B.Raveendran Pillai, Kollam V. ACIT, Kollam

ITA 521/COCH/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4571 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2011
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 03-11-2009
• Court: TRIBUNAL
• Department Lawyers: T J VINCENT
• Assessee Lawyers: A S NARAYANAMOORTHY CAAR
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLAT E TRIBUNAL COCHIN BEN CH, COCHIN BEFORE S/SHRI N.VIJAYAKUMARAN, JM AND SANJAY AR ORA, AM I.T.A. NO. 520 & 521/COCH/2009 ASSESSMENT YEAR: 2003-04 & 2006-07 SHRI B. RAVEENDRAN PILLAI, SREEVALSAM, THEVALLY KOLLAM. [PAN: AFTPP 9316G] VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-1(1), KOLLAM. (ASSESSEE -APPELLANT) (REVENUE- RESPONDENT) ASSESSEE BY SHRI A.S.NARAYANAMOORTHY, CA-AR REVENUE BY SHRI T.J.VINCENT, DR O R D E R PER SANJAY ARORA, AM: THESE ARE A SET OF TWO APPEALS BY THE ASSESSEE FOR THE ASSESSMENT YEARS (A.YS.) 2003-04 AND 2006-07, CHALLENGING THE CONFIRMATION O F DISALLOWANCE OF DEPRECIATION ON INTANGIBLE ASSETS U/S. 32(1)(II) OF THE INCOME TAX ACT, 1961 (THE 'ACT' HEREINAFTER) BY THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, TRIVANDRUM (CIT(A) FOR SHORT) VIDE HER COMMON ORDER DATED 27.8.2009. 2 THE ASSESSEE IS AN INDIVIDUAL, WHO, IN THE COMPUTATION OF HIS TAXABLE INCOME FOR THE RELEVANT YEARS CLAIMED DEPRECIATION ON GOOD-WILL, W HICH STOOD ACQUIRED BY HIM AT A COST OF ` 200 LACS, ALONG WITH OTHER MOVABLE ASSETS, VIDE SAL E DEED DATED 18.3.1999. THE AUTHORITIES BELOW REJECTED THE ASSESSEES CLAIM ON THE GROUND THAT GOOD-WILL IS NOT AMONG THE INTANGIBLE ASSETS UNDER THE RELEVANT PROVISION, ALSO QUESTIONING THE BASIS OF ITS VALUATION AS WELL AS THE USER OF THE SAME, I.E., IN COMMERCIAL TERMS. THE LD. CIT(A) FURTHER RELIED ON THE DECISION BY THE TRIBUNAL IN T HE ASSESSEES OWN CASE FOR AY 2004-05 (IN I.T.A. NO. 613/COCH/2008 DATED 23.4.2009/COPY O N RECORD). THE LD. AR, THE ASSESSEES COUNSEL, WOULD SUBMIT THAT THE DECISION BY THE TRIBUNAL IN THE ASSESSEES OWN CASE FOR A.Y. 2004-05 (SUPRA) STANDS REVERSED BY TH E HONBLE JURISDICTIONAL HIGH COURT, FURNISHING THE COPY OF THE RELEVANT JUDGMENT (IN I. T.A. NO. 1741/2009 DATED 23.9.2010). ITA NOS. 520 & 521/COCH/2009 2 IN VIEW THEREOF, THE ASSESSEES CASE IS MAINTAINABL E FOR THE YEARS UNDER REFERENCE AS WELL. THE LD. DR, ON THE OTHER HAND, COULD NOT FURNISH AN Y MATERIAL OR REASON, DISTINGUISHING THE ASSESSEES CASE FOR THE CURRENT YEAR(S), IN THE ABSENCE OF WHICH THE DECISION BY THE HONBLE JURISDICTIONAL HIGH COURT HAS A BINDING EFF ECT ON THE TRIBUNAL. 3. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATERIAL ON RECORD, INCLUDING THE CASE LAW RELIED UPON. THE FACTS OF THE CASE, WHICH ARE T HE SAME FOR BOTH THE YEARS, ARE NOT IN DISPUTE, WHICH RELATES ONLY TO THE EXIGIBILITY TO D EPRECIATION ALLOWANCE U/S. 32(1)(II) OF THE ACT ON THE `GOODWILL ACQUIRED BY THE ASSESSEE IN M ARCH, 1999. THE SAID QUESTION HAS BEEN ANSWERED BY THE HONBLE JURISDICTIONAL HIGH CO URT IN THE AFFIRMATIVE. UNDER THE CIRCUMSTANCES, WE FIND NO REASON NOT TO ACCEPT THE ASSESSEES CLAIM, AND RESPECTFULLY FOLLOWING THE DECISION BY THE HONBLE JURISDICTIONA L HIGH COURT, DIRECT THE ALLOWANCE OF THE ASSESSEES CLAIM FOR THE RELEVANT YEARS. THE QUESTI ON OF VALUATION WOULD ALSO NOT SURVIVE THE SAID DECISION BY THE HONBLE COURT, AS IT IS TH E SAME GOODWILL ACQUIRED BY THE ASSESSEE IN THE YEAR 1999 ON WHICH THE DEPRECIATION IS BEING CLAIMED FROM YEAR TO YEAR. AS SUCH, WHEN NO ISSUE AS REGARDS VALUATION OBTAINS FOR AY 2 004-05, THE SAME COULD NOT FOR THE RELEVANT YEARS AS WELL; THE DEPRECIATION ALLOWANCE UNDER THE ACT BEING ONLY ON THE BASIS OF THE `WRITTEN DOWN VALUE. WE DECIDE ACCORDINGLY. 4. IN THE RESULT, THE ASSESSEES APPEALS ARE ALLOWE D. SD/- SD/- (N.VIJAYAKUMARAN) (SANJAY ARORA) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: ERNAKULAM DATED: 29TH APRIL, 2011 GJ COPY TO: 1. SHRI B.RAVEENDRAN PILLAI, SREEVALSAM, THEVALLY, KOLLAM. 2. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE -1(1), KOLLAM. 3. THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, TRIV ANDRUM 4. THE COMMISSIONER OF INCOME-TAX, TRIVANDRUM. 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER ITA NOS. 520 & 521/COCH/2009 3