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Income Tax Appellate Tribunal, “G” Bench, Mumbai
Before: Shri S. Rifaur Rahman & Shri Ravish Sood
O R D E R PER RAVISH SOOD, JM
The captioned appeals filed by the assessee company are directed against the respective orders passed under Sec. 263 of the Income Tax Act, 1961 (for short „Act‟) by the Principal Commissioner of Income Tax-8, Mumbai (for short „ Pr.CIT‟), dated 30.03.2019 for A.Y. 2014-15 and A.Y. 2015-16. As a common issue is involved in the aforesaid appeals, therefore, the same are being taken up and disposed off by way of a consolidated order. We shall first advert to the appeal filed by the assessee for A.Y. 2014-15. The assessee has assailed the impugned order on the following grounds of appeal before us:-
“1. The order of the Principal Commissioner of Income Tax-8 („the Pr.CIT‟) dated 30 Mar 2019, Mumbai passed under section 263 of the Income Tax Act, 1961 („the Act‟) in so far as it is against the Appellant is opposed to law, equity, weight of evidence, probabilities and the facts and circumstances in the Appellant‟s case.
P a g e | 2 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 2. The Assessing Officer („AO‟) has passed an order in accepting the submissions of the Appellant after verifying various evidences & facts produced before. Thus there is no error, much less an error, prejudicial to the interests of the Revenue to warrant a revision u/s 263 and therefore the order passed by the Pr.CIT in ultravires the provisions of Section 263 and requires to be cancelled under the facts and circumstances of the Appellant‟s case.
3. The Pr.CIT failed to appreciate the facts that the Appellant had filed the details of amount of 25% depreciation claimed on goodwill arising out of amalgamation of a company with the Appellant Company and the claim made was well within the provision of the section 32 of the Act.
4. Without prejudice, the Pr.CIT ought to have dropped the revisional proceedings u/s 263 after considering the submissions made by the appellant, both on legal issues as well as merits, in response to the show cause notice issued u/s 263.
5. The appellant crave leave to add, alter, delete or substitute any of the grounds urged above.
6. In the view of the above and other grounds that may be urged at the time of the hearing of the appeal, the appellant prays that the appeal may be allowed in the interest of justice and equity.”
2. Briefly stated, the assessee company which is engaged in the business of trading in cloth had e-filed its return of income for A.Y. 2014-15 on 26.11.2015, declaring a total loss of Rs. (-) 364,94,74,322/-. Subsequently, the assessee filed a revised return of income on 23.06.2015, declaring the same loss of Rs. (-) 364,94,74,322/-. Thereafter, the case of the assessee was selected for scrutiny assessment under Sec. 143(2) of the Act.
3. The A.O after necessary deliberations assessed the loss of the assessee company at Rs. (-)36,75,90,370/-, vide his order passed under Sec. 143(3), dated 23.12.2016.
The Pr.CIT after culmination of the assessment proceedings called for the records of the assessee. On a perusal of the records, it was observed by the Pr.CIT that during the year under consideration there was a merger of a company that is M/s Premier Finance and Trading Company Limited with the assessee company. As observed by him, the assessee had claimed depreciation on „goodwill‟ amounting to Rs. 36,32,27,725/-, which was accepted by the A.O while framing the assessment. Observing, that the aforesaid claim of the assessee prima facie warranted an in depth enquiry under the „Proviso 5‟ of Sec. 32(1) of the Act, which however was not done by the A.O, the Pr.CIT was of the view that the same had thus rendered the order passed by the A.O as erroneous insofar it was prejudicial to the interest of the revenue within the meaning of Sec. 263 of the Act. On the basis of his aforesaid observations, the Pr.CIT, vide a „show cause‟ notice under Sec. 263, dated 14.03.2019, therein called upon the assessee to P a g e | 3 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 justify its entitlement towards claim of depreciation on „goodwill‟ as per the „Proviso 5‟ of Sec. 32(1). In reply, it was submitted by the assessee that as the aspect pertaining to its entitlement towards claim of depreciation on „goodwill‟ was examined by the A.O in the course of the assessment proceedings, and the same only after necessary