VIACOM 18, MEDIA PVT LTD ,MUMBAI vs. PCIT-8, MUMBAI
Income Tax Appellate Tribunal, MUMBAI BENCH “F” MUMBAI
Before: SHRI OM PRAKASH KANT () & SHRI RAJ KUMAR CHAUHAN () Assessment Year: 2019-2020
PER OM PRAKASH KANT, AM This appeal by the assessee is directed against revisional order dated 18/03/2025 passed by the learned Principal Commissioner of Income-tax, Mumbai-8 [in short ‘the learned PCIT’] under section 263 of Income-tax Act, 1961 (in short ‘the Act’) wherein he set aside the assessment order passed by the faceless assessment unit (in short ‘the Assessing Officer’) holding it to be erroneous insofar as prejudicial to the inte assessee in its appea On the facts a learned Princi Order under s bad in law 1. erred in inv Income Tax assessment o ('NeAC') ('As prejudicial to 2. failed to a after verificat and applica depreciation o 3. failed to ap supported by Section 32 of Without preju Disallowance 4. erred in di ('AO') to verify as consistentl 5. failed to ap Section 32 of and upto AY 2 6. without pre total amount Amount of R goodwill on m to goodwill on Rs. 7,55,90,1 is an intangib Short-grant of Via ITA erest of the Revenue. The groun al are reproduced as under: and in the circumstances of the case and ipal Commissioner of Income tax ('PCIT) h section 263 is without juri iction, unwar voking revision proceedings under section Act, 1961 ('the Act') without apprec order passed by the National e-Assessm ssessment Order') was neither erro the interest of the revenue; appreciate that the Assessment Order w tion of relevant details and documentar ation of mind vis-à-vis issues per on goodwill and carry forward of losses; ppreciate that the NeAC had taken a pla judicial precedents and prospective am the Act and had allowed depreciation on udice to above, the learned PCIT has: of Depreciation on Goodwill irecting the learned Juri ictional Assess y and disallow the claim of depreciation ly disallowed by the Department in other ppreciate that in view of prospective am f the Act, depreciation on goodwill is al 2020-21; ejudice to the above, failed to appreciate t of depreciation of Rs. 195,32,57,760 Rs. 1,87,75,81,932 pertains to depre merger of Prism TV Pvt. Ltd. and Rs. 85,6 n acquisition of Studio 18 and the balance 73 pertains to depreciation on Voot platf ble asset) and not goodwill. f carry forward of losses acom 18 Media Pvt. Ltd 2 A No. 2591/MUM/2025 ds raised by the d in law, the has: rranted and n 263 of the ciating that ment Centre neous nor was passed ry evidence rtaining to ausible view mendment in goodwill; sing Officer on goodwill years; mendment in lowable for e that out of 0, only an eciation on 55 pertains e amount of form (which 7. erred in de Rs. 6,86,23,5 allowed by th 2. Briefly stated fa Media Private limited under the provisions under consideration activities inter-alia, b and advertising airt television channels; platform; licensing a events and productio 2.1 The assessee assessment year und further revised on 3 289,31,48,390/-. The the scrutiny assessm Act were issued and transfer pricing refer arm’s-length price of the assessee. The f order under section 26/09/2022 determ making variations pro Via ITA etermining the amount of carried forwar 58,774 instead of Rs. 10,22,35,12,612, a he NeAC. acts of the case are that the ass d is a company incorporated o s of the Companies Act, 1956. D n, the assessee was engage broadcasting of television chan time on television channels; over-the-top(OTT) and digital c and merchandising products; on/distribution of films/program filed its regular return of i der consideration on 29/11/20 30/03/2020 declaring total los e return filed by the assessee w ment and statutory notices und complied with. During the scru rence was also made for deter f the international transactions faceless assessment unit pass 143(3) read with section 144B ining total loss at (-) ₹281,32 oposed by the learned Transfer acom 18 Media Pvt. Ltd 3 A No. 2591/MUM/2025 rd losses at as correctly essee Viacom18 on 19/12/1995 During the year d in business nnels; marketing distribution of content delivery organising live ms etc. income for the 019, which was ss of rupees (-) was selected for der the Income- utiny proceeding mination of the s carried out by sed assessment B of the Act on 2,98,884/- after Pricing Officer.
2 Subsequently, records and after e assessment order pa insofar as prejudicia two issues: (i) incorrect allo amalgamation 2016-17 and (ii) incorrect dete 2.3 In view of above cause notice dated 2 the assessment orde The Authorised Repr the faceless assess submission of the a accepted the claim amalgamation of ‘P contended that revis cannot be initiated u satisfied. It was furth examined all the reco due application of m under Explanation- 2 also filed submissio Via ITA the learned PCIT called for t examination, he was of the assed by the Assessing Officer al to the interest of the Revenu owance of depreciation on ‘goodw n which was denied in earlier as 2017-18 by the Assessing Offic ermination of carry-forward of b e observations, the learned PCIT 22/11/2024 calling upon the a er should not be revised on ab resentative(AR) of the assessee sment unit after due consid assessee and carrying out requ of depreciation on goodwill, w Prism TV P Ltd’ with the as sionary proceedings against as unless conjunctive conditions of her contended that Assessing O ords at the time of assessment mind and therefore even the deem 2 to section 263 are not fulfille ns on the merit of the both acom 18 Media Pvt. Ltd 4 A No. 2591/MUM/2025 the assessment view that the was erroneous ue, on following will’ acquired on ssessment years cer business losses T issued a show assessee as why bove two issues. submitted that deration of the uired enquiries, which arose on ssessee. It was ssessment order section 263 are Officer had duly proceeding with ming conditions d. The assessee the issues and submitted that depr have been allowed l PCIT was however no accordingly held the prejudicial to the int setaside the order w passong a fresh asse Aggrieved, the asse Appellate Tribunal grounds as reproduce 3. Before us the a 319. In the grounds section 263 by the ld on merit. As the facts therefore, firstly we d 3.1 The facts qua th are that during the y depreciation on good under: Sr. No Particulars i. Depreciation on acquisitio 18 (a divisio 18 Media & Pvt. Ltd.) in Via ITA eciation on goodwill and carry awfully by the Assessing Offic ot convinced with the reply of t e assessment order as errone terest of the Revenue on both with the direction to the Asses ssment order after making nece essee is an appeal before t (in short the ‘Tribunal’) by ed above. assessee filed a paper book cont raised the assessee has challen d PCIT, both on legal ground as s related to both the issues are decide legal ground and then gro he issue in dispute of depreciat year under consideration the a dwill and intangible assets ha Amount (Rs.) Remarks by the Assessee n on goodwill on of Studio on of Network Investments A Y 2008- 09 85,655 Hon’ble Mumbai ITAT allo of depreciation in the firs itself, i.e. AY 2008- 09 acom 18 Media Pvt. Ltd 5 A No. 2591/MUM/2025 y forward losses cer. The learned he assessee. He eous insofar as the issues and ssing Officer for essary inquiries. the Income-tax way of raising taining pages 1- nged onvoking of s well as ground interconnected, ound on merit. tion on goodwill ssessee claimed aving details as e owed claim t year ii. Depreciation resulting on amalgamatio TV Pvt. Ltd. into Viacom 2016-17 iii. Depreciation Intangible R Platform) Total 3.2 The learned co page 1, which is a co submitted that retur verification of the va depreciation claim of The learned counsel, which is a copy of submitted that the A page-18) asked the counsel submitted t raised by the Assessi by the assessee whic with notes to financia Further the learned c by the Assessing Offi pages 33 to 37 and s asked the assessee Via ITA n on goodwill n account of on of Prism ('Prism TV') 18 in AY 1,87,75,81,932 Goodwill recognized in vie scheme of amalgamation by Hon’ble Bombay High No Goodwill was existed i books of amalgamating co and hence, the Goodwill h arisen on amalgamation, depreciation upto 1.4.202 n on Rights (Voot 7,55,90,173 There is no Goodwill in th This is an intangible asse capitalized in AY 2017-18 depreciation was never di the Department. 195,32,57,760
unsel for the assessee referre py of notice under section 143(2
rn of income was selected for t arious issues including one o f the assessee.
