DCIT, New Delhi V. M/s. Make my Trip India Pvt. Ltd, New Delhi

ITA 4087/DEL/2009

• Counselvise Citation: 408720114 RSA 2009
• Duration Of Justice: 2 year(s) 5 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 25-01-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 08-10-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S NEGI
• Assessee Lawyers: C S AGGARWAL; R P MALL
• Keywords: Capital asset; Depreciation; Rule of consistency; Revenue expenditure; Capital expenditure
• Section: 2(14); 10B; 32

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `E : NEW DELHI BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER AND SHRI K.D. RANJAN, ACCOUNTANT MEMBER I.T. A. NO.3916/DEL/2009 ASSESSMENT YEAR : 2004-05 MAKEMYTRIP (INDIA) PVT. LTD., DEPUTY COMMISSIONE R OF INCOME-TAX, 2 ND FLOOR, PLAZA CINEMA BUILDING, VS. CIRCLE-6(1), NE W DELHI. H-BLOCK, CONNAUGHT PLACE, NEW DELHI. PAN NO. AADCM5145R I.T. A. NO.4087/DEL/2009 ASSESSMENT YEAR : 2004-05 DY. COMMISSIONER OF INCOME-TAX, M/S. MAKE MY TRIP INDIA PVT. LTD., CIRCLE-6(1), NEW DELHI. VS. 75-76, ADCHINI, SIRI AURBINDO MARG, NEW DELHI. (APPELLANTS) (RESPONDE NTS) ASSESSEE BY : SHRI C.S. AGGARWAL, SR. ADVOCATE & SHRI R.P. MALL, ADVOCATE DEPARTMENT BY : SHRI R.S. NEGI, SR. DR. O R D E R PER K.D. RANJAN, ACCOUNTAT MEMBER: THESE CROSS APPEALS BY THE ASSESSEE AND REVENUE FOR ASSESSMENT YEAR 2004-05 ARISE OUT OF THE ORDER OF THE COMMISSIONER OF INCOME-TAX 2 (APPEALS)-IX, NEW DELHI. THESE APPEALS WERE HEARD TOGETHER AND FOR THE SAKE OF CONVENIENCE, ARE DISPOSED OF BY THIS CONSOL IDATED ORDER. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE AND REVENU E ARE REPRODUCED AS UNDER:- ITA NO.3916/DEL/2009 (BY THE ASSESSEE): 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN NOT ALLOWING THE DEPREC IATION ON WEBSITE DEVELOPMENT COST AS `SOFTWARE INSTEAD ALLO WING THE DEPRECATION TREATING IT AS AN INTANGIBLE ASSET UNDE R SECTION 32 OF THE INCOME-TAX ACT, 1961 (`THE ACT). 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LD. CIT(A) HAS ERRED IN NOT APPRECIATING THAT THE W EBSITE DEVELOPMENT COST QUALIFIES AS `SOFTWARE WITHIN THE MEANING OF SECTION 32 OF THE ACT READ WITH APPENDIX 1 OF THE R ULES AND ELIGIBLE FOR DEPRECIATION AT THE RATE OF 60 PERCENT . 3. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LD. CIT(A) HAS ERRED IN NOT APPRECIATING THAT EXPLA NATION 2 OF SECTION 10A(9A) OF THE ACT READ WITH NOTIFICATION N UMBER 890(E) DATED MARCH 29, 2000 ISSUED BY CENTRAL BOARD OF DIRECT TAXES, DEFINES SOFTWARE FOR THE PURPOSE OF S ECTION 10A OF THE ACT TO INCLUDE WEBSITE. 