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Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI INTURI RAMA RAO & SHRI PARTHA SARATHI CHAUDHURY
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER आयकर अपील सं. / ITA Nos.592 & 593/PUN/2019 िनधा�रण वष� / Assessment Years : 2013-14 & 2014-15 Danfoss Power Solutions India Vs. DCIT, Circle-1(2), Pune. Pvt. Ltd., Gate No.94-100, High Cliff Industrial Estate, Wagholi Rahu Road, Village- Kesnand, Pune- 412207. PAN : AAFCS2954P Appellant Respondent Assessee by : Shri Nikhil S. Pathak Revenue by : Shri Ramnath P. Murkunde Date of hearing 22.11.2022 : Date of pronouncement 01.12.2022 : आदेश / ORDER PER INTURI RAMA RAO, AM: These are the appeals filed by the assessee directed against the separate orders of ld. Commissioner of Income Tax (Appeals)- 1, Pune [‘the CIT(A)’] dated 04.02.2019 for the assessment years 2013-14 and 2014-15 respectively. 2. Since the identical facts and common issues are involved in both the above captioned appeals, we proceed to dispose of the same by this common order.
2 ITA Nos.592 & 593/PUN/2019 3. For the sake of convenience and clarity, the facts relevant to the appeal in ITA No.592/PUN/2019 for the assessment year 2013-14 are stated herein. ITA No.592/PUN/2019, A.Y. 2013-14 : 4. Briefly, the facts of the case are that the appellant is a company incorporated under the provisions of the Companies Act, 1956. It is engaged in the business of trading, assembly and sales service of hydraulic parts and equipment. The Return of Income for the assessment year 2013-14 was filed on 29.11.2013 declaring total income of Rs.13,97,23,090/-. Against the said return of income, the assessment was completed by the Dy. Commissioner of Income Tax, Circle-1(2), Pune (‘the Assessing Officer’) vide order dated 25.11.2016 passed u/s 143(3) r.w.s. 92CA(4) of the Income Tax Act, 1961 (‘the Act’) at total income of Rs.14,15,41,420/-. While doing so, the Assessing Officer disallowed the claim for depreciation on goodwill on the ground that the claim was not made in the return of income and the goodwill is already amortized in the books of accounts. The Assessing Officer also made addition of Rs.18,18,322/- on the ground that the addition on account of
3 ITA Nos.592 & 593/PUN/2019 provision made for the payment of legal professional charges, as the assessee had failed to deduct TDS u/s 194J of the Act. 5. Being aggrieved by the above assessment order, an appeal was filed before the ld. CIT(A) who vide impugned order confirmed the addition on the ground that asset in respect of which depreciation was claimed, was not found in the books of accounts. Similarly, on the issue of disallowance u/s 40(a)(ia), the ld. CIT(A) directed the Assessing Officer to verify the claim of the appellant that the amount disallowed in the assessment year 2012-13, was paid during the previous year relevant to the assessment year 2013-14. 6. Being aggrieved by the decision of the ld. CIT(A), the appellant is in appeal before us in the present appeal. 7. It is submitted that in the earlier years in which the claim was made, the issue of allowability of depreciation was remanded to the file of the Assessing Officer and, therefore, on identical lines, the issue in the present appeal may be remanded to the file of the Assessing Officer. The ld. Sr. DR has no serious objection to remand this issue to the Assessing Officer on similar lines. 8. We order accordingly with direction that the Assessing Officer shall examine the allowability of depreciation keeping in view the provisions of Explanation 5 to section 32 of the Act and also
4 ITA Nos.592 & 593/PUN/2019 examine the actual cost incurred by the appellant. Thus, this ground of appeal stands partly allowed. 9. In the result, the appeal of the assessee in ITA No.592/PUN/2019 for A.Y. 2013-14 stands partly allowed. ITA No.593/PUN/2019, A.Y. 2014-15 : 10. Since in the present appeal, the issue towards allowability of depreciation is identical to the issue as decided by us in the foregoing paragraphs of this order vide ITA No.592/PUN/2019 for A.Y. 2013-14, therefore, our decision in ITA No.592/PUN/2019 for A.Y. 2013-14 on the issue of allowability of depreciation shall apply mutatis mutandis to this ground of appeal. We order accordingly. Hence, this ground of appeal stands partly allowed. 11. In next ground of appeal, the assessee challenges the correctness of decision of the ld. CIT(A) allowing legal and professional expenses u/s 40(a)(ia) of the Act. 12. After hearing both sides and perusing the material on record, we remand this issue in the present appeal to the file of the Assessing Officer with a direction that the Assessing Officer shall allow the legal and professional expenses on being satisfied himself that the expenditure incurred for the assessment year 2013-14 was
5 ITA Nos.592 & 593/PUN/2019 actually paid during the previous year relevant to the assessment year under consideration i.e. A.Y. 2014-15. Thus, this ground of appeal stands partly allowed. 13. In the result, the appeal of the assessee in ITA No.593/PUN/2019 for A.Y. 2014-15 stands partly allowed. 14. To sum up, both the above appeals of the assessee stands partly allowed. Order pronounced on this 01st day of December, 2022. Sd/- Sd/- (PARTHA SARATHI CHAUDHURY) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; �दनांक / Dated : 01st December, 2022. Sujeet आदेश क� �ितिलिप अ�ेिषत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(A)-1, Pune. 4. The Pr. CIT-1, Pune. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, “A” ब�च, 5. पुणे / DR, ITAT, “A” Bench, Pune. गाड� फ़ाइल / Guard File. 6. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.