ASSISTANT COMMISSIONER OF INCOME TAX, INDORE vs. COMMANDER INDUSTRIES PRIVATE LIMITED, INDORE

ITA 24/IND/2024Status: DisposedITAT Indore25 October 2024AY 2020-2127 pages
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What did the Tribunal hold?

The Tribunal held that goodwill arising from amalgamation is an eligible intangible asset for depreciation. The claim was allowed based on Supreme Court precedents which established goodwill as a business or commercial right of a similar nature.

What were the facts?

The assessee company claimed depreciation on goodwill arising from an amalgamation. The Assessing Officer denied this claim, stating goodwill was not in the books of the amalgamating companies. The CIT(A) allowed the claim, relying on Supreme Court judgments.

What were the issues?

Whether depreciation is allowable on goodwill arising from an amalgamation, and if goodwill qualifies as an intangible asset under Section 32 of the Income Tax Act.

Which sections of the Income-tax Act were involved?

Section 32,Section 43(1),Section 43(6)(c),Section 47(vi)

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Cases cited in this judgment(13)Show list

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Heard together (2 matters)

ITANo.24/Ind/2024
CO No.12/Ind/2024

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Cause title — parties, addresses and appearances
ITANo.24/Ind/2024 & CO No.12/Ind/2024 Commander Industries Private Ltd.

PER VIJAY PAL RAO, JM : This appeal by revenue and CO by the Assessee are directed against the order dated 15.11.2023 of the Commissioner of Income Tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi for A.Y.2020-21. The revenue has raised following grounds of appeal: “1.Whether on the bets and circumstances of the case, the (TRA) is correct in allowing the difference of book value and purchase consideration as goodwill which has neither been purchased nor generated but is merely accounting entry.

2.

"Whether on the facts and circumstances of the case and in law, the CIT(A) is correct in placing reliance on the decision of the Hon'ble Supreme Court in the case of CIT Vs Smifs Securities Ltd

3.

Any other ground that may he urged during the course of appellate proceedings." The assessee is Private Limited Company and engaged in the business of manufacturing, purchase and sale of various edible food materials like aata, maida, rava, suj, bran & refraction etc. Apart from its manufacturing and trading activities the assessee is also engaged in the business of generation and distribution of power throu

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