4. WITHOUT PREJUDICE TO THE ABOVE, UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A ) SHOULD HAVE ALLOWED THE DEDUCTION OF RS.1,540,000 INCURRED DURING THE YEAR ON WEBSITE DEVELOPMENT AND ITS MAINTENANCE/UPG RADATION AS REVENUE EXPENDITURE, INSTEAD OF TREATING IT AS C APITAL EXPENDITURE INSTEAD OF TREATING IT AS CAPITAL EXPEN DITURE AND ALLOWING DEPRECIATION AS INTANGIBLE ASSETS. 5. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LD. CIT(A) HAS ERRED IN NOT CONSIDERING THE JURISDI CTIONAL HIGH COURT DECISION IN THE CASE OF COMMISSIONER OF INCOM E-TAX IV 3 VS. INDIA-VISIT.COM PRIVATE LIMITED (219 CTR 603) W HEREIN THE EXPENDITURE ON WEBSITE HAVE BEEN ALLOWED AS REVENUE EXPENSES UNDER SECTION 37(1)OF THE ACT. ITA NO.4087/DEL/2009(BY REVENUE): 1. THE ORDER OF THE LEARNED CIT(APPEALS) IS ERRONE OUS & CONTRARY TO FACTS AND LAW. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(APPEALS) HAS ERRED IN DELETING THE ADDITION OF RS.24,00,777/- MADE BY ASSESSING OFFICER DISALLOWIN G THE DEPRECIATION CLAIMED ON WEBSITE DEVELOPMENT. 2.1 THE CIT(A) DID NOT APPRECIATE THE FACT THAT IN THE ASSESSMENT YEAR 2001-02 ON THE BASIS OF RELIEF HAS BEEN GRANTED, IN FACT THE ADDITION ON THIS ACCOUNT HAS B EEN CONFIRMED BY THE LD. CIT(A). 2. THE FIRST ISSUE FOR CONSIDERATION IN REVENUES A PPEAL RELATES TO NOT ALLOWING DEPRECIATION ON WEBSITE DEVELOPMENT COST A S SOFTWARE INSTEAD OF ALLOWING DEPRECIATION TREATING IT AS AN INTANGIBLE ASSET. THE FACTS OF THE CASE STATED IN BRIEF ARE THAT THE ASSESSEE CLAIMED DEPRE CIATION ON WEBSITE DEVELOPMENT EXPENSES UNDER THE BLOCK OF INTANGIBLE ASSETS. ON A QUERY TO JUSTIFY THE CLAIM, IT WAS SUBMITTED THAT WEBSITE IS AN INTANGIBLE ASSET AND IS SIMILAR IN NATURE TO KNOW-HOW, PATENTS, COPY RIGHTS , TRADE MARK, LICENCE AND FRANCHISE. THE WEBSITE IS OWNED BY THE ASSESSEE AN D IS USED FOR THE PURPOSE OF BUSINESS OR PROFESSION. THEREFORE, DEPRECIATION @ SOFTWARE IS APPLICABLE. 4 HOWEVER, THE ASSESSING OFFICER OBSERVED THAT THE EX PENDITURE INCURRED BY THE ASSESSEE ON DEVELOPMENT OF WEBSITE WAS CAPITAL IN NATURE. THE ASSESSEE HAD NOT INCURRED EXPENDITURE TOWARDS ANY ASSET WHIC H IS DEPRECIABLE UNDER THE PROVISIONS OF INCOME-TAX ACT. HE PLACED RELIAN CE ON THE DECISION IN THE CASE OF HYLAM LTD., 87 ITR 310 FOR THE PROPOSITION THAT IF THE EXPENDITURE WAS INCURRED FOR INITIAL OUTLAY OR ACQUIRING OR BRI NGING INTO EXISTENCE AN ASSET OF ENDURING NATURE FOR THE BUSINESS OF THE AS SESSEE OR FOR EXPANSION OF ASSESSEES BUSINESS OR FOR SUBSTANTIAL REPLACEMENT, IT WILL BE TREATED CAPITAL EXPENDITURE. THEREFORE, THE EXPENSES INCURRED ON DE VELOPMENT OF WEBSITE WAS CAPITAL ASSET AND DEPRECIATION CLAIMED BY THE A SSESSEE WAS DISALLOWED WHICH RESULTED IN ADDITION OF RS.24,00,777/-. 