which the credit card business was acquired from the HSBC was not correct. Assessee had given higher weightage to India territory as credit card penetration was low in comparison to other countries which showed that there was more scope to increase the business in India. According to the TPO because the credit card business was much more advance in other countries a higher weightage should have been given to other countries than it was given to India. We wonder when did an AO become a businessman. How much to invest, what weightage is to be given etc., in our view, is a measure of commercial expediency. The expression commercial expediency, as held in S.A. Builders Ltd. v. Commissioner of Income-tax (Appeals) and Another [2006 (12) TMI 82 - SUPREME COURT] is an expression of wide import and include such expression as a prudent businessman incurred for the purpose of business and agreed with the view taken in Dalmia Cement (B) Ltd. [2001 (9) TMI 48 - DELHI HIGH COURT] that the revenue cannot justifiably claim to put itself in the arm chair of the businessman or the position of the board of directors and assume the role to decide how much is reasonable expenditure having regard to the circumstances of the case. No businessman can be compelled to maximize his profit. The income tax authorities must put themselves in the shoes of the assessee and see how a prudent businessman would act. The authorities must not look at the matter from their own view point but that of a prudent businessman. No wrong in the conclusion arrived at by the ITAT.
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