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2013 (11) TMI 186 - AT - Income TaxDisallowance of Depreciation on Goodwill – Payment Made Over and Above the NAV – Slump Sale Agreement – Business Transfer - appellant contended that as part of business transfer there were certain other intangible assets that were acquired viz., knowhow, employees, business information, business records - Held that:- The specified intangible assets acquired under slump sale agreement were in the nature of "business or commercial rights of similar nature" specified in Section 32(1)(ii) of the Act and were accordingly eligible for depreciation under that Section - Decided in favor of assessee. Areva T & D India Ltd. v. DCIT [2012 (4) TMI 79 - DELHI HIGH COURT] - applying the principle of ejusdem generis, which provided that where there were general words following particular and specific words, the meaning of the latter words shall be confined to things of the same kind, as specified for interpreting the expression "business or commercial rights of similar nature" specified in Section 32(1)(ii) of the Act, it is seen that such rights need not answer the description of "knowhow, patents, trademarks, licenses or franchises" but must be of similar nature as the specified assets – Decided in faovur of Assessee. Provision for Liquidated Damages - Expenses Towards Information Technology & Marketing Support Activities - Disallowance of the share of common expenses – Held that:- Held that:- Disallowance of warranty provision, the reasoning adopted by the Assessing Officer as well as CIT(A) was that the assessee had only followed approximation method instead of taking into consideration the liquidated damages as claimed by the concerned parties – in the absence of any record maintained on the claim raised by the assessee, the CIT(A) had rightly held that the liability in question was an unascertained one and not allowable - Consequently, qua this ground of the assessee, we confirm the findings of the CIT(A). The CIT(A)’s order that on the one hand he was directing the Assessing Officer to verify and allow the expenditure and on the other hand, he had disallowed the entire expenditure claimed by the assessee unmindful of the fact that the Assessing Officer himself had accepted the same - the findings of the CIT(A) in this regard were mutually contradictory. The whole expenditure claimed by the assessee as capital expenditure” was disallowed and directed the Assessing Officer to pass a fresh order after due verification of the claim raised by the assessee in accordance with law by affording adequate opportunity of hearing. Accordingly, this ground is partly accepted for statistical purpose.
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