2021 (3) TMI 986 - AT - Income Tax

Non adjudication of the additional ground raised by the assessee - Allowability of depreciation on non-compete fees - additional ground in assessee s appeal which the ITAT has not adjudicated - HELD THAT - Miscellaneous Application there is no whisper of additional ground remaining un-adjudicated. We note that additional ground was not adjudicated by the ITAT as there was no discussion on the subject. However since the assessee has submitted photocopy of the ITAT receipt for filing additional ground in the interest of justice we deem it appropriate that appeal 2020 (3) TMI 416 - ITAT MUMBAI be recalled only to consider the veracity and adjudication of the said additional ground raised by the assessee.

Summary

Issues involved:
Rectification of mistake apparent from record in ITA No. 570 & 711/Mum/2018 regarding allowability of depreciation on non-compete fees paid by the assessee.

Analysis:
The assessee filed a Miscellaneous Application seeking rectification of a mistake apparent from the record in ITA No. 570 & 711/Mum/2018 related to the allowability of depreciation on non-compete fees paid. The ITAT had dismissed the Revenue's appeal against the order of the learned CIT(A), noting conflicting decisions from different High Courts. The ITAT upheld the CIT(A)'s order based on the judgment of the Hon'ble Supreme Court in the case of Vegetable Products Ltd. The assessee contended that the ITAT erred in not considering the judgment of the Hon'ble Jurisdictional High Court in the case of Principal CIT Vs. Piramal Glass Limited, where depreciation for non-compete fees was allowed. Citing relevant Supreme Court decisions, the assessee argued that the ITAT's order contained mistakes and should be recalled.

Upon hearing both counsels and reviewing the records, a query was raised regarding the grounds in the ITAT's order related to amortization/depreciation for non-compete fees. The ITAT had upheld the CIT(A)'s order in the Revenue's appeal but had not adjudicated an additional ground raised by the assessee in their appeal. The assessee pointed out that they had submitted an additional ground in an application, seeking depreciation for non-compete fees under section 32 of the I.T. Act. Despite no mention of the additional ground in the Miscellaneous Application, the ITAT decided to recall ITA No. 570/Mum/2018 to consider the veracity and adjudication of the said additional ground raised by the assessee.

In conclusion, the ITAT recalled ITA No. 570/Mum/2018 solely to consider the claim made by the assessee regarding the additional ground that was not adjudicated previously. The Miscellaneous Application was allowed accordingly on 8.3.2021.