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2016 (10) TMI 490 - ITAT MUMBAI

2016 (10) TMI 490 - ITAT MUMBAI - TM - Eligibility for depreciation - part payment made for the acquisition of asset - Held that:- Once the assessee receives the rights to construct extra floor/ storey, it enhances the value/cost of the building and assessee under the principle of accounting has debited the entire amount of FSI right to the block of asset of the building by making a corresponding entry as "liability" in the Balance-sheet. This can also be explained by way of an example; suppose, .....

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ty payable to him for the amount which remains to be paid. It is immaterial whether for many years that liability or installment has been paid subsequently or not. Once the corresponding liability in the accounts has been shown, then depreciation on the asset should be given irrespective of the fact that this year only part payment was made for the acquisition of that asset. Thus, we hold that, assessee would be eligible for depreciation for the entire amount of ₹ 3,40,81,320/- debited to .....

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/ building. It strictly pertains to the addition in the building only and, therefore, depreciation allowable would be at the rates applicable to the buildings only and for not some kind of intangible right u/s 32(1)(ii). Accordingly, we uphold the observation and order of the Ld. CIT(A) to the extent that the depreciation allowable would be on rates applicable to the building only that is, @10% and not @ 25% for some kind of intangible right. Thus in our conclusion, the assessee would be entitle .....

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hri Assessee : Vijay Mehta For The Revenue : Shri G M Dass ORDER PER BENCH: The aforesaid cross appeals has been filed by the assessee as well as by the revenue against separate orders passed by Ld. CIT(Appeals)-7, Mumbai against separate impugned orders for the assessment years 2005-06, 2006-07, 2007-08 and 2008-09. Since common issues are involved arising out of identical set of facts, therefore, same were heard together and are being disposed off by way of this consolidated order. 2. We will .....

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ppellant prays that the depreciation on FSI may kindly be allowed @ 25%. Ground No.2 Without prejudice to ground no. 1, on the facts and circumstances of the case, the learned CIT(A) erred in holding that only ₹ 68,16,264 being amount spent during the year for acquiring rights of FSI is to be added to the block of Buildings". The appellant prays that entire consideration towards FSI of ₹ 3,40,81,320/- may be added towards the book of building and the depreciation may be accordin .....

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.2005 declaring loss of ₹ 61,26,06,726/-. The said return of income was subjected to scrutiny proceedings and assessment was completed under section 143(3) vide order dated 26.12.2007, whereby loss was assessed at ₹ 23,23,66,290/-. Later on, the Ld. Commissioner of Income-tax-III, Mumbai, under his revisionary jurisdiction under section 263 called for the assessment records and came to the conclusion that, the assessment order passed was prima facie erroneous and pre-judicial to the .....

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o the extent of FSI available. The grant of FSI is not an commercial/ business asset, therefore, AO should have examined the same. After inviting the assessee s objections and submissions, he set aside the assessment order after observing and holding as under:- The submission of the assessee is perused and considered. The assessee s submission is a matter of details and the AO has not looked into the same at assessment stage as the same was not available to him. The claim of the assessee needs t .....

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on or after the 1st day of April, 1998. So, the language any other business or commercial rights should be of similar nature that of know-how, patents, copy rights trademarks, licenses and franchises. So, the acquisition of FSI by the assessee is no way nearer to the terminology used in section 32(1)(ii) of the Act. In any case, the order of assessment was erroneous and prejudicial to the revenue as it is totally silent about this and therefore there is lapse of omission on the part of the asse .....

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r decide this issue on merits in a speaking order . Thus, his directions were, firstly, that the claim of the assessee needs to be examined by the AO with reference to all the primary records; secondly, possession of additional FSI is not a business / commercial rights and therefore, deprecation cannot be allowed under section 32(1)(ii), that is, @ 25%; and lastly, there was omission on the part of the AO to examine this fact and accordingly, he was directed to examine and consider the submissio .....

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hand, that is, the allowability of depreciation on the additional FSI, the assessee stated the entire facts how it received the FSI and tried to substantiate its claim of depreciation @ 25% on such FSI which was added to the building block of asset, in the following manner:- During the year under consideration, the assessee company acquired certain rights in the form of Additional PSI in pursuance of a letter- dated 01. 12.2003 from Urban Development Department, Gout, of Maharashtra granting an .....

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Brihanmumbai Municipal Corporation that amounted to ₹ 3,40,81,320. Under the instructions of the order dated 04.08.2004 issued by Government of Maharashtra assessee made the payment of 1st installment of ₹ 68,16,264. The copy of order from Government of Maharashtra and letter in connection with payment to Brihanmumbai Municipal Corporation has been enclosed as Annexure A. In view of the fact that the assessee received rights in the form of additional FSI, the same was capitalized in .....

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side the said assessment order of A. 0. and directed the A.O. to pass the fresh assessment order after considering all the evidences in connection with the said claim, of depreciation @25% on PSI, made by the assessee company. In this regard, at the outset, we would like to submit before your goodself that the assessee company had submitted all the evidences with regard to claim of depreciation on PSI. It is just a difference of opinion between the two tax authorities. Hence, the assessee compan .....

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l FSI means the right to construct the additional storeys on account of increase in floor space index (FSI) by virtue of regulation 14 of the Development Control Regulation for Greater Bombay, 1991 (DCR). From the above definition it is crystal clear, that the assessee has acquired business rights on which the assessee has claimed depreciation at 25%. The assessee company has acquired such a right on payment of premium. To substantiate the fact that the acquisition of FSI is a business right, we .....

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ompany to expand its business operations. Here, the assessee would like to invite your goodself's attention to Section 32(1)(ii) of the Income Tax Act, 1961 which is reproduced below for your ready reference: "32. (1) [In respect of depreciation of (i) buildings, machinery, plant or furniture, being tangible assets; (ii) know-how, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature, being intangible assets acquired on or aft .....

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considered as acquisition of business/commercial right. We hope that the explanation given above justifies the claim of depreciation at 25% on Additional Floor space Index 5. However, the Ld. Assessing Officer rejected the assessee s contention on the ground that the grant of additional FSI only got the permission to increase the size of the total building by constructing the additional floors or additional space in the building to the extent of FSI available. The grant of FSI is not in the nat .....

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the income was assessed at loss of ₹ 38,55,51,470/-. 6. In the first appeal against the said assessment order dated 25.11.2009, assessee preferred first appeal before the CIT(A) and gave detailed submissions as to how FSI is an additional business/ commercial right, which would enable the assessee company to expand its business operations and hence it will falls within the scope and ambit of intangible asset . The Ld. CIT(A) held that, the assessee was unable to explain as to how and under .....

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ver, he accepted the assessee s other contention that depreciation should be allowed at @ 10% applicable to building, but he restricted to the amount actually spent for the purpose of business, that is ₹ 68,18,265/- paid towards the FSI, which is for enduring nature as it adds to the value of the existing building. The additional FSI will enable the company to add more floors over and above the existing structure. Since it relates to the building block of assets , the overall cost of the b .....

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2483/Mum/2009 in the appeal filed by the assessee against the revisionary order dated 23.03.2009, passed under section 263 cancelling the original assessment order under section 143(3). In the said order, the Tribunal has confirmed the action of the Ld.CIT in cancelling the assessment order as well as setting aside the issue before the AO for fresh adjudication. It would be relevant to incorporate certain observations and finding of the Tribunal in this regard:- 9. Therefore, the issue of deprec .....

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nd, therefore, would add to the value of and by increasing the constructible area/space and has no independent value without underlying land as well as unitl and unless the additional construction is carried out by using the FSI. It is only an addition in the value of land not eligible for depreciation. The decisions relied upon by the Ld. AR are not applicable in the facts of the present case because the Commissioner has not given the finding on a different issue that of the show-cause notice. .....

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out. As we have discussed in the foregoing para of this order that the FSI has not independent existence de hors the land on which it is to be used. It is only an addition in the usable value of the land and, therefore, unless and until it is used for construction of additional space on a particular land no new asset came into existence either tangible or intangible. Accordingly, we concur with the view of the Commissioner. As regards the objection of giving the finding by the Commissioner that .....

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ibed by the finding and observation of the revision order. The AO is not free to take the independent view or has any discretion to take a decision contrary to the revision order. Hence, the directions are not prejudicial to the interest of the assessee 8. At the outset, it is noticed that the Tribunal has made certain observations, which was neither the issue raised by the CIT in his show cause notice nor there was any finding or observation in the order. It is also completely divorced from the .....