3. BEFORE THE LEARNED CIT(A) IT WAS SUBMITTED THAT THE DEPARTMENT HAD EXAMINED THE ISSUE IN ASSESSMENT YEAR 2001-02 AT LE NGTH AND HAD ALLOWED DEPRECIATION ON WEBSITE DEVELOPMENT AS AN INTANGIBL E ASSET AND NEVER CHALLENGED THE SAME IN LATER ASSESSMENT YEARS I.E. ASSESSMENT YEARS 2002-03 AND 2003-04. IT WAS ALSO SUBMITTED THAT THE AO HAD ERRED IN HOLDING THAT THE WEBSITE DEVELOPMENT DOES NOT QUALIFY AS SOFTWARE EL IGIBLE FOR DEPRECIATION @ 60% MERELY ON THE GROUND THAT THE ASSESSEE DID NO T CLAIM SO IN ITS RETURN OF INCOME. REFERRING TO THE PROVISIONS OF SEC. 32 OF THE ACT, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT INTANGIBLE ASSETS INCLUDE KNOW-HOW, 5 PATENTS, COPY RIGHTS, TRADE MARKS, LICENCE, FRANCHI SE AND ANY OTHER BUSINESS OR COMMERCIAL RIGHT OF SIMILAR NATURE. THE LEARNED AR OF THE ASSESSEE REFERRING TO THE MEANING AS PER OXFORD DICTIONARY S UBMITTED THAT WHAT INTANGIBLE MEANS UNABLE TO BE TOUCHED OR GRASPED; NOT HAVING PHYSICAL PRESENCE; DIFFICULT OR IMPOSSIBLE TO DEFINE OR UNDE RSTAND; VAGUE AND ABSTRACT. REFERRING TO AS-26 ISSUED BY THE INSTIT UTE OF CHARTERED ACCOUNTANTS OF INDIA, AN INTANGIBLE ASSET IS NEITHE R IDENTIFIABLE NOR MONETARY ASSET WITHOUT PHYSICAL SUBSTANCE, HELD FOR USE IN T HE PRODUCTION OR SUPPLY OR GOODS OR SERVICES, FOR RENTAL TO OTHERS OR FOR ADMI NISTRATIVE PURPOSES. WEBSITE IS A COLLECTION OF WEB PAGES WHICH ARE DESI GNED USING COMPUTING LANGUAGES SUCH AS HTML. AS THE WEBSITES ARE ACCESS IBLE THROUGH INTERNET ENABLE PERIPHERALS AND CANNOT BE TOUCHED OR FELT, I T FALLS WITHIN THE DEFINITION OF INTANGIBLE ASSETS. THE WEBSITE LIKE THE ONE OWN ED BY THE ASSESSEE IS PROTECTED BY SPECIFIC LEGISLATION OF KNOW-HOW, PATE NTS, COPYRIGHTS, TRADEMARKS, LICENCE AND FRANCHISES WHICH ARE ALL LE GALLY ENFORCEABLE RIGHTS. IT WAS ALSO SUBMITTED THAT THE ASSESSEE HAS USED WE BSITE FOR ITS BUSINESS AND THEREFORE, ELIGIBLE FOR DEPRECIATION AT THE RATES W HICH ARE APPLICABLE TO SOFTWARE. 4. THE LEARNED CIT(A) CONSIDERED THE SUBMISSIONS MA DE BY THE ASSESSEE. HE OBSERVED THAT THERE WAS NO DOUBT THAT THE ASSESS EE WAS INTO THE BUSINESS 6 OF TRAVEL SERVICES, CUSTOMER HANDLING AND DATA MANA GEMENT SERVICES THROUGH ITS WEBSITE WWW.MAKEMYTRIP.COM . HE FURTHER OBSERVED THAT WEBSITE IS DEFINITELY A COPYRIGHT AND THEREFORE, HE AGREED WIT H THE VIEW POINT OF THE ASSESSEE THAT THE SAME WAS TO BE CLASSIFIED AS INTA NGIBLE ASSET AND ENTITLED TO GRANT OF DEPRECIATION UNDER CLAUSE (II) OF SUB-SEC. (1) OF SECTION 32 OF THE ACT. THE ASSESSEE WAS USING THE SAID WEBSITE WHICH IS EN DURING IN NATURE, FOR ITS BUSINESS PURPOSES AND THEREFORE, HE WAS OF THE OPIN ION THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN DISALLOWING DEPRECIATI ON ON WEBSITE DEVELOPMENT COST. HE ALSO NOTED THAT AS PER THE DEFINITION OF CAPITAL ASSET GIVEN IN SEC. 2(14) OF THE ACT, IS WIDE ENOUGH TO INCLUDE PROPERT Y OF ANY KIND EXCEPT STOCK-IN-TRADE, CONSUMABLE STORES OR RAW MATERIALS HELD FOR THE PURPOSE OF BUSINESS OR