deliberations was accepted by him, therefore, the exercise of revisional jurisdictional under Sec. 263 in respect of the said issue was clearly ousted. Apart therefrom, it was submitted by the assessee that its claim for depreciation on „goodwill‟ generated in the course of amalgamation was in conformity with the judgment of the Hon‟ble Supreme Court in the case of CIT, Kolkata Vs. Smifs Securities Limited [Civil Appeal No. 5961 of 2012 (arising out of SLP(C) No. 35600 of 2009), dated 22.08.2012]. Also, support was drawn by the assessee from the order of the ITAT, Pune in the case of The Cosmos Co-op Bank Limited Vs. Dy.CIT, Circle 7, Pune [ITA No. 460 & 461/PN/2012, dated 23.01.2014]. It was submitted by the assessee that as the amount of the „goodwill‟ was the value of the liability in excess of the assets for which the shares were allotted or exchanged on the merger, as per the courts approval, therefore, it could not be said that there was no price or consideration for the same. However, the aforesaid explanation of the assessee did not find favour with the Pr. CIT. The Pr.CIT was of the view that the introduction by the assessee of the balancing figure of excess of liabilities over the assets as „goodwill‟ and claiming depreciation on the same under the Act was in violation of „Proviso 5‟ of Sec. 32(1), and hence was not tenable. Observing, that the A.O had totally ignored the „Proviso 5‟ of Sec. 32(1) and accepted the claim of depreciation on „goodwill‟ as raised by the assessee, the Pr.CIT was of the view that the same had rendered his order as erroneous and prejudicial to the interest of the revenue. Accordingly, the Pr.CIT, vide his order passed under Sec. 263, dated 30.03.2019 „set aside‟ the assessment order with a direction to the A.O to redo the assessment after keeping in view the proviso to Sec. 32(1) and therein disallow the assesses claim of depreciation on „goodwill‟.
Aggrieved, the assessee has assailed the order passed by the Pr.CIT under Sec. 263, dated 30.03.2019 in appeal before us. The Learned Authorized Representative (for short „A.R‟) for the assessee at the very outset of the hearing of the appeal submitted that as the assesses claim of depreciation on „goodwill‟ was examined by the A.O in the course of the assessment proceedings, and was only after necessary deliberations accepted by him, therefore, the Pr.CIT
P a g e | 4 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 had exceeded his jurisdiction and sought a review of the order under Sec. 263 of the Act. In support of his contention that now when the A.O had while accepting the assesses claim of depreciation on „goodwill‟, had taken a possible view, therefore, the jurisdiction of the Pr.CIT to revise the said order under Sec. 263 was ousted, the Ld. A.R relied on the judgment of the Hon‟ble Supreme Court in the case of Malabar Industrial Company (2000) 243 ITR 83 (SC) and CIT Vs. Max India Limited (2007) 295 ITR 282 (SC). Also, reliance was placed by the Ld. A.R on the judgment of the Hon‟ble High Court of Bombay in the case of CIT Vs. Gabriel India Limited (1993) 203 ITR 108 (Bom). Further, the Ld. A.R in order to fortify his aforesaid contention had also relied on the order of the ITAT “D” Bench, Mumbai in the case of Shri Narayan Tatu Rane Vs. ITO Ward-27(1)(1), Mumbai [ITA No. 2690 & 2691/Mum/2016, dated 06.05.2016] (copy placed on record). Further, it was submitted by the Ld. A.R that the entitlement of the assessee towards claim of depreciation on „goodwill‟ which represented the excess consideration paid by the assessee over the value of net assets pursuant to the scheme of amalgamation approved by the Hon‟ble High Court of Bombay, vide its order dated 29.09.2013, was well in conformity with the settled position of law. In order to drive home his aforesaid contention, the Ld. A.R had drawn support from the judgment of the Hon‟ble Supreme Court in the case of CIT, Kolkata Vs. Smifs Securities Limited (2012) 348 ITR 302(S.C) and the order of the ITAT, Pune in the case of The Cosmos Co-op Bank Limited Vs. Dy.CIT, Circle 7, Pune [ITA No. 460 & 461/PN/2012, dated 23.01.2014] (copies placed on record). On the basis of his aforesaid contentions, it was averred by the Ld. A.R that as the Pr.CIT had exceeded his jurisdiction under Sec. 263 for dislodging a balanced and well reasoned view taken by the A.O while framing the assessment under Sec. 143(3), therefore, his order may be „set aside‟ and that of the A.O be restored.
