ACIT, Circle-8(1), New Delhi V. Eltek SGS Pvt. Ltd, New Delhi

ITA 7281/DEL/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6448 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 15-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR MANINDER KAUR
• Keywords: Depreciation; Scheme of amalgamation
• Section: 201; 32

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B, NEW DELHI BEFORE SH. N. K. BILLAIYA, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER (THROUGH VIDEO CONFERENCING) ITA NO.7281 & 7282/DEL/2018 ASSESSMENT YEAR: 2013-14 & 201 4-15 ACIT CIRCLE 8 (1) NEW DELHI VS ELTEK SGS PVT. LTD. B-17, MAHARANI BAGH, NEW DELHI PAN NO. AAACE2920L (APPELLANT) (RESPONDENT) APPELLANT BY DR. MANINDER KAUR, SR DR RESPONDENT BY SH. ANIL BHALLA, CA DATE OF HEARING: 08/09/2021 DATE OF PRONOUNCEMENT: 08/09/2021 ORDER PER N. K. BILLAIYA, AM: ITA NO.7281/DEL/2018 AND 7282/DEL/2018 ARE TWO APP EALS BY THE REVENUE PREFERRED AGAINST TWO SEPARATE ORDER S OF THE CIT(A)-3, DELHI DATED 03.08.2018. 2. BOTH THESE APPEALS WERE HEARD TOGETHER AND ARE D ISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 3. THE COMMON GRIEVANCE IN BOTH THESE APPEALS RELAT E TO THE DELETION OF ADDITION MADE BY THE AO ON ACCOUNT OF D ISALLOWANCE OF DEPRECIATION ON GOODWILL. 2 4. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT T HE APPELLANT COMPANY UNDERWENT AMALGAMATION WITH M/S. VALERE POW ER INDIA LIMITED PURSUANT TO THE ORDER OF HIGH COURT DATED 0 5.02.2014 BY WHICH THE AMALGAMATION WAS EFFECTED FROM 01.04.2011 . 5. AS PER THE SCHEME OF AMALGAMATION, WHERE VALUE O F LIABILITIES AND AMOUNT OF EQUITY CAPITAL ALLOTTED / PAYMENT TO THE EQUITY SHAREHOLDERS EXCEEDS THE VALUE OF ASSETS OF THE TRANSFEROR COMPANY TAKEN OVER, SUCH EXCESS SHALL DEBITED TO TH E GOODWILL ACCOUNT. ACCORDINGLY, THE ASSESSEE CLAIMED ON DEPR ECIATION ON GOODWILL WHICH CLAIM WAS DENIED BY THE AO. 6. ASSESSEE ASSAILED THE ADDITION BEFORE THE CIT(A) AND REITERATED ITS CLAIM OF DEPRECIATION STRONGLY CONTE NDED THAT THE GOODWILL HAS ENUMERATED FROM THE DECISION OF THE HO NBLE HIGH COURT AND NOT OUT OF ACCOUNTING PRINCIPLES. IT WAS BROUGHT TO THE NOTICE OF THE CIT(A) THAT GOODWILL BEING A NON TANG IBLE ASSETS IS ELIGIBLE FOR DEPRECIATION U/S. 32 OF THE ACT. 7. THE CIT(A) WAS CONVINCED WITH THE CLAIM AND ALLO WED THE DEPRECIATION. 8. BEFORE US THE DR STRONGLY SUPPORTED THE ASSESSME NT ORDER. 9. WE FIND THAT THIS CLAIM IS NO MORE RES-INTEGRA A S THE ISSUE HAS BEEN SETTLED IN FAVOUR OF THE ASSESSEE AND AGAI NST THE REVENUE BY THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SMIFS SECURITIES LTD. 348 ITR 302. WE DO NOT FIND ANY ER ROR OR INFIRMITY IN THE FINDINGS OF THE CIT(A). 10. IN THE RESULT, BOTH THE APPEALS FILED BY THE RE VENUE ARE DISMISSED. 3 11. DECISION ANNOUNCED IN THE OPEN COURT IN THE PRE SENCE OF BOTH THE REPRESENTATIVES ON 08.09.2021. SD/- SD/- (SUCHITRA KAMBLE) (N. K. BILLAIYA) JUDICIAL MEMBER ACCO UNTANT MEMBER *NEHA* DATE:-08.09.2021 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGI STRAR ITAT NEW DELHI DATE OF DICTATION 0 8 .09.2021 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 0 8 .09.2021 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 0 8 .09.2021 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS/PS 0 8 .09.2021 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 0 8 .09.2021 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/ PS 0 8 .09.2021 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 0 8 .09.2021 DATE ON WHI CH THE FILE GOES TO THE BENCH CLERK 0 8 .09.2021 DATE ON WHICH FILE GOES TO THE HEAD CLERK. THE DATE ON WHICH FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER