V.A. ADVISORY SERVICES PVT. LTD.,SURAT vs. THE ACIT, CIRCLE-4, SURAT

ITA 2434/AHD/2015Status: DisposedITAT Surat14 November 2018AY 2011-129 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee had purchased the business as a going concern for a lump sum consideration. Since depreciation on goodwill was allowed in earlier years and is allowable as a capital asset, the disallowance by the lower authorities was unjustified.

What were the facts?

The assessee company acquired a running business on a slump sale basis. The Assessing Officer (AO) disallowed depreciation claimed on goodwill, viewing the transaction as a sale of specific assets rather than a going concern. The CIT(A) upheld this disallowance.

What were the issues?

Whether depreciation on goodwill is allowable on the purchase of a business as a going concern, and whether the transaction qualified as a slump sale.

Which sections of the Income-tax Act were involved?

Section 32(1)(ii),Section 143(3),Section 234A,Section 234B,Section 234C,Section 234D,Section 271(1)(c)

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Income Tax Appellate Tribunal, SURAT BENCH, SURAT

Before: SHRI C.M.GARG & SHRI O.P.MEENA

Hearing: 14.11.2018

PER O. P. MEENA, ACCOUTANT MEMBER:

1.

This appeal filed by the Revenue is directed against the order of learned Commissioner of Income Tax (Appeals)-II, Surat(in short “the CIT (A)”) dated 11.05.2015 pertaining to Assessment Year 2011-12 which in turn has arisen from the order passed by the Assistant Commissioner of Income Tax, Circle-4, Surat(in short

VA Advisory Services Pvt.

The order continues below.

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