PROFESSION AND PERSONAL AFFAIRS. SINCE THE WEBSITE WAS NOT FITTING INTO ANY OF THE EXCEPTIONS PROVIDED IN SEC. 2(14) O F THE ACT AND THEREFORE, THE WEBSITE WAS AN ASSET WHICH WAS REQUIRED TO BE P ROVIDED WITH AN ALLOWANCE ON ACCOUNT OF DEPRECIATION. HE ALSO OBSER VED THAT THE WEBSITE WAS USED BY THE ASSESSEE FOR THE PURPOSE OF ITS BUSINES S AND THEREFORE, DEPRECIATION WAS ALLOWABLE. THE DEPRECIATION WAS A LLOWABLE UNDER RULE 5(1A) AND APPENDIX-I OF THE INCOME-TAX RULES, 1962, @ 25% APPLICABLE TO THE INTANGIBLE ASSETS WHICH INCLUDE KNOW-HOW, PATEN TS, COPY RIGHTS, TRADE MARKS, LICENSES, FRANCHISES OR ANY OTHER BUSINESS O R COMMERCIAL RIGHTS OF 7 SIMILAR NATURE. THE LEARNED CIT(A) FURTHER NOTED TH AT IN ASSESSMENT YEAR 2001-02 THE ASSESSEE HAD CLAIMED DEPRECIATION @ 25% ON WEBSITE DEVELOPMENT COST, WHICH WAS ALLOWED BY THE AO ON TH E GROUND THAT CAPITALIZED AMOUNT OF RS.85,96,714/- ON WHICH DEPRE CIATION WAS CLAIMED, INCLUDED EXPENSES ON SALARIES, RECRUITMENT, TRAVELL ING EXPENSES ETC. AND THESE EXPENSES WERE INCURRED BEFORE THE COMMENCEMENT OF B USINESS HAVING NO RELATION TO WEBSITE DEVELOPMENT COST. THE LEARNED CIT(A) THEREFORE, CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICE R. HOWEVER, HE ALLOWED DEPRECIATION @ 25% ON WEBSITE DEVELOPMENT C OST TREATING THE SAME AS INTANGIBLE ASSET. 5. AGGRIEVED BY THE ORDER OF THE CIT(A) THE ASSESSE E IS IN APPEAL ON THE GROUND THAT DEPRECIATION ON DEVELOPMENT OF WEBSITE COST HAS NOT BEEN ALLOWED AS SOFTWARE WHEREAS THE REVENUE IS IN APPEA L ON THE GROUND THAT DEPRECATION @ 25% HAS BEEN ALLOWED TREATING THE SAM E AS INTANGIBLE ASSET. 6. BEFORE US THE LEARNED AR OF THE ASSESSEE SUBMITT ED THAT IN ASSESSMENT YEAR 2001-02 THE ASSESSEE HAD CLAIMED DEPRECIATION @ 25% ON DEVELOPMENT COST OF THE WEBSITE. FOR THE YEAR UNDER CONSIDERAT ION THE ASSESSEE CLAIMED DEPRECIATION @ 25% AT RS.24,00,777/-. IT WAS FURTH ER SUBMITTED THAT TOTAL DEPRECIATION WAS CLAIMED AT RS.35,04,023/- WHICH IN CLUDED DEPRECIATION ON WEBSITE DEVELOPMENT T @ 25%, WHICH HAS BEEN DISALLO WED BY THE ASSESSING 8 OFFICER. HE FURTHER SUBMITTED THAT AS PER OLD APPE NDIX-I APPLICABLE FOR ASSESSMENT YEARS 2003-04 TO 2005-06, INTANGIBLE ASS ETS FALL UNDER PART-B AND ARE ELIGIBLE FOR DEPRECIATION @ 25%. IN EARLIE R ASSESSMENT YEARS I.E. UPTO ASSESSMENT YEARS 2001-02 TO 2003-04 THE DEPART MENT HAS ALLOWED DEPRECIATION. THEREFORE, THE ASSESSEE IS ELIGIBLE FOR DEPRECIATION ON WEBSITE DEVELOPMENT COST. HE PLACED RELIANCE ON THE DECISI ON OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. INDIA VISIT.COM (P) LI MITED, 219 CTR 603 FOR THE PROPOSITION THAT THE EXPENDITURE INCURRED ON DE VELOPMENT OF WEBSITE WITH A VIEW TO PROVIDE A MEANS FOR DISSEMINATING TH E INFORMATION ABOUT THE ASSESSEES BUSINESS ACTIVITIES