M/s. Bhagyodaya Transport Co., Pune V. Income-tax Officer, Ward - 2(1), Pune

ITA 2607/PUN/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 8047 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 1 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 27-11-2018
• Assessment Year: 2004-2005
• Appeal Filed On: 13-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ARISES OUT OF PASSED
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER . / ITA NO.2607/PUN/17 / ASSESSMENT YEAR : 2004-05 M/S. BHAGYODAYA TRANSPORT COMPANY, NEAR ELLORA PALACE, BALAJI NAGAR, PUNE SATARA ROAD, PUNE 411 037 PAN : AADFB4592K VS. ITO, WARD-2(1), PUNE (APPELLANT) (RESPONDENT) / ORDER PER R.S.SYAL, VP : THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDER PASS ED BY THE CIT(A) ON 11-09-2017 IN RELATION TO THE ASSESSMENT YEA R 2004- 05. 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAINST NOT ALLO WING DEPRECIATION ON GOODWILL AMOUNTING TO RS.3,95,508/-. APPELLANT BY SHRI V.L. JAIN RESPONDENT BY SHRI M.K. VERMA DATE OF HEARING 07-01-2019 DATE OF PRONOUNCEMENT 08-01-2019 ITA NO.2607/PUN/2017 M/S. BHAGYODAYA TRANSPORT COMPANY 2 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESS EE CLAIMED DEDUCTION ON ACCOUNT OF DEPRECIATION ON GOODWILL AMOUNTING TO RS.3,95,508/-. THE ASSESSING OFFICER (AO) OBSERVED THAT IT WAS FIFTH YEAR OF SUCH CLAIM. IN THE INITIAL YEAR, THE ASSESSEE CLAIMED THAT A SUM OF RS.50 LAKHS WAS PAID TOWARDS GOODWILL. THE AO OBSERVED THAT SINCE THE INCEPTION OF PARTNERSHIP FIRM NAM ELY, M/S. BHAGYODAYA TRANSPORT IN THE YEAR 1984, MR. VIKAS ME GHRAJ SETIYA AND MR. VINAY MEGHRAJ SETIYA WERE PARTNERS, WHO DECIDED TO SEPARATE FROM BUSINESS W.E.F. 01-04-1999. MR. VIKAS SETIYA TOOK OVER THE RUNNING BUSINESS OF M/S. BHAGYODAYA TRANSP ORT ALONG WITH NAME EXCLUDING MOVABLE PROPERTIES AND THE ERSTWHILE PARTNERS BALANCES AND PAID A SUM OF RS.50 LAKH TO PROPR IETORSHIP CONCERN OF ANOTHER PARTNER. IN THIS BACKDROP OF THE FAC TS, THE AO OPINED THAT RS. 50 LAKHS WAS NOT PAID MERELY FOR GOODWILL BU T THAT WAS ALSO ON ACCOUNT OF VALUABLE BUSINESS AND COMMERCIAL RIG HTS. RELYING ON THE VIEW TAKEN BY HIM IN THE PRECEDING YEARS, THE AO DID NOT ALLOW DEDUCTION ON ACCOUNT OF DEPRECIATION IN THE YEAR IN QUESTION. THE LD. CIT(A) ECHOED THE ASSESSMENT ORDER ON THIS POINT. 4. WE HAVE HEARD BOTH THE SIDES AND GONE THROUGH THE RELE VANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE ISSUE OF CLAIM O F DEPRECIATION OF GOODWILL IS A RECURRING ONE WHICH FIRSTLY CAME UP ITA NO.2607/PUN/2017 M/S. BHAGYODAYA TRANSPORT COMPANY 3 FOR CONSIDERATION BEFORE THE TRIBUNAL IN THE PRECEDING YEARS 2000- 01, 2002-03 AND 2003-04. VIDE ORDER DATED 29-08-2007 , THE TRIBUNAL HAS RESTORED THE MATTER TO THE LD. CIT(A) FOR PASSIN G A FRESH ORDER AFTER GRANTING ADEQUATE OPPORTUNITY OF BEING HE ARD TO THE ASSESSEE. THE INTERVENING A.Y. 2001-02 ALSO CAME UP FOR CONSIDERATION BEFORE THE TRIBUNAL. VIDE ORDER DATED 30-08 -2011, THE TRIBUNAL FOLLOWED THE EARLIER ORDER AND REMITTED THE MATTER TO THE LD. CIT(A). SINCE THE FACTS AND CIRCUMSTANCES OF THE IN STANT YEAR ARE MUTATIS MUTANDIS SIMILAR TO THOSE OF THE PRECEDING YEARS, RESPECTFULLY FOLLOWING THE PRECEDENT, WE ALSO SET ASIDE THE IMPUGNED ORDER ON THIS SCORE AND REMIT THE MATTER TO THE FILE OF LD. CIT(A) FOR DECIDING THE ISSUE IN THE LIGHT OF THE DECISION TAKE N BY THE TRIBUNAL FOR THE PRECEDING YEARS. 5. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 08 TH JANUARY, 2019. SD/- SD/- (VIKAS AWASTHY) (R.S.SYAL) JUDICIAL MEMBER VICE PRESID ENT PUNE; DATED : 08 TH JANUARY, 2019 ITA NO.2607/PUN/2017 M/S. BHAGYODAYA TRANSPORT COMPANY 4 / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT; 2. / THE RESPONDENT; 3. ( ) / THE CIT (APPEALS),-4, PUNE 4. 5. THE PR. CIT-3, PUNE , , SMC / DR SMC, ITAT, PUNE; 6. / GUARD FILE. // TRUE COPY // / BY ORDER, // TRUE COPY // SENIOR PRIVATE SECRETARY , / ITAT, PUNE ITA NO.2607/PUN/2017 M/S. BHAGYODAYA TRANSPORT COMPANY 5 DATE 1. DRAFT DICTATED ON 07-01-2019 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 07-01-2019 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS 7. DATE OF UPLOADING ORDER SR.PS 8. FILE SENT TO THE BENCH CLERK SR.PS 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK 10. DATE ON WHICH FILE GOES TO THE A.R. 11. DATE OF DISPATCH OF ORDER. *