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ition in the value of land not eligible for depreciation. Further, the Tribunal has observed that, FSI has no independent existence de hors the land it is used. It is only an addition in the useful value of the land and unless and until it is used for the transfer construction of additional space on a particular land, no new asset can come into existence, either tangible or intangible. These observations by the Tribunal has transgressed the scope and direction of the revisionary order passed by .....

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the section 33 of DCR 1991 pertaining to Additional Floor Space Index which may be allowed in certain categories, sub-section (4) dealing with building of starred categories of residential hotels has been defined in the following manner:- (4) Buildings of Starred Category Residential Hotels:-With the previous approval of Government and subject to payment of such premium as may be fixed by Government (out of which 50 percent shall be payable to the Corporation), and subject to such other terms a .....

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From this clause, it is quite evident that, FSI is connected with the building alone, that is, right to construct additional floors and such an FSI is never embedded to the land. FSI is the quotient of ratio of the combined gross floor area of all the floors. The assessee got additional FSI of 10022.94 sq. meters which was an additional FSI of 1.5. It is for this additional FSI, the assessee was required to make the payment of premium to Government of Maharashtra and BMC for sums amounting to &# .....

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a belated Cross Objection, wherein the following grounds have been raised:- 1. Whether on the fact and in the circumstances of the case and in law, the learned CIT(A) erred in allowing ₹ 68,16,264/- to be added to the block of Buildings being amount spent during the year for acquiring rights of FSI, in view of the order of Hon ble ITAT vide order dated 01.04.2015 in the appeal No.2483/Mum/2009 holding that the additional FSI is only addition in value of land not eligible for depreciation. .....

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d on 09.03.2016. Along with the CO, the reason mentioned by the Department is that the ITAT has decided the issue of Additional FSI vide order dated 01.04.2015 in favour of the Department, therefore, the Department has decided to file the cross objection subsequent to the order of the Tribunal. It is noticed that, there is no affidavit filed by any officer or any bona fide reasons have been given for filing of Cross Objection after a lapse of period of 5 years. 10. Before us, the Ld. CIT DR subm .....

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1.04.2015 and admittedly, the order was also received by the Commissioner in month of April, 2015, then why the cross objection has filed on 9th March, 2016 which is after time period of 10 months, Ld. DR in response submitted that, there are various stages of approvals which are required from the concerned hierarchy of authorities before filing of the appeal, hence, there was further delay in filing of the cross objection. 11. The Ld. Counsel for the assessee, Mr. Vijay Mehta objecting to the f .....

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Tribunal, then also there is a huge delay of more than 10 months after the receiving of the Tribunal order for which there is no justification. In support of his argument, he strongly placed reliance on the decision of Hon ble Supreme Court in the case of Office of Chief Post Master General and others vs. Living Media Ltd. in Civil Appeal no. 2474 to 2475 of 2012 vide judgment and order dated 24th February, 2012. In that case, there was delay of 427 days in filing of the SLP by the office of Ch .....

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nt or the wing of the government is perty before us. Their Lordships further observed that, in the matter of condonation of appeal, one has to see whether there was any gross negligence or deliberate inaction or lack of bona-fide, a liberal concession has to be adopted to advance substantial justice. However, the claim of the department that the delay is not intentional and is on account of impersonal machinery, departmental/administrative procedures cannot be upheld. Their Lordships held that, .....

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in the process. The government departments are under a special obligation to ensure that they perform their duties with diligence and commitment. Condonation of delay is an exception and should not be used as an anticipated benefit for government departments. The law shelters everyone under the same light and should not be swirled for the benefit of a few. Considering the fact that there was no proper explanation offered by the Department for the delay except mentioning of various dates, accord .....

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al then, decision rendered by the High Court in favour of the assessee on the same issue in later assessment year cannot be said to be sufficient cause for condoning the delay of 5 years in filing the appeal before the Court. Thus, he submitted that, once the Department has consciously accepted the order of the CIT(A), then merely because a subsequent order of the Tribunal has decided the issue in favour of the Department does not mean, it is a sufficient and reasonable cause. 12. We have consid .....