Per contra, the Learned Departmental Representative (for short „D.R‟) relied on the order passed by the Pr.CIT under Sec. 263 of the Act. It was submitted by the Ld. D.R, that as the A.O had failed to make any enquiry as regards the entitlement of the assessee towards claim of depreciation on „goodwill‟ as per the „Proviso 5‟ of Sec. 32(1) of the Act, therefore, the Pr.CIT had rightly „set aside‟ his order with a direction to redo the assessment after disallowing the aforesaid claim for depreciation raised by the assessee. It was further submitted by the Ld. D.R, that as the „goodwill‟ was not reflected as an „intangible asset‟ in the „balance sheet‟ of the P a g e | 5 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 amalgamating company, therefore, the assessee as per the „Proviso 5‟ of Sec. 32(1) was disentitled from raising any depreciation on the same. It was further submitted by the Ld. D.R, that the Pr.CIT remaining well within his jurisdiction had rightly revised the assessment order passed by the A.O under Sec. 143(3), dated 23.12.2016. On the basis of his aforesaid submissions, it was the claim of the Ld. D.R, that as the appeal of the assessee was devoid and bereft of any merit, therefore, the same was liable to be dismissed.
We have heard the authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record, as well as the judicial pronouncements relied upon by them. As is discernible from the records, the Hon‟ble High Court of Bombay vide its order dated 20.09.2013 had sanctioned the scheme of amalgamation u/ss. 391 to 394 r.w.s. 94/97 and Schedule X of the Companies Act, 1956 between M/s Premier Finance & Trading Company Limited (hereinafter referred to as „amalgamating company‟) and the assessee company. As per the scheme of amalgamation the assets and liabilities of the amalgamating company viz. M/s Premier Finance & Trading Company Limited were transferred to and stood vested with the assessee company from the appointed date i.e. 01.04.2013. As the amalgamation was accounted for under the „Purchase Method‟ prescribed by „Accounting Standard 14‟, accordingly the assets and liabilities of the amalgamating company were taken over at their fair values. On a perusal of the “Notes” forming part of the financial statements of the assessee company for the year under consideration, we find, that the assets and liabilities which were acquired by it on amalgamation, and also the treatment of the difference between the net assets acquired and cost of investment by the assessee company in the transferor company together with the shares issued to the minority share holders was reflected as under :
(a) Assets taken over (Amount in Rs.) Fixed Assets 3,918 Investments 11,21,17,02,327 Loans & Advances 4,10,24,12,288 Trade Receivables 7,32,57,676 Stock-in-hand 77,01,373 Cash & Bank Balances 13,17,758 Total (a) 15,39,63,95,340 (b) Liabilities taken over Loans taken 7,84,22,17,894 Other Liabilities & Provisions 1,21,63,97,420 Share Application Money received 1,11,37,65,000
P a g e | 6 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 Total (b) 10,17,23,80,314 (c) Investments in Equity shares of Amalgamating Companies 1,00,000 (d) Issue of Preference shares to share holders of transferring Company as a purchase 7,41,900 consideration (e) Inter Company Balances 6,67,60,84,027 Capital Reserve / (Goodwill) on Amalgamation (a-b-c-d-e) 1,45,29,10,901 As per the records, the assessee company had amortised the entire amount of „goodwill‟ created pursuant to the scheme of amalgamation with M/s Premier Finance Trading Co. Pvt. Ltd. as approved by the Hon‟ble High Court of Bombay, vide its order dated 20.09.2013, in the first year of creation.