, further referred to paperbook notice under section 142(1)
Assessing Officer vide query No details of claim of depreciatio that assessee duly responded ing Officer. He referred to copy o ch is available on paperbook pa al statement available on paperb counsel referred to a show caus icer, a copy of which is availabl submitted that the Assessing Of to support claim of depreciati acom 18 Media Pvt. Ltd
6
A No. 2591/MUM/2025
ew of the approved
Court.
in the ompany had purely eligible for 21. his asset.
et
8 on which isputed by d to paperbook
2) of the Act and the scrutiny for f the issues as pages 16 to 22, of the Act and . 8 (Paper Book on. The learned to the queries of the reply filed ges 23-32 along book page 289. se notice issued le on paperbook fficer specifically ion on goodwill with documentary ev cause notice also refe heads of income. In cause notice, a copy
45, the assessee pro depreciation on good also submitted that assessment unit in a 19. The assessee als
Bench of Income-tax dated 29/01/2016, goodwill on accoun assessment year 200
also filed copy of th approving the schem limited’ along with va arising on amalgama
3.3 The learned cou
(three) of the asses
Officer after due e assessee and after c claim of depreciatio
Regarding the quantu learned counsel sub Via
ITA vidences. The Assessing Office erred to large business loss set o the submission filed in respon of which is available on paperb ovided complete details of com dwill as well as justification for i t similar claim was allowed b assessee’s own case for assessm so filed a copy of the order of x Appellate Tribunal ( in short wherein the claim of depre nt of merger of the ‘studio
08-09 was allowed to the assesse he order of the Hon’ble Bomb me of amalgamation with ‘Pri aluation report supporting value ation with the prisoner TV privat unsel for the assessee referred ssment order and submitted examination/verification of the considering the judicial decision on on goodwill by way of e um of business loss to be carri bmitted that the Assessing O acom 18 Media Pvt. Ltd
7
A No. 2591/MUM/2025
er in said show off against other nse to the show book page 38 to mputation of the its claim. It was by the faceless ment year 2018- the Coordinate t the ‘Tribunal’) eciation on the 18’ division in ee. The assessee bay High Court ism TV private e of the goodwill te limited.
to paragraph 3
that Assessing e claim of the ns accepted the express finding.
ied forward, the Officer has duly verified the brought earlier years and aft
₹1022,35,12,612/- to 4. The learned De hand submitted that inquiries which he ou depreciation of the go of business losses an be erroneous insofar under Explanation-2
5. We have heard invoking Explanation assessment order to interest of the Revenu reproduced as under [Explanation 2.-For an order passed b as the case may b prejudicial to the in 53[Chief Commissio or Commissioner,-
(a) the order is passe have been made 4
(b) the order is passe
(c) the order has not instruction issued
(d) the order has not prejudicial to the Via
ITA t forward losses adjusted aga ter verification only he compute o be carried forward to next asse epartmental Representative (DR t the Assessing Officer has not ught to have been carried out o oodwill as well as on the issue o nd therefore the assessment ord r as prejudicial to the interest to section 263 of the Act.
rival submission of the parties n -2 below section 263 of the A o be erroneous insofar as pre ue. For ready reference, the said
:
r the purposes of this section, it is he y the Assessing Officer 52[or the Tran be,] shall be deemed to be erroneous nterests of the revenue, if, in the opin oner or Chief Commissioner or Princi ed without making inquiries or verific
48; ed allowing any relief without inquiring t been made in accordance with any d by the Board under section 119; or t been passed in accordance with any assessee, rendered by the juri icti acom 18 Media Pvt. Ltd
8
A No. 2591/MUM/2025
ainst profits of ed the losses of essment year.
R) on the other carried out the on the issues of of carry forward der is deemed to of the Revenue on the issue of Act, deeming the ejudicial to the d explanation as ereby declared that nsfer Pricing Officer, s in so far as it is nion of the Principal ipal] Commissioner ation which should g into the claim; y order, direction or y decision which is ional High Court or Supreme Court in 5.1 On plain readin
(a) and (b) specify th inquiries, which he circumstances of the be erroneous insofar
Therefore for invoki examine whether the which he ought to ha of the case.
As far as the first issu
Assessing Officer in dated 19/08/2021(PB
“8. With resp provide the fo
1. Detail of th ii) Opening WD iii) Addition a iv) Depreciatio v) Detail of ad justification fo v) Date of pur during the yea
Via
ITA the case of the assessee or any other ng of the above provision, we fi hat if Assessing Officer fails in c ought to have carried out in e case, then the assessment ord r as prejudicial to the interest ng of the deeming Explanatio e Assessing Officer had carried o ave carried out in the facts and ue of depreciation on goodwill is his first notice under section 1
B-18) raised following query:
pect to depreciation claimed during the ollowing details:
he asset/block
WDV nd deletion during the year on charged on assets/block T dditional depreciation claimed, if any al or the same rchase and date of put to use for the ass ar along with documentary evidence”
acom 18 Media Pvt. Ltd
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A No. 2591/MUM/2025
r person.]
ind that clauses carrying out the n the facts and der is deemed to of the revenue.
