TMI Blog2009 (5) TMI 923X X X X Extracts X X X X X X X X Extracts X X X X ..... sed Under Section 263 Is Invalid and Bad-Law:- Order passed by the Commissioner of Income Tax Act enhancing/modifying the order passed by the Deputy Commissioner of Income Tax under section 143(3) for the Assessment Year 2001-2002 is invalid and bad-in-law and requires to be cancelled since,- i) the Income tax Assessment order passed by the Deputy Commissioner of Income tax-Pune under section 143(3) allowing depreciation on WDV of Goodwill (an Intangible asset) based on thorough scrutiny of facts and allowability conaldorod as per the provisions of Income tax Act in earlier years, is not erroneous. ii) Income tax Assessment order under section 143(3) passed deferring the deduction of Goodwill as revenue expenditure by allowi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2) Stamp Duty paid for transfer ₹ 7,06,300 (3) Transfer fee/Differential premium paid to MIDC ₹ 9,44,272 Total Rs.1,57,76,572 By agreement for sale Greaves Limited sold to us entire undertaking for total consideration of ₹ 28 Crores which includes amount paid of ₹ 1,141,26,000/- rights in land given on lease at Baramati. As desired by you we attach herewith copy of agreement between MIDC and Greaves Limited and subsequent agreement of transfer rights to Piaggio Greaves Vehicles Ltd. (now Known as Piaggio Vehicles Pvt. Ltd.) Intangible as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vehicle Garuda b. Marketing rights in TOTO including export rights; c. technical know-how for manufacturing of Garuda ; d. Transfer of trained work-force on existing terms. 4. In the assessment order framed on 16th January 2004 the Assessing Officer disallowed the depreciation on leasehold rights and set out elaborate reasons of doing so. However, so far as deprecation on goodwill was concerned, the Assessing Officer did not make any comments on the submissions of the assesses and granted the depreciation. 5. The matter, however, did not rest there. 6. On 21st October 2006, learned Commissioner issued a show cause notice requiring the assessee to show cause as to why the assessment order dated 16th January 2004 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer has not applied to such a claim. As we do so, let us also bear in mind the fact that in the assessment years 1999-2000 onwards, the same claim was allowed by the Assessing Officer in the course of assessments framed u/s 143(3) of the Act. 9. As held by Hon'ble Delhi High Court in the case of Gee Vee Enterprises vs. Addl. CIT (99 ITR 375), even an inertia of the Assessing Officer in examining a claim, when he ought to have examined the same does render the assessment order erroneous. However, as far as situation before us is concerned, we have noted that the Assessing Officer had detailed explanation of the claim of depreciation on goodwill before him and that the same claim was allowed in the earlier years. There was no chang ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law that when an Assessing Officer takes a view of the matter on merits, his order cannot be subject to review merely because other view is possible, as was held by the Hon'ble Supreme Court in the case of CIT vs. Malabar Industrial Co. Ltd, (243 ITR 83). In view of these discussions, and peculiar facts of this case, we hold that there is no material to conclude that the Assessing Officer did not apply his mind to assessee's, claim of depreciation on goodwill. Accordingly, the very foundation of learned Commissioner's assumption of jurisdiction is not good in law. 10. For the reasons set out above, we vacate the impugned order for want of validity of jurisdiction. As we do no, however, we refrain from making any observation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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