As is discernible from the records, the A.O vide his notice dated 14.09.2016 had called upon the assessee to justify its claim of depreciation. Also, the A.O had directed the assessee to furnish the details about scheme of amalgamation viz. (i) last two years copies of returns of the amalgamated company along with computation, balance sheets, audit reports, profit & loss accounts; (ii) copy of scheme of amalgamation as approved by court; (iii) separate balance sheet with profit & loss account as on the date of merger of both the amalgamated company; (iv) balance sheet with profit & loss account as on the date of merger of the merged company; and (v) details of assets acquired on amalgamation. It is the claim of the assessee, that as the A.O had enquired about the eligibility of the assessee towards claim of depreciation on „goodwill‟ and had after necessary deliberations finding the same to be in order had accepted the same, therefore, the Pr.CIT was not vested with any jurisdiction under Sec. 263 to dislodge the aforesaid view so taken by the A.O. Also, as observed by us hereinabove, it is the claim of the assessee that no infirmity emerges from its claim of depreciation on „goodwill‟ which was well in conformity with the provisions of Sec. 32(1) of the Act.
We have given a thoughtful consideration to the issue before us and find substantial force in the claim of the assessee. As observed by the Hon’ble Supreme Court in the case of CIT, Kolkata Vs. Smifs Securities Limited (2012) 348 ITR 302(S.C) „goodwill‟ is an asset under „Explanation 3(b)‟ to Sec. 32(1) of the Act. It was observed by the Hon‟ble Apex Court, that a reading of the words „any other business or commercial rights of similar nature‟ in clause
P a g e | 7 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 (b) of „Explanation 3‟ indicates that „goodwill‟ would fall under the expression „any other business or commercial right of a similar nature‟. It was observed by the Hon‟ble Court that the principle of ejusdem generis would strictly apply while interpreting the aforesaid expression which finds place in „Explanation 3(b)‟ to Sec. 32(1) of the Act. In the case before the Hon‟ble Apex Court, pursuant to the scheme of amalgamation of M/s YSN Shares and Securities (P) Ltd. with M/s Smifs Securities Ltd. which was duly sanctioned by the Hon‟ble High Courts of Bombay and Calcutta with retrospective affect from 01.04.1998, the assets and liabilities of M/s YSN Shares & Securities Pvt. Ltd. were transferred to and stood vested with M/s Smifs Securities Ltd. In the process „goodwill‟ had arisen in the books of M/s Smifs Securities Ltd. It was the claim of the assessee that the excess consideration paid over the value of net assets acquired of M/s YSN Shares & Securities (P) Ltd [amalgamating company] should be considered as „goodwill‟ arising on amalgamation. Infact, it was the claim of the assessee that the extra consideration was paid towards the reputation which the amalgamating company i.e. M/s YSN Shares & Securities Pvt. Ltd. was enjoying in order to retain its existing clientele. However, the A.O declined the assessee claim for deprecation for two fold reasons viz (i) that, the „goodwill‟ as per him was not an asset falling under „Explanation 3‟ to Sec. 32(1) of the Act; and (ii) that, no amount was actually paid by the assessee on account of „goodwill‟. As observed by us hereinabove, the Hon‟ble Apex Court had negated the first observation of the A.O and had held that „goodwill‟ is an asset under „Explanation 3(b)‟ to Sec. 32(1) of the Act. As regards the second observation of the A.O, the Hon‟ble Apex Court did not find any infirmity with the view taken by the lower authorities, which had approved the claim of the assessee that the difference between the cost of the assets and the amount paid constituted „goodwill‟ which the assessee company had acquired in the process of amalgamation. In sum and substance, the Hon‟ble Apex Court had approved the assesses claim for depreciation on „goodwill‟. Also, the Hon‟ble Apex Court had not found any infirmity with the view taken by the lower authorities that the excess consideration paid by the assessee over and above the value of net assets acquired of the amalgamating company i.e. M/s YSN Shares & Securities Pvt. Ltd. was to be considered as the value of „goodwill‟ arising on amalgamation.