on, we have to out the inquiries d circumstances s concerned, the 42(1) of the Act year, kindly ong with the sets acquired
2 In response to a 03/09/2021 filed su relevant part of which “8. Deprecia The details w and deletions the assets ar claimed any a 5.3 Along with the a chart as per the prov as how in assessmen introduced goodwill depreciation thereon depreciation chart is “3. In AY 201 August 2016 Media Private concern basis consideration Private Limi 19,340,040,3 intangibles (c contracts, kn customers, d and distributi rights, license approvals, le and various under variou acquired by th Company). Th @ 25% on the on the followi CIT, Ko Via ITA above query, the assessee throu ubmission(PB-27) before the As h is reproduced as under: ation claimed during the year with respect to fixed assets, opening WD s made during the year and depreciation re enclosed as Annexure 3. The Compa additional depreciation during AY 2019-2 above reply, the assessee enclos visions of the in Act along with a nt year 2016-17 for the first tim l in its books of accounts . The relevant part of the note a reproduced as under: 16-17, as per the Bombay High Court Ord Prisrn TV Private Limited has merged wi e Limited with effect from 1 April 2015 s. As per the said Order, the Company n of Rs 19,340,040,368 for the acquisition ited. Out of the said considerat 368, Rs 1780,22,58,316 was paid towa customer relationship, skilled workforc ow- how, business information, tradem distributors/suppliers, rights, processes ion strategies, commercial rights, intellect es, permits, trademarks, copyrights, pate ase. tenancy rights, permissions, incen other rights, title, interest, certificates, us legislations, contracts, agreements he Company (reflected as goodwill in the he assessee submits that it is eligible for e written down value of the aforesaid goo ng decisions: olkata v. Smifs Securities (24 taxmann.co acom 18 Media Pvt. Ltd 10 A No. 2591/MUM/2025 ugh reply dated ssessing Officer, DV, additions n charged on any has not 20.” sed depreciation a note specifying me the assessee s and claimed appended to the der dated 12 ith Viacom18 5 on a going y has paid a n of Prism TV tion of Rs ards various ce, business marks, list of s, marketing tual property ents, quotas, ntives, grants registrations s, consents) books of the depreciation odwill based m 222(SC)]
Areva
High C
Viacom
Tribun
B. Rav
(Kerala
Skyline
(Mumb
Bosch
Tribun
Kotak
(Mumb
A.P. P
(Hyder
Mylan
2335/H
5.4 Thereafter, agai the issue of deprecia dated 17/09/2022 (P under:
“1. Deprecat
There is a h machinery fo
6,41,38,569/
days addition daysor more period of les furniture and addition of R less than 180
of addition, Pl intangible rig evidences dep your explanat
Via
ITA
T & D India Ltd vs DCIT ((2012) 345 IT Court) m 18 vs ACIT (ITA No. 7336/Mum/20
al]
veendran Pillai vs CIT ((2010) 194 T a HC)]
. Hindustan Coca Cola Beverages Pvt. Ltd bai Tribunal)]
Ltd. vs. CIT (2009-TIOL-736-ITAT-Bang al)) bai Tribunal)]
rabad Tribunal)]2
Hyd./2018] (Hyderabad Tribunal) n the Assessing Officer issued f ation of the goodwill in his sho
PB-34), relevant part of which is tion claimed during the year:- huge addition of Rs. 13,00,40,337/-, In r a period of 180 days or more and ad
- in plant and machinery for a period of le n of Rs. 3,60,56,776/- in Building for a p and addition of Rs. 1,08,92,052/- in B ss than 180 days. Addition of Rs. 33, d Fixture for a period of 180 days o
Rs.7,58,570/- in furniture and fixture for 0 days. Please provide documentary evid lease provide details of ghts goodwill with in absence of d epreciation claimed may be disallowed.
tion.
acom 18 Media Pvt. Ltd
11
A No. 2591/MUM/2025
TR 421 (Delhi
12) [Mumbai
Taxman 477
d (2011) 198
td [(2009) 34
20 SOT 266
g (Bangalore
33 SOT 237)
28 TTJ 596
6(2) [ITA No.
further query on ow cause notice s reproduced as In plant and ddition of Rs.
ess than 180
period of 180
Building for a ,71,323/- in or more and r a period of dence/ proof documentary
Please give
Large bus As per ITR Sc further years carried forwa 1. As per ITR, of Rs. 3,29,23 2012-13 in c current year setoff losses o 2. As per sch Rs. 28,23,90, 2013-14 in 60,14,50,061 3. As per ITR of Rs. 32,68,4 2014-15 in co forward is R 1,44,60,456/ 4. As per ITR carried forwa loss) whereas computation o Rs. 53,86,79, 5. As per ITR forward losse in ITR for the is Rs. 3,27,30 6. As per ITR forward loss ITR for the A. is Rs. 2,84,72 7. As per ITR forward losse ITR for the A. Rs. 63,45,24, years setoff o amount and 7,39,70,30,88 A.Υ. 2019-20 Via ITA siness loss set off against other head chedule -CFL details of losses to be carrie s and as per ITR of A.Y. 2012-13 to A ard and setoff losses are as under:- , Schedule CFL, you have shown carried f 3,489/- whereas you have shown in ITR computation of total income. Part-B- it, to be carried forward is Rs. 35,86,04 of Rs. 1,64,64,634/- hedule -CFL you have shown carried for ,284/- whereas you have shown in ITR computation of total income, part-B /- after setoff of Rs. 2,87,26,469/-. R Schedule-CFL you have shown carried f 43,710/- whereas you have shown in ITR omputation of total income. Part-B, it is lo Rs. 32,68,43,710/- after setoff of los -. R Schedule -CFL ITR A.Y. 2019-20 you ard losses of Rs. 53,86,79,186/- (long s you have shown in ITR for the A.Y. of total income Part-B, it is losses carrie 186/- and no set off of losses during the Schedule-CFL (ITR-2019-20) you have sh es of Rs. 3,27,30,79,767/- whereas you A.Y. 2016-17 in computation of total inco 0,79,767/- after setoff of losses Rs. 2,86,3 Schedule -CFL ITR-2019-20 you have sh of Rs.2,84,72,69,524/- where as you ha .Y. 2017-18 in computation of total incom 2,69,524/- after setoff losses of Rs. 1,63,9 Schedule-CFL ITR -2019-20, you have sh es of Rs. 63,45,24,113/- whereas you ha Y. 2018-19 in computation of total incom 113/- after setoff of losses Rs. 11914872 of losses have been taken by you but non show carried forward and set off lo 87/- upto assessment year 2018-19 an 0 shown Rs. 2,82,64,81,723/- in CFL. H acom 18 Media Pvt. Ltd 12 A No. 2591/MUM/2025 of income. ed forward to A.Y. 2019-20 forward loss R for the A.Y. is losses of 4,260/- after rward loss of R for the A.Y. B it is Rs. forward loss R for the A.Y. osses carried sses of Rs. have shown term capital 2015-16 in d forward is year. hown carried have shown ome, part-B it 34,759/-. hown carried ave shown in me, Part-B, it 93,113/-. hown carried ave shown in me part-B it is 25/- in many n reduce this osses of Rs. nd losses for However, no loss shown i provide calcul 5.5 In response to submission on the c available on paperb reproduced as under 6. Depreciat 6.1 Depreciati The documen been furnishe dated 27 Sep Annexure 2 fo 6.2 Deprecia For AY 2019 1,87,76,67,58 intangible as assessee. The assessee is a Particulars Depreciation on goodwill result (a division of Network 18 Medi 09 Depreciation on goodwill result TV Pvt. Ltd. (‘Prism TV’) into Via Total Note A In AY 2008-0 of Network 1 Network 18 Agreement da per the said a Rs 4,13,53,6 3,44,00,309 a of the Compa the said agre Via ITA in computation of ITR 2019-20. Please lation accordingly.” o above query, the assessee f claim of the depreciation on go book page 42-44, relevant pa : tion under Income-tax Act ion on assets other than goodwill tary evidence/ proof of additions to fixed ed on sample basis as Annexure 7 to the ptember 2021. Copy of the same is re or ready reference. ation on goodwill 9-20, the assessee has claimed depreci 87 on consideration paid for acquisition ssets reflected as "goodwill" in the b e break-up of depreciation on goodwill cla as under: Amount (Rs.) ting on account of acquisition of Studio 18 ia & Investments Pvt. Ltd.) in AY 2008- 85,655 ting on account of amalgamation of Prism acom 18 in AY 2016-17 1,87,75,81,932 1,87,76,67,58 09, the Company had acquired the Studio 18 Media & Investments Private Limit Fincap Limited) under the Busine ated 11 September 2007 on a going conce agreement, the Company has paid a con 652 for the Net Current Assets aggreg and Rs 69,53,343 (reflected as goodwill any) was paid towards various rights acq eement including the business contracts acom 18 Media Pvt. Ltd 13 A No. 2591/MUM/2025 explain and filed a detailed odwill, which is art of which is d assets have e submission eattached as iation of Rs. n of various books of the aimed by the Remarks Refer note A 2 Refer note B 87 o 18 division ted (formerly ss Transfer ern basis. As nsideration of gating to Rs in the books quired under (distribution, sub-distributi related intelle name of Stud at 25% on wr the issue re resulting on a in favour of t assessee's ow depreciation o herewith as Department Tribunal and High Court. A issue is now be allowed to Studio 18. Note B In AY 2016-1 12 August 2 Viacom18 Me going concern the considera Prism TV. As p a consideratio TV Private Lim consideration 1780,22,58,3 relationship, business in distributors/s distribution s rights, license approvals, le and various under variou acquired by t which deprec intangible ass not recorded claimed there goodwill, a c acquired by a in the books o has acquired Prism TV and Via ITA on, production, etc.) brand name of Studi ectual property rights, right to do bus io 18. The Company had claimed depreci ritten down value. The assessee humbly elating to allowability of depreciation account of acquisition of Studio 18 is alre the assessee by the Hon'ble Mumbai Tri wn case for AY 2008-09 (the first year on such goodwill). A copy of the said orde Annexure 3. Further, we understan has accepted the order of the Hon' not preferred an appeal before the Hon Accordingly, the assessee submits that t settled and hence deprecation of Rs.85,6 o the assessee arising on account of a 7, as per the Hon'ble Bombay High Court 2016 Prism TV Private Limited has m edia Private Limited with effect from 1 Apr n basis. The merger was not a tax neutr ation i.e. shares were issued to the parent per the said High Court order, the Compa on of Rs 19,340,040,368 for the acquisi mited by issue of shares at fair value. Ou n of Rs 19,340,040,368, an amo 316 was paid towards various intangibl skilled workforce, business contracts, nformation, trademarks, list of suppliers, rights, processes, mark strategies, commercial rights, intellectu es, permits, trademarks, copyrights, pate ase, tenancy rights, permissions, incen other rights, title, interest, certificates, us legislations, contracts, agreements the Company (reflected as goodwill in th ciation @ 25% was claimed as part sets. The assessee submits that said g in the books of Prism TV and no depre eon by Prism TV (i.e. amalgamating comp capital right comprising of various inta amalgamated company, is recorded for t of Viacom 18 (i.e. amalgamated company such goodwill consisting of various inta d separately discharged consideration for acom 18 Media Pvt. Ltd 14 A No. 2591/MUM/2025 io 18 and the iness in the iation on this y submit that on goodwill eady decided ibunal in the r of claim of er is attached nd that the 'ble Mumbai n'ble Bombay the aforesaid 655/- should acquisition of t Order dated merged with ril 2015 on a ral merger as t company of any has paid tion of Prism ut of the said unt of Rs es (customer know-how, customers, keting and ual property ents, quotas, tives, grants registrations s, consents) he books) on of block of goodwill was eciation was mpany). Thus, angible rights the first time y). Viacom 18 angibles from r the same, it has recorded 14 on the ba and consequ provisions of in case of Sm order of the H approving the 1|April 2015 A copy of th Merchant Ba determining t of Prism TV Annexure 5. F extract (as the 2016 obtaine connection wi of Prism TV as The assessee of depreciatio Prism TV is Assessment U copy of the Accordingly, 1,87,75,81,93 account of acq 5.6 In this submis goodwill comprised o ₹85,655/-on goodwil 18 in assessment ye Secondly, depreciatio resulting on account assessee in assessm Regarding the secon order of the Hon’b approving the merge Via ITA the same in accordance with Accounting asis of fair value determined by indepen uently, claimed depreciation in accor the Act read with decision of Hon'ble Su mifs Securities Ltd (24 taxmann.com 222 Hon'ble Bombay High Court dated 12 A e merger of Prism TV into Viacom 18 wit is attached herewith as Annexure 4. he valuation report obtained from Ern anking Services Pvt. Ltd. dated 2 Feb the fair exchange ratio of shares in relati Pvt. Ltd. into Viacom 18 is attached Further, we also attach herewith as Ann e size is bulky) of copy of report dated 1 ed by Viacom 18 from KPMG India ith purchase price allocation on account o s at 1 April 2015. e humbly submit that the issue relating to on on goodwill resulting on account of a decided in favour of the assessee by Unit in the assessee's own case for AY said order is attached herewith as A the assessee submits that the deprec 32/- should be allowed to the assesse quisition of Prism TV. sion, the assessee explained of two items, firstly, depreciatio ll resulting on account of acqui ear 2008-09 with a complete n on amounting to ₹1,87,75,81,93 of amalgamation of ‘Prism TV P ment year 2016-17 along with a d item the assessee also enclo ble Bombay High Court date er of Prism TV Pvt Ltd into the acom 18 Media Pvt. Ltd 15 A No. 2591/MUM/2025 g Standard - ndent valuer rdance with upreme Court 2). A copy of August 2016 th effect from nst & Young bruary 2016 ion to merger herewith as nexure 6, an 6 September Pvt. Ltd. in of acquisition o allowability acquisition of the Facelsss Y 2018-19. A Annexure 7. cation of Rs. ee arising on depreciation on on amounting to isition of studio note separately. 32/-on goodwill Pvt Ltd’ with the a detailed note. osed copy of the ed 12/08/2016 e assessee with effect from 01/04/2 Ernst & Young mer 02/02/2016 determ relation to merger an year 2018-19 i.e. im Assessing Officer al arising from merger o 5.7 After thorough keeping in view such in immediately prec Assessing Officer ac following observation “3. In this cas and claimed questionnaire above time l 19.09.2022, evidence of a dated 19.09.2 on perusal of found consid examined and 5.8 Similarly on th forward also the As claim of the assessee 4. During th assessee has same agains assessee vide Via ITA
2015; copy of valuation report chant banking services Private mining the fair exchange ratio nd copy of the assessment order mmediately prior assessment ye llowed the claim of depreciati of Prism TV.
