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TMI Blog2023 (4) TMI 740X X X X Extracts X X X X X X X X Extracts X X X X ..... ad built a large customer base in Chennai - HELD THAT:- As relying judgment of Hon ble Supreme Court in CIT vs. Rajasthan Breweries Ltd. [ 2011 (11) TMI 727 - SC ORDER] of Hon ble Delhi High Court in CIT vs. Oswal Agro Mills [ 2010 (12) TMI 947 - DELHI HIGH COURT] , DCIT vs. Gujarat Narmada Valley Fertilizers Co. Ltd [ 2013 (8) TMI 300 - GUJARAT HIGH COURT] Bombay High Court judgment in DIT vs. HSBC Asset Management (I) (P) Ltd. [ 2014 (10) TMI 103 - HIGH COURT OF BOMBAY] and certain judgments of the Tribunal, it was submitted that once an asset enters into block of asset and depreciation benefit has been given in the initial year of claim the same cannot be disturbed in the subsequent years. It can be observed that the Ld. tax authorities below have disallowed the expenditure on the basis of non-production of relevant evidence with regard to nature of agreement of assessee with M/s. S.R. Minerals Water. However, the fact of allowance of the expenditure in 2003-04 is not disputed by the Revenue. Thus, the settled proposition of law that if in the initial year of claim the depreciation, is allowed, the claim cannot be disturbed in the subsequent years, has not been followed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on and accordingly, the ground is decided in favour of the assessee. Disallowance expenses incurred on Ice- Boxes - HELD THAT:- This bench is of considered opinion that the nature of expenditure on the articles once examined by Co-ordinate Bench, cannot be interfered without there being substantial basis to disagree, that not being there accordingly following the Co-ordinate Bench decision in assessee s own case for A.Y. 2002-03, the ground is decided against the assessee. - ITA No. 6605/Del/2014, ITA No. 6606/Del/2014, ITA No. 2700/Del/2015, ITA No. 2701/Del/2015, ITA No. 3902/Del/2015, ITA No. 3903/Del/2015 - - - Dated:- 12-4-2023 - Sh. N.K.Billaiya, Accountant Member And Sh. Anubhav Sharma, Judicial Member For the Assessee : Shri Neeraj Jain, Adv. Shri Aditya Vohra, Adv. Mr.ArpitGoyal, CA For the Revenue : Mohd. Gayasuddin Ansari, CIT(DR) ORDER PER ANUBHAV SHARMA, JM : The revenue and assessee are in appeal against order dated 09/10/2014, 26/03/2015, 27/03/2015 respectively for the assessment year 2004-05, 2005-06, 2006-07 2007-08 respectively passed by the CIT(A)-X, New Delhi, CIT(A)- 4, New Delhi respectively (hereinafter referred as Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sallowance on payment of processing charges. 4. At the time of argument, Ld. AR submitted that the grounds are primarily raised and adjudicated in the previous years either at the level of Tribunal or CIT(A) and detailed written submission of the same is provided.Ld. DR also admitted that the issues have been considered in the previous years and adjudicated at the two appellate levels. 5. Now taking up these issues individually for determination. 5.1 Issue no. 1 ; Disallowance of non compete fee is issue arising from the fact that assessee had acquired running businesses of various bottlers companies. Thus, restricting them from sharing their knowledge and know how in relation to the acquired business for specified period. The assessee claimed deduction for the same as deferred revenue expenditure on amortized basis over the period of non-competition. In the assessment order for assessment year 2001-02, being the first year of payment, the assessing officer disallowed the proportionate deduction on the ground that non-compete fee was capital expenditure, resulting in benefit of enduring nature, and therefore, not an allowable as revenue deduction. 5.1.1 Ld. CIT(A) had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court in CIT vs. OswalAgro Mills : 341 ITR 467 (Del), DCIT vs. Gujarat Narmada Valley Fertilizers Co. Ltd. [2014] 222 taxman 30 (Guj) Bombay High Court judgment in DIT vs. HSBC Asset Management (I) (P) Ltd. 228 taxman 365 (Bom.) and certain judgments of the Tribunal, it was submitted that once an asset enters into block of asset and depreciation benefit has been given in the initial year of claim the same cannot be disturbed in the subsequent years. 6.3 In this regard it can be observed that the Ld. tax authorities below have disallowed the expenditure on the basis of non-production of relevant evidence with regard to nature of agreement of assessee with M/s. S.R. Minerals Water. However, the fact of allowance of the expenditure in 2003-04 is not disputed by the Revenue. Thus, the settled proposition of law that if in the initial year of claim the depreciation, is allowed, the claim cannot be disturbed in the subsequent years, has not been followed by the Ld. Tax Authorities below on the basis of lack of agreement between the assesseeand M/s. S.R. Minerals Water,to examine the nature of receipt, cannot be sustained and the grounds arising out of this issue in the respective ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes, uniform etc. to school students, drought relief measures etc. Ld. AO however, considered that these expenses were not substantiated and that the same were ineligible for deduction u/s 37(1) of the Act. Ld. CIT(A) applying Explanation 2 to Section 37(1) of the Act inserted by the Finance Act, 2014, with effect from 01.04.2015 observed the same to be clarificatory in nature and made applicable to A.Y. 2004-05. In this context, it can be observed that the Raipur Tribunal Bench in the case of Jindal Power Limited ITA no. 99/BLPR/2012 and Co-ordinate Delhi Tribunal in The National Small Industries Corp. Ltd. vs. DCIT [2019] 175 ITD 601 (Del, Trib.) while relying CIT vs. Vatika Townships Pvt. Ltd. 2014, 367 ITR 466 have held that the explanation is not retrospective. These decisions of the Tribunal have been followed by Co-ordinate Bench, in case of Honda Motorcycle and Scooter India Pvt. Ltd. vs. DCIT, ITA no. 7714/Del/2017 decided on 31.08.2020. This bench is of considered opinion that there is nothing substantiates to hold a different opinion and accordingly, the ground is decided in favour of the assessee. 9. Issue no. 6. Lastly coming to the disallowance expenses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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