P a g e | 8 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 10. We find that the assesees claim of depreciation on „goodwill‟ in the case before us falls within the four corners of the judgement of the Hon’ble Supreme Court in the case of CIT, Kolkata Vs. Smifs Securities Limited (2012) 348 ITR 302(S.C). As is discernible from the „Notes‟ forming part of the financial statements of the assessee company before us, the excess consideration of Rs. 145,29,10,901/- paid by the assessee company over the value of net assets acquired of M/s Premier Finance & Trading Company Private Limited (amalgamating company) had been considered as „goodwill‟ arising in the process of amalgamation. On a perusal of the order passed by the Pr.CIT under Sec. 263 of the Act, we find, that he had held the order passed by the A.O as erroneous for two fold reasons viz. (i) that, as per „Proviso 5‟ to Sec. 32(1), what the merged entity can claim as depreciation consequent to amalgamation/merger can at the most be the arithmetic sum of depreciation claimed by the two merging companies prior to amalgamation and cannot be more consequent to merger; and (ii) that, the introduction of the balancing figure of excess of liabilities over the assets as „goodwill‟ and treating it as tangible assets and claiming depreciation on the same under the Income Tax Act was in violation of „Proviso 5‟ to Sec. 32(1). In our considered view, the aforesaid observations of the Pr.CIT are absolutely misconceived and in contradiction of the judgment of the Hon‟ble Supreme Court of in the case of Smifs Securities Ltd. (supra). On a perusal of „Proviso 5‟ to Sec. 32(1), we find that the same is only in the nature of a rider which inter alia disentitles the amalgamating company and the amalgamated company in the case of amalgamation to claim depreciation on tangible assets or intangible assets, the aggregate of which would exceed the claim of such deduction as per the prescribed rates in case the amalgamation had not taken place. Apart therefrom, it is therein envisaged that the claim for such deduction for depreciation on assets shall be inter alia apportioned between the amalgamating company and the amalgamated company in the ratio of the number of days for which the assets were used by them. In our considered view, in the case before us the „goodwill‟ had arisen in the books of the assessee company in the course of the process of the scheme of amalgamation of M/s Premier Finance Trading Company Private Limited with the assessee company, that was approved by the Hon‟ble High Court of judicature at Bombay, vide its order dated 20.09.2013, pursuant whereto the assets and liabilities of the amalgamating company were transferred to and vested with the assessee company from the appointed date i.e. 01.04.2013. In our considered view, the aforesaid claim of depreciation raised by the P a g e | 9 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 assessee on the value of „goodwill‟ is in conformity with the judgment of the Hon‟ble Supreme Court in the case of M/s Smifs Securities Ltd. (supra). Also, we are unable to comprehend as to how the aforesaid claim of depreciation raised by the assessee is found to be in violation of „Proviso 5‟ to Sec. 32(1) of the Act. Further, we find that the claim of the assessee towards depreciation on „goodwill‟ which was acquired in process of amalgamation is also fortified by the order of a coordinate bench of the Tribunal viz. ITAT, Pune Bench “A”, Pune in the case of The Cosmos Co-op Bank Limited Vs. Dy.CIT, Circle 7, Pune [ITA No. 460 & 461/PN/2012, dated 23.01.2014]. Be that as it may, in our considered view, as the A.O in the course of the assessment proceedings had examined the assesees entitlement towards claim of depreciation on „goodwill‟, and had only after necessary deliberations finding the same to be in order had accepted the same, therefore, the Pr.CIT in exercise of the powers vested with him under Sec. 263 of the Act, was divested of his jurisdiction for seeking dislodging of the aforesaid possible, or infact a balanced and a reasonable view taken by the A.O. Our aforesaid observation that a possible view arrived at by the A.O after necessary deliberations cannot be dislodged by the CIT/Pr.CIT in exercise of revisional jurisdiction under Sec. 263 is fortified by the judgments of the Hon‟ble Supreme Court in the case of Malabar Industrial Company (2000) 243 ITR 83 (SC) and CIT Vs. Max India Ltd (2007) 295 ITR 282 (SC). Also, support his drawn from the judgments of the Hon‟ble High Court of Bombay in the case of Grasim Industries Ltd. Vs. CIT (2010) 321 ITR 92 (Bom) and CIT Vs. Gabriel India Ltd (1993)203 ITR 108 (Bom). Accordingly, not being able to persuade ourselves to subscribe to the view taken by the Pr.CIT that the order passed by the A.O under Sec. 143(3), dated 23.12.2016 was erroneous insofar it was prejudicial to the interest of the revenue, we „set aside‟ his order and restore the order passed by the A.O.
The appeal filed by the assessee is allowed in terms of our aforesaid observations.