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re of the opinion that, a new ruling in subsequent proceedings or subsequent judicial decision cannot be the ground alone for condoning the delay. The statutory time limit prescribed for filing of an appeal or law laid down in the Limitation Act cannot be stretched to bring about a situation of unsettling a judicial decision or any order which stood accepted by the parties. The entire mandate of the law would get frustrated if the litigant who has taken a decision not to pursue any further proce .....

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reason for such a delay has been contended to be on account of procedure of approval from various authorities. Such a bureaucratic red tapism has been frowned by Hon ble apex Court on several occasions and in the case relied upon by the Ld. Counsel in the case of Office of Chief Post Master General vs Living Media Ltd. (supra) the Hon ble Supreme Court has come down very heavily on the Government Department for flouting the law of limitation on the ground that, there is lot of procedures involv .....

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t is dismissed. 13. Now, we come to the assessee s appeal, wherein ground no.1, relates to disallowance of deprecation @ 25% by treating the FSI received as intangible asset. As discussed above, the assessee had contended that it is in the business of hoteliering and acquisition of FSI for building extra floor space is a business right which is useful for expanding the business operation of the assessee company. The acquisition of FSI is nothing but an additional business/commercial right which .....

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iness. In any case, alternatively he submitted that, it is a part of block of asset, because the assessee has shown it in the Schedule of block of assets as FSI for the sums amounting to ₹ 3,40,81,320/-. Since it is part of the block of asset relating to building, depreciation @ 10% should be allowed to the whole of the amount and not for the part of the amount as held by the Ld CIT(A). This argument has been made with reference to the issue raised in ground no.2. Regarding the decision of .....

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d by any parties nor it is borne out of order against which the appeal was preferred. In any case, he submitted that, there are series of decisions of this Tribunal, wherein it has been held that, the Development rights available to the assessee as per DCR 1991 is separate and distinct from the original right in the land and such right cannot be held to be embedded in the land. In support, he strongly relied upon the decision of ITAT Mumbai Bench in the case of Land Breeze CHS Ltd, reported in [ .....

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such a right is definitely a 'Capital Asset' held by the assessee and assignment of such a right in favour of the developer amounts to transfer of capital asset. It is held that transfer of TDRs amounts to transfer of a 'Capital Asset [Para 15]" "The reasoning and the logic given by the Assessing Officer and the Commissioner (Appeals) that these development rights were embedded with the land and therefore, the sum chargeable to cost has to be ascribed, it l's held, is .....

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tio decidendi or finding given on the issue involved. In any case, the subject matter of issue arising in assessee s appeal is only whether the additional FSI increases the value of building or not and whether the depreciation should be allowed on the whole of the amount of the FSI, that is, of ₹ 3,40,81,320/- or on the amount paid of ₹ 68,16,264/-. As regards the ld. CIT(A) s observation that depreciation should be allowed only on the part payment, he submitted that, once the paymen .....

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cluded in the value of the land as held by the Hon ble Tribunal in the assessee s own case for the same year, wherein it has been held that additional FSI acquired by the assessee is only the addition on the land not eligible for deprecation, as no new asset has come into existence. In any case, he submitted that, assessee s claim of depreciation on the entire amount of ₹ 3,40,81,320/- cannot be allowed, because the assessee has only made the payment of ₹ 68,16,264/- and to the exten .....

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er stated that on payment of requisite premium to the Government and the BMC, additional FSI of 10022.94 sq. meters would be granted to the assessee which would be additional FSI of 0.476 over and above the existing FSI of 1.5. Subsequently, order from the Government was received on 04.08.2004 wherein the assessee had to make the payment of the premium to the Government and the BMC amounting to ₹ 3,40,81,320/-. Such a payment was to be made under the installment Scheme. In pursuance thereo .....

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current liabilities and the provision , the assessee has shown the liability under the head premium payable at ₹ 2,72,65,056/- (i.e., ₹ 340,81,320 - ₹ 68,16,264). The assessee had claimed depreciation @ 25% on the ground that it is a some kind of business or commercial rights, therefore, it falls within the realm and scope of intangible assets allowable for depreciation @ 25% under section 32(1)(ii). This has been negated by the Ld. CIT(A) on the ground that the FSI does not f .....

