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TMI Blog2013 (11) TMI 186X X X X Extracts X X X X X X X X Extracts X X X X ..... way of making payment over and above the Net Asset value & that the Goodwill was intrinsically linked with transfer of business operations. 3. The learned officer has erred in not appreciating that the appellant had in fact paid a sum of Rs. 16,58,76,000 towards Goodwill which represented the excess of Net Asset Value of the Seller Company. As part of slump sale agreement, the appellant had paid a total sum of Rs. 44.7 crores as Purchase Consideration split between NAV of Rs. 28.11 crores and balance of Rs.16.59 crores towards Goodwill. 4. The learned officer has erred in ignoring the submissions of the appellant that as part of business transfer there were certain other intangible assets that were acquired viz., knowhow, employees, business information, business records etc. 5. The appellant craves leave to add, withdraw, amend or forego any or all of the above grounds of appeal during the appellate proceedings." 3. Brief facts of the case are that the assessee, formerly known as Areva T & D Systems India Ltd merged with Areva T & D India Limited, had filed its 'return' of income on 27.11.2006 disclosing loss of Rs.97,06,238/-. On 31.03. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee's appeal, the Hon'ble Delhi High Court has accepted its plea as under: "13. In the present case, applying the principle of ejusdem generis, which provides that where there are general words following particular and specific words, the meaning of the latter words shall be confined to things of the same kind, as specified for interpreting the expression "business or commercial rights of similar nature" specified in Section 32(1)(ii) of the Act, it is seen that such rights need not answer the description of "knowhow, patents, trademarks, licenses or franchises" but must be of similar nature as the specified assets. On a perusal of the meaning of the categories of specific intangible assets referred in Section 32(1)(ii) of the Act preceding the term "business or commercial rights of similar nature", it is seen that the aforesaid intangible assets are not of the same kind and are clearly distinct from one another. The fact that after the specified intangible assets the words "business or commercial rights of similar nature" have been additionally used, clearly demonstrates that the Legislature did not intend to provide for depreciation only in respect of specified intan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bstantial question of law is decided in the affirmative and this appeal is allowed in favour of the assessee and against the Revenue and the impugned order is set aside." Taking cue from the same and more so, in the absence of any distinguishing features pointed out by the Revenue, we are of the view that the assessee's claim of depreciation raised in the assessment, which was declined by the Assessing Officer as well as CIT(A), deserves to be accepted. Therefore, we allow assessee's appeal and delete the disallowance in question. I.T.A. NO. 1213/Mds/2010 8. In this appeal, the grievance of the assessee has been pleaded as herein below: "1. The learned Commissioner has erred in disallowing the Provision for Liquidated damages amounting to Rs. 18,92,000/-. 2. The learned officer has erred in not following his own order of the immediately preceding year, where he has allowed this claim in full after giving detailed reasons for doing so. 3. The learned officer has erred in disallowing 50% of the sum of Rs. 75,34,297 representing the share of expenses pooled and shared by all AREVA units towards Information technology & Marketing support act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ggrieved, assessee carried the matter in appeal. We find that the CIT(A) has upheld Assessing Officer's finding qua warranty provision by observing as under: "5.13 I have reproduced the written submission of the assessee which is brief and précised and can be understood clearly. The AR of the assessee has relied on the recent decision of the Supreme Court in the case of Rotorks Controls India (P)Ltd. 314 ITR 0062(SC) where the Hon'ble apex court has held that if provision for warranty is a part of sales contract and is maintained scientifically and based on past data of sales and year-wise warranties claimed by the customers in a systematic manner than provision for warranty will be allowed as ascertained liability. The assessee is a part of multinational company of France origin and having a team of good HRD engineers in managing the production, sales of transmission equipments of electrical engineering, consisting of high voltage power transmission equipments. Therefore, the provision for warranty claimed by the assessee in its revised return is allowed after the decision of the apex court in the above cited case of M/s Rotorks Controls India (P)Ltd. & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure claimed by the assessee of Rs.75,34,297/-(Rs.63,84,547 + 11,49,750/-) as capital expenditure. The AO is directed to verify the above expenditure of the assessee and allow expenditure as per law accordingly." In this manner, the assessee is aggrieved and it is in appeal. 12. In the course of hearing, the assessee has vehemently argued that the CIT(A) has wrongly upheld the findings of the Assessing Officer qua the warranty provision as well as expenses claimed. Therefore, by drawing our attention to the findings above said, it prays for acceptance of appeal. 13. Opposing this, the Revenue has submitted that the CIT(A) has rightly confirmed the findings of the Assessing Officer. 14. We have given our thoughtful consideration to the rival contentions raised by the parties and also gone through the orders of lower authorities. Coming to disallowance of warranty provision above said, we find that reasoning adopted by the Assessing Officer as well as CIT(A) is that the assessee has only followed approximation method instead of taking into consideration the liquidated damages as claimed by the concerned parties. In appeal, the CIT(A) also holds that only liquidated damages and act ..... X X X X Extracts X X X X X X X X Extracts X X X X
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