ITA No. 3082/Mum/2019 A.Y. 2015-16
We shall now advert to the appeal of the assessee for A.Y. 2015-16. The assessee has assailed the impugned order passed by the Pr.CIT under Sec. 263, dated 30.03.2019 on the following grounds of appeal raised before us :
P a g e | 10 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 “1. The order of the Principal Commissioner of Income Tax-8 („the Pr.CIT‟) dated 30 Mar 2019, Mumbai passed under section 263 of the Income Tax Act, 1961 („the Act‟) in so far as it is against the Appellant is opposed to law, equity, weight of evidence, probabilities and the facts and circumstances in the Appellant‟s case.
The Assessing Officer („AO‟) has passed an order in accepting the submissions of the Appellant after verifying various evidences & facts produced before. Thus there is no error, much less an error, prejudicial to the interests of the Revenue to warrant a revision u/s 263 and therefore the order passed by the Pr.CIT in ultravires the provisions of Section 263 and requires to be cancelled under the facts and circumstances of the Appellant‟s case.
The Hon. Pr.CIT failed to appreciate the facts that the Appellant had filed the details of amount of 25% depreciation claimed on goodwill arising out of amalgamation of a company with the Appellant Company and the claim made was well within the provision of the section 32 of the Act.
4. Without prejudice, the Pr.CIT ought to have dropped the revisional proceedings u/s 263 after considering the submissions made by the appellant, both on legal issues as well as merits, in response to the show cause notice issued u/s 263.
5. The appellant crave leave to add, alter, delete or substitute any of the grounds urged above.
6. In the view of the above and other grounds that may be urged at the time of the hearing of the appeal, the appellant prays that the appeal may be allowed in the interest of justice and equity.”
Briefly stated, the assessee company had e-filed its return of income for A.Y. 2015-16 on 27.09.2015, declaring a total loss of Rs. (-) 175,34,59,933/-. Subsequently, the case of the assessee was selected for scrutiny assessment under Sec. 143(2) of the Act.
The A.O after necessary deliberations assessed the loss of the assessee company at Rs. (-)27,15,92,700/-, vide his order passed under Sec. 143(3), dated 31.03.2017.
The Pr.CIT after culmination of the assessment proceedings called for the records of the assessee. On a perusal of the records, it was observed by the Pr.CIT that the A.O while framing the assessment had failed to examine the assesses claim for depreciation of Rs. 36,32,27,725/- on „goodwill‟ arising on amalgamation of M/s Premier Finance & Trading Company Ltd. (amalgamating company), in light of „Proviso 5‟ of Sec. 32(1) of the Act. Observing, that the order passed by the A.O under Sec. 143(3), dated 31.03.2017 was erroneous insofar it was prejudicial to the interest of the revenue, the Pr.CIT had „set aside‟ his
P a g e | 11 & 3082/Mum/2019 A.Y. 2014-15 & 2015-16 Sprit Infrapower and Multiventures Pvt. Ltd .Vs. Pr.CIT 8 order and directed him to reframe the assessment keeping in view the proviso to Sec. 32(1) and disallow the assesses claim for depreciation on „goodwill‟.
Aggrieved, the assessee has assailed the order passed by the Pr.CIT under Sec. 263, dated 30.03.2019 in appeal before us. At the very outset of the hearing of the appeal, it was submitted by the authorized representatives for both the parties that the facts and the issue involved in the present appeal remains the same as was there in the appeal of the assessee for the immediately preceding year viz. A.Y. 2014-15 in . As the facts and the issue involved in the present appeal remains the same as were there before us in the appeal of the assessee for A.Y. 2014-15 in therefore, our order therein passed shall apply mutatis mutandis for the purpose of disposal of the present appeal of the assessee for A.Y. 2015-16 in ITA No. 3082/Mum/2019. Accordingly, in terms of our observations recorded while disposing off the appeal of the assessee for A.Y. 2014-15 in ITA No. 3081/Mum/2019, the present appeal of the assessee is allowed. Order passed by the Pr.CIT under Sec. 263, dated 30.03.2019 is „set aside‟ and that passed by the A.O under Sec. 143(3), dated 31.03.2017 is restored.
The appeal filed by the assessee is allowed in terms of our aforesaid observations.
The appeals of the assessee for A.Y. 2014-15 in A.Y. 2015-16 in are both allowed in terms of our aforesaid observations.
Order pronounced in the open court on 11.12.2019