AMONGST ITS CLIENTS, IS REVENUE EXPENDITURE EVEN THOUGH RESULTING IN ENDURING BENEFIT. IN THE CASE OF ASSESSEE, DEPRECIATION HAS BEEN CLAIMED THOUGH ASSESSEE IS EN TITLED TO ENTIRE CLAIM AS REVENUE EXPENDITURE. HE ALSO PLACED RELIANCE ON TH E DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. OSWAL AGRO MILLS LTD., 238 CTR 113, FOR THE PROPOSITION THAT DEPRECIATION UNDER SE C. 32 IS ALLOWABLE ON ENTIRE BLOCK OF ASSETS IRRESPECTIVE OF THE FACT THAT A PAR TICULAR ASSET OR ASSETS OF A CLOSED UNIT WERE NOT PUT TO USE DURING THE YEAR. S INCE THE ASSET HAS BEEN USED FOR THE PURPOSE OF BUSINESS, THE ASSESSEE IS E LIGIBLE FOR DEPRECIATION. ON THE OTHER HAND, THE LEARNED SR. DR SUBMITTED THA T WEBSITE IS NOT DEPRECIABLE ASSET AND THEREFORE, DEPRECIATION CANNO T BE ALLOWED. 9 7. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. IT IS A FACT THAT THE ASSESSE E IN THE BOOKS OF ACCOUNTS HAS TREATED THE WEBSITE DEVELOPMENT COST AS SEPARATE BL OCK OF ASSETS ON WHICH DEPRECIATION @ 25% HAS BEEN CLAIMED FROM A.Y. 2001- 02 TO 2003-04. THE REVENUE HAS TREATED THE WEBSITE DEVELOPMENT COST AS BUSINESS ASSET AND HAD ALLOWED DEPRECIATION FOR ASSESSMENT YEARS 2001-02 T O 2003-04. DURING THE YEAR UNDER CONSIDERATION THE REVENUE HAS TAKEN A CO NTRARY VIEW THAT WEBSITE IS NOT A DEPRECIABLE ASSET AND HAS DISALLOWED DEPRE CIATION CLAIMED BY THE ASSESSEE AT RS.24,00,777/-. THE LEARNED CIT(A) FOL LOWING THE PRINCIPLE OF CONSISTENCY HAS ALLOWED DEPRECIATION @ 25%. THE AS SESSEE IS IN THE BUSINESS OF TOUR AND TRAVEL AND FOR THE PURPOSE OF ITS BUSINESS, HAS DEVELOPED A WEBSITE ON WHICH INFORMATION ABOUT THE ASSESSEE I S AVAILABLE. THE ASSESSEE IS ALSO DOING BUSINESS THROUGH ITS WEBSITE AND THER EFORE, THE WEBSITE DEVELOPMENT COST REPRESENTS BUSINESS ASSET FALLING UNDER THE BLOCK OF INTANGIBLE ASSETS. THEREFORE, THE LEARNED CIT(A), IN OUR CONSIDERED OPINION, HAS RIGHTLY ALLOWED DEPRECIATION @ 25% TREATING THE WEBSITE AS BUSINESS ASSET. ACCORDINGLY, WE DO NOT FIND ANY INFIRMITY I N THE ORDER PASSED BY THE LEARNED CIT(A) ALLOWING THE RELIEF TO THE ASSESSEE. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. 10 9. NOW COMING TO THE ISSUE RAISED BY THE ASSESSEE I N GROUND NOS. 1 TO 3 WHICH RELATES TO TREATING THE WEBSITE AS SOFTWARE. FOR THIS PURPOSE, THE ASSESSEE HAS PLACED RELIANCE ON CENTRAL BOARD OF DI RECT TAXES NOTIFICATION NO. 890(E) DATED 26.09.2000. THE SAID NOTIFICATION HAS BEEN ISSUED UNDER CLAUSE (B) OF ITEM (I) OF EXPLANATION 2 TO SECTION 10A, CLAUSE (B) OF ITEM (I) OF EXPLANATION 2 OF SECTION 10B AND CLAUSE (B) OF E XPLANATION TO SECTION 80HHE OF THE INCOME-TAX ACT, 1961. THE SAID NOTIFI CATION HAS BEEN ISSUED FOR THE PURPOSES OF SECTIONS 10A, 10B AND 80HHE, WH ICH HAS BEEN NOTED BY THE BOARD. FOR THE PURPOSE OF THESE