TMI Blog2017 (11) TMI 1215X X X X Extracts X X X X X X X X Extracts X X X X ..... he revenue requiring c-filing did not have the mechanism of uploading the return it a particular column is not filled. This reason has not been controverted by the revenue till today. It was under these circumstances that the assessee was compelled to fill a wrong date which was subsequently rectified in the revised return along with the actual date of audit along with other reasons mentioned by the assessee for revising the return. In the light of these facts it cannot be said that the issue of validity of revised return has not been examined by the AO in the course of the assessment proceedings. The AO had raised a specific query which was followed by a detailed response of the assessee and since same was accepted after due application of mind same did not find place in the assessment order. Therefore in our view the jurisdiction exercised by the CIT on the issue of validity of revised return cannot be upheld. In view of above, the CIT was not justified in exercising jurisdiction under section 263 of the Act on this issue. Goodwill acquired should be apportioned between the appellant and the international affiliates of the appellant - Held that:- The Hon’ble Delhi High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d a purported revised return declaring total loss of (-) ₹ 62,71,22,057/-. As per section 139(5) of the Act, if any person having furnished a return under sub section (1) discovers any omission or wrong statement therein . The Assessing Officer failed to seek any explanation with regard to the to appreciate that the subsequent return may not qualify as a revised return. During transportation services and express delivery undertaking of AFL Pvt. and transportation services undertaking of Unifreight India Pvt. Ltd. as a going concern on slump sale basis. The assessee has shown goodwill amounting to ₹ 3,96,00,68,730/- in the audited statement and has claimed depreciation thereon of ₹ 52,28,95,318/-. In Form No.3 CD is ₹ 3,21,29,204/- the addition made to fixed Annexure 2 of Form No.3CD. On the additions made under various block of assets during the year, the depreciation determined to be allowed in Form No.3 CD is ₹ 3,21,29,204/-. The Assessing Officer has completely failed to make any manner in which it had been valued, the admissibility of non-compete fees as when such claim is at variance with the depreciation computed in Form No.3CD. income. Therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsideration paid and tangible assets acquired on account of purchase of business from AFL and UFL. The goodwill figure was arrived at as stated herein and was certified by the auditors in the audited accounts read with the valuer s report. Therefore, the difference between the loss claimed in the original return of income and the revised return of income is on account of claim in respect of depreciation on goodwill. In the audited accounts, the auditor recorded the goodwill under the head intangible assets at ₹ 396 crores but did not claim depreciation on the same. The said figure of ₹ 396 crores is arrived at based on the valuer s report and ₹ 397 crores i.e. ₹ 1 Crore is on account of post closing adjustments. The learned AR submitted that AO has made a specific query regarding revising the income and assessee has filed the reply. In the original assessment order AO has examined and accepted the return after taking consideration the said revised return of income. Therefore, the order is not erroneous and prejudicial to the interest of the revenue. The learned AR submitted that as per section 139C, 139D and Rule 12(2) of the IT Rules read with circular no.9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, in the subsequent year, based on the decision of Hon ble Supreme Court in the case of Summit Securities Ltd. (supra) has certified the claim of depreciation on goodwill. Therefore, this judgment is not applicable. In respect of non compete fee, the Ld. A.R. relied upon the decision of CIT vs. Andhra Fuels (P) Ltd. 70 Taxman 271 and ACIT vs. Clariant Chemicals (I) Ltd. 53 taxman 284. 9. We have heard the rival contention of both the parties. We have perused the paper book filed by the assessee based and case laws filed by the assessee. The assessee and revenue has filed the brief written submission which we have passed. 10. We propose to deal with ground no.1 while dealing with other 3 grounds. 11. We now take up ground no.2 which primarily deals with the findings of the CIT and the directions issued by the CIT to treat return filed under section 139(1) as invalid and therefore cannot be revised under section 139(5) of the Act. The CIT has dealt with this issue in his order at pg 9 onwards. The CIT has exercised his jurisdiction on the ground that the issue of validity of return and the revised return has not been examined by the AO and therefore the assessment order was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which was subsequently rectified in the revised return along with the actual date of audit along with other reasons mentioned by the assessee for revising the return. In the light of these facts it cannot be said that the issue of validity of revised return has not been examined by the AO in the course of the assessment proceedings. The AO had raised a specific query which was followed by a detailed response of the assessee and since same was accepted after due application of mind same did not find place in the assessment order. The assessee has relied upon the decision of the Delhi Tribunal in the case of Escorts and Jaipur Tribunal in the case of Pratap Rajasthan Special Steels Ltd. in its submissions. The said 2 decisions state that original return can be filed based on unaudited accounts and such a return can later on be revised after getting the accounts audited. The decision relied upon by the Revenue in the case oll-Timachal Pradesh State Forest Corporation reported in 231 ITR 556 and Gauhati High Court decision in case of Sunanda Ram Deka 210 ITR 988 are distinguishable on facts. The said 2 decisions did not deal with e-filing of return and furthermore the assessee in those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relationship between parent and subsidiary and its economic independence. The Hon'ble Supreme Court has categorically stated that parent and subsidiary are totally independent tax payers and they are subjected to income tax on standalone basis irrespective of their actual degree of economic independence and regardless of whether profits are reserved or distributed to shareholders. 13. The Hon ble Delhi High Court in the case of Maruti Suzuki reported in 381 ITR 117 while dealing with transfer pricing adjustment on AMP expenses incurred by Indian company has negative the contention that such expenses, in the absence of any understanding with AE empower the revenue to make adjustment. It is also important to note that if there are any transactions between the assessee and its affiliates that would be a subject matter of transfer pricing regulation. In our view, the CIT was not justified in giving a direction for apportionment of goodwill and the said direction is without any material or any basis and therefore the directions given by the CIT on apportionment of goodwill between the assessee company and its affiliates are contrary to law and hence such a finding is quashed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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