examination of the claim of th h depreciation allowed by the A ceding assessment year i.e. AY ccepted the claim of the ass n in the assessment order:
se, assessee has claimed substantial dep d additional depreciation. For verifyi e and show cause notice issue to assess ine mentioned in above table. Vide rep assessee company has submitted doc addition to fixed assets in Annexure -2 of 2022. On examination of reply of the asse f Annexure-2, submission of assessee co derable and issue of depreciation cl d found correct.”
he issue of business losses se sessing Officer after verificatio observing as under:
e assessment proceedings, it is found s substantial income business loss and t income under the other heads. On t e reply dated 19.09.2022, submitted that acom 18 Media Pvt. Ltd
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A No. 2591/MUM/2025
t obtained from e Limited dated o of shares in r for assessment ear, wherein the ion on goodwill he assessee and Assessing Officer
Y 2018-19, the sessee with the preciation/
ing issue see as per ply dated cumentary of its reply essee and ompany is laimed is et off and carry on accepted the d that the set-off the this issue t "
The assessee
6 for the year of loses claim that profits o amounting to were set off a 14:
Assessment
2010-11
2011-12
2015-16
Total profits
Less: losses set off again
2009-10
2012-13
2013-14
Total losses s
After setoff of 10, A.Y. 2012
are carried fo
AY
2009-10
2012-13
2013-14
Via
ITA e humbly submit that the losses shown in r under consideration are losses remainin med in earlier years. The assessee humb of A.Y 2010-11, A.Y. 2011-12 and A.Y.
R.s 3,03,62,15,139/- (refer the break against losses of A.Y. 2009-10, 2012- 13 a year
Profits/ (loss) for th year
10,49,98.521/-
92.51,51.908/-
200,60.64,710/-
3,03,62,15,139/- of following years nst above profits
(2,39,14,74,491/-)
(32,56,80,871)
(31,90.59,777) set off
3.03.62,15,139/- f taxable profits the losses remaining for 2-13 and AY 2013- 14 is as under and rward to subsequent year:
Total losses as per
ITR
(A)
Losses set off as above (B)
Net for (A-B
AY
2,39.14.74,491
239,14,74,491
Nil
35,86,04,360
32,56,80,871
3,2
60,14,50,061
31,90,59,777
28, acom 18 Media Pvt. Ltd
17
A No. 2591/MUM/2025
n form ITR ng after set bly submit
Y. 2015-16
up below) and 2013- e
AY 2009- the same t losses available carry forward
B) to subsequent
29,23.489
23,90,284
2014-15
2015-16
2016-17
2017-18
2018-19
Total losses of earlier year b/f (A)
Losses of current year ie
2019- 20
Total losses c/f as per
ITR
On examinat assessee is fo
5.9 In view of the a Assessing Officer ha depreciation on the g be carried forward. I mention every reason such reasoning is particularly not acc making additions. T
Assessing Officer in assessment order. In Assessing Officer eve
Via
ITA
32,68,43,712
0
32,
0
0
m
327,30,79,767
0
327
284,72,69,524
0
284
63,45,24,113
0
63,
1043,32,46,028
303,62,15,139
739
e. 282,64,81,723
0
282
1325,97,27,750
303,62,15,138
102
tion of submission of the assessee, rep ound considerable hence, accepted.”
aforesaid discussion, we are of t ad thoroughly examined both goodwill as well as amount of b
It is not necessary for the Asse ning for accepting the view of th required whenever the Asses cepting the contention of the This is the normal practice f the Income-tax Department wh n the instant assessment ord en made clear that he has allow acom 18 Media Pvt. Ltd
18
A No. 2591/MUM/2025
68.43,712
7,30,79,767
4,72,69,524
45,24,113
9,70,30,887
2,64,81,723
22,35,12,612
ply of the the opinion that h the issues of business loss to essing Officer to he assessee and ssing Officer is e assessee and followed by the hile framing the der however the wed the claim of the assessee after assessee on various circumstances, we
Assessing Officer ha have carried out in Accordingly, we rejec
Representative that erroneous insofar a invoking Explanation
5.10 Another argum representative is th consistent stand take years 2016-17 and 2
first year of claim of d of Prism TV P ltd, th assessee. In assessm disallowed by the Ass this issue. According the issue was not principle of consiste mandatorily required disallow such deprec action of the Assessin revenue.
Via
ITA due verification of the subm s queries raised by him. In s do not have any doubt in d carried out the inquiries wh n the facts and circumstance ct the contention of the learne the assessment order is s prejudicial to the interest o n -2 below section 263 of the Act ment advanced by the learned hat Assessing Officer has no en by the Department in preced
2017-18. The assessment year depreciation of the goodwill aris he Assessing Officer disallowed ment year 2017-18 also such a sessing Officer and assessee is i g to the learned departmental re accepted by the Department ency and to keep the matter d to follow the stand of the D ciation on the goodwill. Accord ng Officer was prejudicial to the acom 18 Media Pvt. Ltd
19
A No. 2591/MUM/2025
missions of the such facts and our mind that ich he ought to es of the case.
d Departmental deemed to be of the Revenue t.
d departmental ot followed the ding assessment r 2016-17 being ing from merger the claim of the claim has been in the appeal on epresentative, as t, following the r alive, he was Department and ding to him this e interests of the 6. We have heard
We are of the opinion
Assessing Officer ac goodwill and therefo wherein he followed immediately prior a following consistent without prejudice, ev department is not fol the AO might be prej not erroneous, becau in the case of the ass depreciation on the g studio 18 division wit has not been reverse therefore the Assessi the issue in dispute,
Since for invoking assessment order sh interest of the Reven issue the condition fulfilled and therefo proceeding on this Departmental Repres
Via
ITA rival submission of the parties n that firstly, in assessment ye ccepted the claim of the depr ore the Assessing Officer can d the finding of the Assessing assessment year. The claim of stand of Department is falla ven if we presume that consiste llowed, we are of the opinion th judicial to the interest of the Re use in assessment year 2008-0
sessee in ITA No. 7336/Mum/2
goodwill generated on account o th the assessee as going concer ed by the Hon’ble juri iction H ing Officer has followed a bindin
, which action cannot be terme section 263 both the cond hould be erroneous as well as p ue are to be satisfied cumulativ of the assessment order to er ore the learned PCIT cannot s issue.