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mount paid during the year ₹ 68,16,264/- and not to the entire amount as payable to the Government. 17. As observed in the earlier part of our order, the Floor Space Index is the ratio of the total floor of the building on a certain location to the size of the land of that location. In other words, it is quotient of the ratio of the combined gross floor area of all the floors. Granting of additional FSI gives the right to construct the additional floor/s on account of increase in Floor Spa .....

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unting entries in its books by debiting the entire amount of ₹ 3,40,81,320/- on the asset side of the Balance sheet by debiting to the details of Fixed Assets and the corresponding liability of ₹ 2,72,65,056 which remained unpaid (i.e., ₹ 3,40,81,320 - ₹ 68,16,264= ₹ 2,72,65,056) has been shown as premium payable for additional FSI to the Government/ BMC. Once the entire amount has been debited to the fixed assets and has been brought in the Balance sheet in the Sch .....

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enhances the value/cost of the building and assessee under the principle of accounting has debited the entire amount of FSI right to the block of asset of the building by making a corresponding entry as liability in the Balance-sheet. This can also be explained by way of an example; suppose, assessee would have taken a bank loan for paying the entire or balance premium (say ₹ 2,72,65,056) on FSI to the Government/ BMC, then assessee would have debited the entire amount to FSI account unde .....

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nts has been shown, then depreciation on the asset should be given irrespective of the fact that this year only part payment was made for the acquisition of that asset. Thus, we hold that, assessee would be eligible for depreciation for the entire amount of ₹ 3,40,81,320/- debited to the account of asset. 18. Now, coming to the rate of depreciation, whether it has to be allowed @ 10% or 25%, we do not find any merits in the contention of the assessee that the additional FSI is a business o .....

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gly, we uphold the observation and order of the Ld. CIT(A) to the extent that the depreciation allowable would be on rates applicable to the building only that is, @10% and not @ 25% for some kind of intangible right. Thus in our conclusion, the assessee would be entitled to depreciation @ 10% on the whole of the consideration towards FSI of ₹ 3,40,81,320/-. In view of our finding ground no.1 is treated as dismissed and ground No.2 is treated as allowed. 19. In the result, appeal of the as .....

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on of the AO in disallowing depreciation on intangible assets of ₹ 63,90,248 (25% of ₹ 2,55,60,900). The appellant prays that the depreciation on FSI may kindly be allowed @ 25%. Ground No.2 Without prejudice to ground no. 1, on the facts and circumstances of the case, the learned CIT(A) erred in holding that only ₹ 68,16,264 being amount spent during the year for acquiring rights of FSI is to be added to the block of Buildings". The appellant prays that entire considerati .....

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5-06 and the issues involved are permeating from identical set of facts, therefore, the finding given above in the appeal for the AY 2005-06 will apply mutatis mutandis in this year also. Thus, ground No.1 is treated as dismissed whereas, ground no.2 is allowed. 22. In the result appeal of the assessee stands partly allowed. 23. In the revenue s appeal following grounds have been raised:- 1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in allowing deprec .....

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essing officer to add the amount spent on FSI during the year to the building block of asset and allow depreciation as per law. 2. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in ignoring the fact that the additional FSI is a permission to construct additional space on plot of and therefore, would add to the value of land by increasing the constructible area/space and has no independent value without underlying land as well until and unless the addit .....

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t is seen that, Ld. CIT(A) had followed the order of the CIT(A) for the assessment year 2003-04, 2004-05 and 2005-06. It has been admitted by both the parties that the Tribunal vide order dated 11.03.2015 in ITA nos. 4783 & 5517/Mum/2008 for these assessment years has decided this issue after observing and holding as under:- The next ground of Revenue relates to allowing depreciation on intangible assets of ₹ 8,67,71,053/-. The AO disallowed the depreciation on intangible assets on the .....

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nd my appellate order No.CIT(A) XXXII/IT-204/06-07 dated 22.10.2008 for AY 2003-04. In my appellate order cited above, of pages 15 to 17, paras 10.4 to 10.10, I have held that depreciation on intangible assets is to be allowed in AY 2003-04. As for AY 2004-05, the appellant has claimed the depreciation on intangible assets at ₹ 8,67,71,053/- on account of WDV as on 31.03.2003 (AY 2003-04), and the facts are same. Hence, the depreciation on WDV is therefore, the disallowance of depreciation .....