SECTIONS, WEBS ITE SERVICES ARE INCLUDED IN THE COMPUTER SOFTWARE. NOTIFIED DEFINITION FOR THE PURPOSES OF SECTIONS 10A, 10B AND 80HHE IS FOR THE SPECIFIC PURPOSE OF T HOSE SECTIONS AND CANNOT BE IMPORTED FOR THE PURPOSES OF DEPRECATION UNDER SEC. 32 OR OLD APPENDIX-I APPLICABLE FOR ASSESSMENT YEARS 2003-04 TO 2005-06. MOREOVER, WEBSITE CANNOT BE TREATED AS SOFTWARE. W EBSITE ENABLES COMPANIES TO DO WHAT THE PRINTED BROCHURES DID BUT, IN A MUCH MORE EFFICIENT MANNER AS WELL AS IN A MUCH SHORTER PERIO D OF TIME AND COVERING A MUCH LARGER SET OF PEOPLE WORLDWIDE. BY APPROACHIN G WEBSITE OF THE ASSESSEE, THE CUSTOMERS/PEOPLE CAN APPROACH THE ASS ESSEE AND CONDUCT BUSINESS. THEREFORE, THE WEBSITE AS SUCH CANNOT BE TREATED AS SOFTWARE. IT WOULD FALL UNDER THE DEFINITION OF INTANGIBLE ASSET ON WHICH DEPRECIATION @ 11 25% IS ALLOWABLE. THEREFORE, IN OUR CONSIDERED OPI NION, THE LEARNED CIT(A) WAS JUSTIFIED IN ALLOWING THE DEPRECIATION @ 25% AN D NOT @ 60% AS APPLICABLE TO SOFTWARE. IN VIEW OF ABOVE, GROUND N O.1 TO 3 ARE DISMISSED. 10. IN GROUND NO.4 THE ASSESSEE HAD CLAIMED AMOUNT OF RS.15,40,000/- INCURRED DURING THE YEAR ON WEBSITE DEVELOPMENT AS REVENUE EXPENDITURE RELYING ON THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF INDIA VISIT.COM (P) LTD. (SUPRA). THE ASSESSEE HAS TREAT ED THE SOFTWARE DEVELOPMENT EXPENDITURE FROM VERY BEGINNING AS BUSI NESS ASSET AND HAS CLAIMED THE SAME AS BLOCK OF ASSETS ON WHICH DEPREC IATION @ 25% WAS CLAIMED AND ALLOWED BY THE ASSESSING OFFICER UPTO A SSESSMENT YEAR 2003- 04. IN THE ASSESSMENT YEAR 2004-05 ALSO THIS AMOUN T HAS BEEN TAKEN AS PART OF BUSINESS ASSET AND THE ASSESSEE HAD CLAIMED THE SAME AS BLOCK OF ASSETS ADDED DURING THE YEAR UNDER CONSIDERATION. SINCE T HE ASSESSEE ITSELF HAS CLAIMED THE WEBSITE DEVELOPMENT EXPENSES AS PART OF BLOCK OF ASSETS ON WHICH DEPRECIATION ELIGIBLE TO INTANGIBLE ASSETS HA S BEEN CLAIMED AND ALLOWED, THE SAME CANNOT BE TREATED AS REVENUE EXPE NDITURE. THE SAME TREATMENT HAS BEEN GIVEN IN EARLIER YEARS. MOREOVE R, ON PERUSAL OF GROUNDS OF APPEAL BEFORE THE CIT(A), WE FIND THAT THE ASSES SEE HAS NOT TAKEN THIS GROUND BEFORE THE CIT(A) NOR ANY CLAIM OF REVENUE E XPENDITURE WAS MADE BEFORE THE CIT(A). THEREFORE, THIS GROUND OF APPEA L DOES NOT ARISE FROM THE 12 ORDER OF THE CIT(A) AND THEREFORE, THE SAME DESERVE S TO BE DISMISSED. WE ORDER ACCORDINGLY. 11. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. 12. TO SUM UP, THE APPEALS FILED BY THE REVENUE AS WELL AS ASSESSEE ARE DISMISSED. 13. THIS DECISION IS PRONOUNCED IN THE OPEN COURT O N 9 TH MARCH, 2012. SD/- SD/- (R.P. TOLANI) (K.D. RANJAN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 9 TH MARCH, 2012. COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR, ITAT.