This argument o sentative is accordingly rejected.
acom 18 Media Pvt. Ltd
20
A No. 2591/MUM/2025
s on this issue.
ar 2018-19, the reciation of the nnot be blamed g Officer in the f ld DR of not acious. Further, ent stand of the hat this action of evenue, but it is 09, the Tribunal
012 allowed the of merger of the rn. Said decision
High Court and ng precedent on ed as erroneous.
ditions i.e. the rejudicial to the vely, but on this rroneous is not invoke revision f the learned
.
Now we take up action of the Assessi interest of Revenue. 8. We have heard r the merit of the matt it comprises of the t respect of acquisition dispute. Secondly, amalgamation of Pris is in dispute. Thirdly Fourthly, dispute is losses to the subseq issues one by one. 8.1 Firstly, we take Studio 18. Fact qua year 2007-08 relevan had acquired the “S Investments Pvt. Ltd As per the business the net assets at th consideration of Rs.4 Rs.69,55,343/-. The the said goodwill sin Bench of the Tribuna Via ITA p the grounds on the merit as ing Officer is erroneous and pr rival submissions of the parties ter. As far as claim of depreciati hree parts. Firstly, depreciation n of Studio 18 amounting to Rs depreciation on the goodwill sm TV Ltd. amounting to Rs.1 y, depreciation on Voot Platform in respect of verification of c quent assessment years. We ta up issue of goodwill in respect issue in dispute are that durin nt to assessment year 2008-0 Studio 18” division of ‘Networ d.’ on a going concern basis un transfer agreement, the assesse he value of Rs.3,44,00,309/- a 4,13,53,652/-, thereby recogniz assessee has been claiming nce assessment year 2008-09. T al has approved the claim of the acom 18 Media Pvt. Ltd 21 A No. 2591/MUM/2025 to whether the rejudicial to the on the issue on ion is concerned n on goodwill in s.85,655/- is in in respect of ,87,75,81,932/- m is in dispute. carry forward of ake up all these of acquisition of ng the financial 9, the assessee rk 18 Media & nder slump sale. ee had acquired against the total zing goodwill at depreciation on The Co-ordinate e assessee in the first year i.e. assess 29.01.2016 passed 265/Mum/2013. Th Department has also same before the Hon’ disputed by the ld DR 8.2 Having consider the opinion that onc accepted the claim of the Department can without any materia principle of consist Radhasoami Satsang error on the part of the assessee on this justified in holding t in so far as depreciat 18 is concerned. 8.3 The next grou goodwill in respect of are not in dispute. T with effect from 01.0 scheme duly sanctio order dated 12.08.20 Via ITA sment year 2008-09 itself in d in ITA Nos. 7446/Mu e ld. Counsel submitted that o accepted said order and did n ’ble Bombay High Court. This fa R. red above submissions of the pa e the Income-tax Department h f depreciation in the year of cap nnot alter the position in su l change in facts and legal pos tency held by the Hon’ble S g v. CIT [1992] 193 ITR 321 (S the Assessing officer on accept s issue. In view of above, the he order of the Assessing Offic tion on the goodwill on acquisiti nd on merit relates to depre f amalgamation of Prism TV. Th The assessee amalgamated Pris 4.2015 on a going concern basi oned by the Hon’ble Bombay 016. The amalgamation was a acom 18 Media Pvt. Ltd 22 A No. 2591/MUM/2025 its order dated um/2012 and the Income-tax ot challenge the act has not been arties, we are of has allowed and italization itself, ubsequent years sition in view of Supreme Court SC). There is no ting tye claim of Ld. PCIT is not er as erroneous on of the Studio eciation on the he material facts sm TV Pvt. Ltd. is pursuant to a High Court by accounted for in the financial stateme assessee disclosed, i the consideration pa excess of considerati liabilities taken over amalgamating comp goodwill recorded in thereon at any tim Assessing Officer him 8.4 In assessment y disallowed depreciat proviso to section 32 in the hands of the would have been allo amalgamation not tak 8.5 The assessee co only to mitigate sit amalgamated entities the same asset—re mischief sought to b exceeding 100% (or amalgamation). Sign before intangible ass as depreciable asset Via ITA ents for the year ended 31.03.20 in full transparency, the net a aid, and the resultant goodwill ion over the net book value of r. It is further an admitted po pany, Prism TV Pvt. Ltd., did its books, nor had it claimed a me. This fact stands acknow mself in the assessment order for year 2016-17, The Assessing O tion on such goodwill by invo (1) of the Act, on the premise th e amalgamated company cann owable to the amalgamating co ken place. ontended, that the sixth provi tuations where both the ama s could simultaneously claim esulting in an unintended du be avoided was the possibility 150% in practical scenarios inv nificantly, the proviso was in sets, including goodwill, came t ts under section 32(1)(ii). Thus acom 18 Media Pvt. Ltd 23 A No. 2591/MUM/2025 016, wherein the assets acquired, l arising as the f the assets and osition that the d not have any any depreciation wledged by the r A.Y. 2016-17. Officer, however, oking the sixth hat depreciation not exceed what ompany had the so was enacted algamating and depreciation on uplication. The of depreciation volving mid-year ntroduced even to be recognised s, the legislative intent behind the pro on goodwill that did company and cam amalgamation in the 8.6 The assessee fu was inserted into the included as deprecia According to the ass depreciation on goodw 8.7 The learned cou the decision of the M (P.) Ltd. vs. DCIT [2 depreciation on goo allowable notwithsta that the amalgamatin on such goodwill. Th books of amalgama amalgamating compa books of accounts or to amalgamation, the goodwill by the amalg case. Accordingly, it proviso to section 32 the present case sinc Via ITA oviso cannot be stretched to de d not exist in the books of the me into existence solely as hands of the amalgamated com urther contended that besides, t e statute even before the intang able asset u/s 32(1) of the Act sessee sixth proviso was not in will arising on amalgamation. unsel for the assessee has pla Mumbai Tribunal in Dow Chemi 024] 169 taxmann.com 290 (M odwill arising upon amalgama anding the sixth proviso, on th ng entity did not possess or cla he ITAT allowed depreciation on ated company by holding t any did not have any goodwill r as part of a block of depreciab erefore the question of claim of gamating company does not aris t was held that the provision 2(1) of the Act are not applicabl ce the goodwill did not exist in t acom 18 Media Pvt. Ltd 24 A No. 2591/MUM/2025 eny depreciation e amalgamating s a result of mpany. he sixth proviso gible assets were t and therefore, ntended to deny aced reliance on ical International Mum.), wherein ation was held he very ground aim depreciation Goodwill in the that since the recorded in its ble assets, prior depreciation on se in the instant ns of the sixth le to the facts of the books of the amalgamating comp amalgamation. The p ratio squarely applies 8.8 Moreover, relian Supreme Court in CI (SC), holding that go right of similar nat 32(1)(ii). This prin subsequent decisio (Karnataka HC), Th Mumbai), Urmin Mar the assessee’s own ca goodwill arising from 8.9 Further, the L moreover, in view of 2021, curtailing dep clear that depreciatio Hon'ble Bangalore v. DCIT [2022] 142 ta the Legislature is tha the said amendments If the legislative inte years as well, then th of acquisition of the g Via ITA pany but has arisen in th parallel with the present case i s. nce was placed on the decision IT vs. Smifs Securities Ltd. [201 oodwill constitutes a “business ture” eligible for depreciation nciple has been consistentl ns, including Padmini Prod hermo Fisher Scientific India rketing (P.) Ltd. (ITAT Ahmedaba ase for A.Y. 2008-09 relating to the acquisition of Studio18. Ld. counsel for the assessee f amendments brought in by th reciation on Goodwill w.e.f. 1.4 on on goodwill was allowable up ITAT in case of I & B S axmann.com 274 observed that at depreciation on goodwill is al s, is manifest from the adjustm ention was to deny depreciatio here was no need for any adjustm goodwill. acom 18 Media Pvt. Ltd 25 A No. 2591/MUM/2025 he process of is complete; the n of the Hon’ble 12] 348 ITR 302 s or commercial under section ly followed in ducts (P.) Ltd. (P.) Ltd. (ITAT ad), and even in depreciation on submitted that he Finance Act, 4.2021, made it pto AY 2020-21. Seeds (P.) Ltd. the intention of llowable prior to ent mechanism. on for the past ment to the cost
We have carefu the material on reco well as the judicia depreciation on g depreciation u/s 3 machinery, plant or intangible assets lik license, frenchisies o similar nature acqu goodwill acquired on paid over the value o company came into CIT v. Smifs Securitie 04 wherein Hon’ble S the expression ‘any nature and qualify to depreciation while co 9.1 Subsequently, result of amalgamati the Bengaluru Tribu CIT TS-553-ITAT-201 relevant to assessme assessee namely Kar got amalgamated as Via ITA ully considered the rival submi ord, and examined the statutor al precedents governing the oodwill arising upon amalg 2(1) of the Act is allowable furniture being tangible asse ke knowhow, patents, copyrigh or any other business or comm uired on or after 01.04.1998 n amalgamation (being access o of the net assets acquired) by th before Hon’ble Supreme Court es Ltd. 348 ITR 302 for assessm Supreme Court held that goodwi other business or commercial o be treated as an intangible a omputing business income. depreciation of the goodwill g ion came up before the Co-ord nal in the case of United Brave 16 (Bang.). In this case, in the ent year 2007-08 a wholly owne rnataka Bereweries and Distila peer the order of the Hon’ble H acom 18 Media Pvt. Ltd 26 A No. 2591/MUM/2025 issions, perused ry framework as allowability of gamation. The e on building, ets and also on hts, trademarks, mercial rights or . The issue of of consideration he amalgamated t in the case of ment year 2003- ill will fall under right of similar asset eligible for generated as a dinate Bench of ery Ltd. v. Addl. e previsous year ed subsidiary of ary Ltd. (KBDL) High Court. The goodwill amounting result of amalgamati paid over the fair val assets received from of Rs.15.57 crores w that by virtue of Sixt (ii) of the Act, the company was allow allowable if such suc therefore, the asses claim or be allowed scheme of amalgama which was allowable noted that ruling of t Securities Ltd. (supr fall in the category would not override 32(1)(ii), which restr specified there unde 9.2 Subsequently, Bench of Hyderabad v. DCIT TS-691-ITAT the principle of pur difference between t Via ITA to Rs.62.30 crores was shown on, being the access of purchas lue of the tangible assets and ot the amalgamating company a was claimed by the assessee. Th th Proviso (earlier Fifth Proviso) depreciation in the hands o wable only to the extent that ccession or amalgamation had n ssee being amalgamated comp d depreciation on the assets a ation of an amount more than t e to the amalgamating company the Hon’ble Supreme Court in t ra) was only on the point wheth of intangible assets and the the provisions of the said pro ricted the claim of depreciatio r. identical issue came before t Tribunal in the case of Mylan L T-2019 (Hyd). In the case the as rchase method of accounting, the amount of investment in t acom 18 Media Pvt. Ltd 27 A No. 2591/MUM/2025 as arising as a se consideration ther net current and depreciation he Tribunal held to section 32(1) of amalgamated was otherwise not taken place, pany could not acquired in the the depreciation y. The Tribunal the case of Smif her the goodwill said judgement oviso to section on in the cases the Co-ordinate Laboratories Ltd. sessee following considered the the fair market value of net assets Assessing Officer dis upon the decision of case of United Brewe Tribunal after consid that deduction of d invoking Sixth Provi the assessee that th mechanism of allocat written down value o whereby such deprec and amalgamated co no applicability for amalgamation in th Tribunal referred to observed that in cas the consideration pa liabilities of the am goodwill and such go u/s 32(1) by relying Court in the case of S 9.3 In view of the strands of Tribunal j one taking the re Via ITA s as goodwill arising of ama sallowed the depreciation on f the Bengalurur Bench of the eries Ltd. (supra). The Co-ordina dering the arguments of the bo depreciation on goodwill could so (earlier Fifth Proviso) except he Sixth Proviso to section 32(1 tion of the depreciation otherwi of assets owned by the amalgam ciation got allocated between th ompany in the year of amalgam r any new asset arising o he hands of the amalgamated accounting principles laid dow se of amalgamation in the natu aid in access of the net value malgamating company was to oodwill was held to be eligible g upon the decision of the H Smif Securities Ltd. (supra). above discussion we note ex jurisprudence prior to the Finan strictive view [e.g., United B acom 18 Media Pvt. Ltd 28 A No. 2591/MUM/2025 algamation. The goodwill relying Tribunal in the ate Bench of the oth parties held not be denied ting the plea of 1)(ii) was only a ise allowable on mating company, e amalgamating mation and had on account of company. The wn in AS-14 and ure of purchase e of assets and be treated as for depreciation on’ble Supreme xistence of two nce Act, 2021— Breweries Ltd.,
Bangalore Tribunal interpretation consi
Laboratories Ltd., Hy the present case foll reasonable interpret authority and consi where two views are p one which is not con revision merely beca
PCIT was, therefore, adopted by the Asses
9.4 In view of the ab of the Hon’ble Suprem as the consistent lin depreciation on good goodwill existed in t hold that the sixth pr present case. The goo came into existence depreciation under s our view, correctly depreciation accordin
9.5 Further, an a curtailing depreciatio
Via
ITA
(supra)] and another adopti istent with Smifs
Securities yderabad Tribunal)]. The Asses lowed the latter view, which is tation borne out of binding S stent Tribunal decisions. It is possible, and the Assessing Offi trary to law, the same cannot b ause another view is also feasib not justified in disturbing the ssing Officer.