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spect of the running business which was acquired on slump sale basis . There is no dispute about the computation of depreciation at ₹ 11,50,94,737/-. The claim of depreciation for assessment year under consideration is the first year of such a claim. The AO has also accepted that intangible assets were part of slump sale. The AO has, however, relied mainly on three propositions for the purpose of denying the depreciation. Briefly stated, they are: (i) The appellant had not bifurcated the a .....

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h of such intangible assets. Further, all the intangible assets fall under block of assets on which depreciation is allowable @ 25%. The AO having accepted the fact that intangible assets were acquired by appellant on slump sale basis , in such a case.. of acquisition of an undertaking as a going concern, the. composite consideration cannot be bifurcated between various assets needs to be accepted. The allocation of cost of acquisition for each of assets in a fair and reasonable manner permitted .....

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not been fulfilled cannot be accepted as the invaluable permits license, approvals for the purpose of operating hospitality business squarely falls within the purview of the definition of intangible assets given in Explanation 3 of Section 32 of the Act. 10.8 In this regard, yet another question which the AO has not considered and which can be raised in the 5th proviso to section 32 of the Act which provides that aggregate depreciation allowable to the predecessor and successor in the case of su .....

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so to section 32 of the Income-tax Act, 1961 ( the Act ), whether a part of the depreciation is to be apportioned and to the allowed to predecessor owner. In our considered opinion, we would like to state that the said proviso to section 32 is not applicable to the facts of the assessee s case. The said provisions are applicable to the following cases only:- (1) Transfer of capital assets by a firm to a company as contemplated in section 47(xiii); (2) Transfer of capital assets by a sole proprie .....

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e has become owner of the said hotel. The purchase of Hotel by the assessee from Hotel Corporation of India does not amount to succession in as much as that the said company was not only running the said single hotel sold to assessee. Thus, by effecting the sale of single hotel does not tantamount to succession of the while business. In this regard, the reliance is placed on the decision of Gujarat High Court in the case of Premji Khimraj Shah vs ITO (118 ITR 216). The said proviso to section 32 .....

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Thus, it may please be noted that in our case, no transfer has taken place from a firm to a company nor the said business of hotel was a proprietary concern succeeded by a company. Thus the applicability of these said subsection i.e. (xiii) & (xiv) of section 47 is, therefore, totally ruled out in our case. Another provision i.e. section 170 is also not applicable to the facts of our case as the said provisions are applicable only where a business has been succeeded otherwise then on death. .....

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tion nor there is a demerger at all. Thus, our case is fully outside the purview of 51th proviso to section 32 . From the above submission, it is seen that the appellant s case neither falls in the category of succession (as provided in section 47, clauses (xiii) or (xiv) or section 170), nor amalgamation or demerger. Hence, I agree that 5th proviso to section 32 of the Act would not be attracted to the case of the appellant. 10.10 Taking into consideration, the facts that the AO had accepted th .....

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nied that the hotel business could not be carried out without the said licenses and permits. The CIT(A) further stated that 5th proviso to section 32 of the Act would not be attracted to the case of the assessee. We, therefore, do not find any reason to interfere in the order of CIT(A) in this regard . 27. The assessee in this year also has claimed the depreciation of ₹ 4,88,08,717/- on intangible asset and claimed it to be in the nature of licenses, arrangements and other business and com .....

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ing the year to the building block of assets and allowability of depreciation, this issue has already been decided by us in the appellate order for AY 2005-06, wherein, we held that, deprecation has to be allowed in full, that is, for the entire value of the FSI amount @ 10%. Once, we have directed that the depreciation has to be allowed @ 10%, then in the subsequent years same rate has to be allowed on the w.d.v. value. Thus, additional ground raised by the revenue is dismissed. 29. In the resu .....

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on intangible assets of ₹ 47,92,686 (25% of ₹ 1,91,70,744). The appellant prays that the depreciation on FSI may kindly be allowed @ 25%. Ground No.2 Without prejudice to ground no. 1, on the facts and circumstances of the case, the learned CIT(A) erred in holding that only ₹ 47,92,686 being amount spent during the AY 2005-06 for acquiring rights of FSI is to be added to the block of Buildings". The appellant prays that entire consideration towards FSI of ₹ 3,40,81, .....

