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TMI Blog2025 (2) TMI 513X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal has not dealt with the merits of the matter, the same cannot be considered as an information, so as to assume the jurisdiction to issue the notice u/s 148 of the Act more particularly when the AO has failed to point out the effect of deletion of the addition made in the year 2014-15 and therefore, there is no question of escapement of income for the AY 2018-19 for claim of the depreciation on the Written Down value of the goodwill for the year under consideration.
The impugned order as well as the notice issued u/s 148 of the Act are hereby quashed and set aside. Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... ermining total assessed income of Rs.58,23,80,090/- after making addition of Rs. 2,41,03,000/- on account of disallowance of 'royalty expenses' u/s. 37 and 'donation' u/s. 35 (1) (ii) of IT Act. On perusal of the financial statements and tax audit report of the assessee, it was seen that assessee had shown intangible asset worth Rs.53,17,57,633/- on which 25% depreciation i.e. Rs. 13,29,39,408/- had been claimed while computing the total income. On perusing case records of the assessee, it was observed that the said intangible asset had been created by the assessee company during F.Y. 2013-14 on acquired of Gujarat Apollo Industries Ltd. On verification of the case record in the case of the assessee company, it is seen th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee company is only to the extent it is recorded in the books of M/s Gujarat Apollo Industries Ltd (GAIL) before acquisition which is in complete contradiction with the recording of goodwill worth Rs. 1,16,32,60,681/- by the assessee company. Hence the claim of depreciation by the assessee is clearly in violation of the explicit provisions of I.T. Act. Please justify/explain the above transactions/Investment/income alongwith supporting documentary evidences. Failure to which it is presume that you have nothing to say about the above-mentioned financial transactions and the same will be treated as escapement of income liable to be added in your total income. On the basis of the information flagged in the case of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade on the basis of the order of the Dispute Resolution Panel. The Assessing Officer while passing the impugned order has observed as under :- "8. The reply filed by the assessee is not acceptable. The assessee has submitted that during the year under consideration AIPL has claimed depreciation amounting to Rs. 9,20,15,737/- (Instead of Rs. 13,29,39,408/- mentioned in the notice) on intangible asset being goodwill arising on business acquisition of GAIL and AEML. The written down value of Rs. 53,17,57,633/- is closing written down value of the goodwill as well as other intangible assets (i.e., value as on 31 March 2016). Accordingly, during the year under consideration the depreciation claimed by AIPL is Rs. 9,20,15,737/- instead of depre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 provides that the notice under section 148 of the Act can be issued beyond a period of three years but within ten years from the end of the relevant AY only if the specified conditions are satisfied. 12. On perusal of the financial statements and tax audit report of the assessee, it was seen that assessee had shown intangible asset worth Rs. 53,17,57,633/- on which 25% depreciation i.e. Rs. 13,29,39,408/- had been claimed while computing the total income. The said intangible asset had been created by the assessee company during F.Y. 2013-14 on acquired of Gujarat Apollo Industries Ltd. The TPO had made upward adjustment of Rs. 116.32 Cr. in A.Y. 2014-15. Thereupon, the assessee objected before the Dispute Resolution Penal (DRP) and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee. 16. In view of the above, as per the provision of section 148A(d) of the Act, after considering the material available on record and reply of the assessee, it is clear that income chargeable to tax to the extent of Rs. 13,29,39,408/- has escaped assessment within the meaning of section 147 of the I.T. Act for A.Y.2018-19 represented in the form of entries in books of accounts as per the provision of section 149 (1) (b) of the Act. 17. Therefore, it is a fit case to issue notice u/s.148 of the Act. This order is being passed under section 148A (d) of the Act with prior approval of specified authority as defined under section 151 of the Act for the A.Y. 2018-19. 7. On perusal of the aforesaid order, it is clear that the respond ..... X X X X Extracts X X X X X X X X Extracts X X X X
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