bove discussion, and applying t me Court in Smifs Securities Ltd ne of authority supporting the dwill arising upon amalgamation the books of the amalgamatin roviso to section 32(1) has no ap odwill in question is a new intan e only upon amalgamation an section 32(1)(ii). The Assessing appreciated the legal positio ngly.
amendment brought by the Fin on of goodwill is prospective and acom 18 Media Pvt. Ltd
29
A No. 2591/MUM/2025
ng the broader s
[e.g.,
Mylan ssing Officer in a possible and Supreme Court s trite law that icer has adopted be substituted in ble. The learned e plausible view the binding ratio d (supra). as well e allowability of n where no such ng company, we pplication to the ngible asset that nd qualifies for g Officer has, in on and allowed nance Act, 2021
d does not apply in the year under c allowed the deprecia the settled legal pos
Assessing Officer. Th his own interpretatio
Assessing Officer is ground
10. The third groun
Platform. The Ld. co
PCIT committed erro assets, being Voot pl of the goodwill. He was not even a subj
2016-17 and 2017- material facts as co
2017-18 and particul the intangible asset finding in relation to depreciation assets consistency also the 11. The next issue subsequent assessm during the year und forward of business
Via
ITA consideration. Thus the Assess ation of the goodwill consciousl ition. We find no infirmity in t he action of the PCIT in seekin on for a legally tenable view unsustainable. The assessee su nd on merit is related to depre ounsel for the assessee submitt or in setting aside depreciation latform, by misunderstanding th submitted that depreciation on ect matter of disallowance in a -18. In our opinion, without mpared to the assessment yea larly the depreciation of the Voo ts other than the goodwill an o depreciation of goodwill does n in Voot platform. In view action of the Ld. PCIT is not jus relate to denying carry forwa ment years. The facts qua the d der consideration, the assessee losses of Rs.1022,35,12,612/- acom 18 Media Pvt. Ltd
30
A No. 2591/MUM/2025
sing Officer has ly and following the order of the ng to substitute adopted by the ucceeds on this eciation on Voot ted that the Ld.
n on intangible he same as part n Voot Platform assessment year any change in ar 2016-17 and ot Platform is on nd therefore his not apply to the of principle of stified.
ard of losses to dispute are that e claimed carry in its return of income. During the dated 17.09.2022, th wise disclosure mad
Income-tax Return.
In 3612/Mum/2019, w business loss claime not a business loss. B was business loss or a statutory right of year and whether or income of subsequen
Via
ITA course of assessment proceedi he Assessing Officer sought expl de in schedule of carry forward
In response a detailed reply
.09.2022 giving year wise utiliza ses and balance carry forward b h the details, the Assessing O rward losses. The Ld. PCIT has n done with respect to the cor ard losses and directed the Asse per law. The Ld. counsel fo bility for carry forward losses academic and same has to be which the set off is claimed. I the decision of Hon'ble Suprem n Das (Deceased) [1966] 59 ITR dia
(P)
Ltd.
V.
DCIT
(20
herein the AO did not allow ca d by the Assessee, alleging tha
Before deciding the issue as to w not, the Hon'ble Supreme Cou an assessee to carry forward r not such loss is eligible to nt year is to be determined by acom 18 Media Pvt. Ltd
31
A No. 2591/MUM/2025
ings vide notice lanation on year d losses as per was filed vide ation of brought business losses.
Officer expressly alleged that no rrectness of the essing Officer to or the assessee in the year of e decided by the In this respect, me Court in case
699 (SC); Cargo
021)
ITA
No.
rry forward of a at the same was whether the loss rt held that it is to the following set-off with the y the AO in the year of set-off. The re under -
“Whether the carried forwa the profits an vocation und
ITO who de year. It is fo subsequent previous yea year. A deci loss in the p cannot be se year is not bi
Following the a Mumbai, in case
DCIT [2021] ITA No.
u/s. 263 denying th holding that the ob carried forward do no 12. We have heard view that actual reve year of set off of su
Via
ITA elevant extract of the decision is e loss of profits or gains in any ard to the following year and s nd gains of the same business, der section 24(2) has to be deter als with the assessment of th r the ITO dealing with the asse year to determine whether th ar may be set off against the p ision recorded by the ITO who revious year under section 24(3
et off against the income of th inding on the assessee".
above decision, The coordinate of Cargo Service Centre Ind
3612/Mum/2119, had also qu he carry forward of losses to s bservations about the eligibility ot affect the interests of the asse rival submissions of the parties nue impact for adjustment of lo uch loss against the year in acom 18 Media Pvt. Ltd
32
A No. 2591/MUM/2025
s reproduced as y year may be set off against
, profession or rmined by the he subsequent essment in the he loss of the profits of that computes the 3) that the loss he subsequent
Bench of ITAT dia (P) Ltd V.
uashed revision subsequent year y of loss being essee.
s. We are of the oss arises in the which profit is available and the AO profit. Thus as far as is concerned, it is no therefore, one of the not fulfill. Therefore, aside the order is un the order of the Ld grounds on merit is aside the order of the 13. In the result, th
Order pronoun (RAJ KUMAR C
JUDICIAL M
Mumbai;
Dated: 27/11/2025
Dragon Legal/Rahul Sharma, Sr. P.S.
Copy of the Order forward
1. The Appellant
2. The Respondent.
3. CIT
4. DR, ITAT, Mumbai
5. Guard file.
////
Via
ITA
O allow set off of such loss a s wrong or unverified of the carry ot prejudicial to the interest of th condition required for invoking action of the Ld. PCIT on this i nwarranted. In view of the afores
. PCIT both on the legal grou s not sustainable in law. Acco e Ld. CIT(A).
he appeal of the assessee is allow ced in the open Court on 27/
- CHAUHAN)
(OM PRAK
MEMBER
ACCOUNTA ded to :
BY ORDER
(Assistant Re
ITAT, Mu acom 18 Media Pvt. Ltd
33
A No. 2591/MUM/2025
against available y forward losses he Revenue and g section 253 is issue for setting said discussion, unds as well as ordingly, we set wed.
11/2025. d/-
KASH KANT)
ANT MEMBER
R, gistrar) umbai