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are permeating out of identical set of facts, therefore, the finding given above in the assessee s appeal for AYs 2005-06 and 2006-07 will apply mutatis mutandis in this year also. Thus, ground No.1 is treated as dismissed and ground No.2 is allowed. 32. In the result appeal of the assessee stands partly allowed. 33. In the revenue s appeal, following grounds have been raised:- 1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting the addition mad .....

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ratio laid down by the Hon'ble Supreme Court in the case of M/s. Goetze India Ltd. reported in 284 ITR 323 (SC)." "3. On the facts and in the circumstances of the case and in law, the learned CIT(A) failed to appreciate and give a finding on the applicability of ration of the Hon'ble Supreme Court's decision cited supra and relied upon by the A.O., while making disallowances u/s. 43 B of the Act." "4. On the facts and in the circumstances of the case and in law, t .....

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and in law, the Ld. CIT(A) erred in directing the assessing officer to add the amount spent on FSI during the year to the building block of asset and allow depreciation as per law" 2. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in ignoring the fact that the additional FSI is a permission to contrast additional space on plot of land and therefore, would add to the value of land by increasing the constructible area/space and has no dependent .....

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t is similar to the additional ground raised by the department in AY 2006-07, therefore, in view of our finding and direction given above, additional ground is treated as dismissed. 35. As regards ground No.4, (in the original grounds of appeal) it has been admitted by both the parties that, same is similar to the ground raised by the revenue in AY 2006- 07 and, therefore, in view of our finding given therein, which is based on the judicial precedence of the order of the Tribunal of the earlier .....

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ssee before the AO submitted that, the same should be allowed on payment basis u/s 43B, because due to inadvertent mistake, the same could not be claimed at the time of filing of the return and time for submitting the revised return has lapsed. The Ld. AO relying upon the decision of Hon ble Supreme Court in the case of M/s. Goetze India Ltd. reported in 284 ITR 323, disallowed the claim on the ground the same should have been claimed by way of revised return only. 37. The Ld. CIT(A) has allowed .....

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me Court in the case of M/s. Goetze India Ltd. (supra). However, there are no fetters on the power of the appellate authorities to entertain such a claim and this has been clarified by the Hon ble Supreme Court in the said decision itself, wherein, their Lordships have held that, it is only limited to the power of the AO and does not impinge upon the power of the Tribunal under section 254. Thus, we do not find any infirmity in the order of the CIT(A) for allowing the claim of deduction which is .....

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ing action of the AO in disallowing depreciation on intangible assets of ₹ 11,50,94,737 (25% of ₹ 46,27,949). The appellant prays that the depreciation on FSI may kindly be allowed @ 25%. Ground No.2 Without prejudice to ground no. 1, on the facts and circumstances of the case, the learned CIT(A) erred in holding that only ₹ 47,92,686 being amount spent during the AY 2005-06 for acquiring rights of FSI is to be added to the block of Buildings". The appellant prays that ent .....

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for AYs 2005-06, 2006-07 and 2007-08 and the issues involved are permeating out of identical set of facts, therefore, the finding given above in the assessee s appeal for AYs 2005-06, 2006-07 and 2007-08 will apply mutatis mutandis in this year also. Thus, ground No.1 is treated as dismissed and ground No.2 is allowed. 42. In the result appeal of the assessee stands partly allowed. 43. In revenue s appeal following grounds have raised:- 1(i) On the facts and circumstances of the case and in law .....

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s of section 43B of the I.T. Act, 1961. 2 On the facts and in the circumstances of the case and in Jaw, the Ld. CIT(A) erred in allowing depreciation on intangible assets at ₹ 2,74,54,904/-. 3 The appellant prays that the order of the CIT (A) on the above ground be set aside and that of the Assessing Officer be restored. 4. The appellant craves leave to amend or alter any ground or add a new ground which may be necessary". 44. Besides this, revenue has also raised following as additio .....

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he value of land by increasing the constructible area/space and has no dependent value without underlying land as well until and unless the additional construction is carried out by using the FSI and it is only an addition in the value of land not eligible for depreciation. "3. The appellant prays that the order of CIT(A) on the above ground be set aside and that of the Assessing Officer be restored." "4. The appellant craves leave to amend or alter any ground or add a new ground .....

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