SUZLON ENERGY LTD.,,AHMEDABAD vs. THE DY. COMMISSIONER OF INCOME TAX CIRCLE-4(1)(1), AHMEDABAD

ITA 199/AHD/2023Status: DisposedITAT Ahmedabad12 November 2024AY 2017-18Bench: Shri T.R. SENTHIL KUMAR (Judicial Member), Shri Makarand Vasant Mahadeokar (Accountant Member)67 pages
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What did the Tribunal hold?

The Tribunal held that goodwill created as a result of amalgamation is a depreciable asset, as it came into existence due to the amalgamation itself, not a transfer of an existing asset. The Tribunal also noted that amendments to Section 32, effective from AY 2021-22, do not apply to the assessment years in question.

What were the facts?

The assessee company claimed depreciation on goodwill arising from an amalgamation. The Assessing Officer (AO) disallowed this claim, arguing that goodwill is not a depreciable asset and the provisions regarding transfer of assets in amalgamation applied. The assessee also suo motu disallowed a small amount under Section 14A, but the AO made a larger disallowance.

What were the issues?

Whether depreciation is allowable on goodwill created as a result of amalgamation, and whether disallowance under Section 14A is applicable to book profits computed under Section 115JB.

Which sections of the Income-tax Act were involved?

Section 14A,Section 32,Section 115JB

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Income Tax Appellate Tribunal, AHMEDABAD “D” BENCH

Before: Shri T.R. SENTHIL KUMAR & Shri Makarand Vasant Mahadeokar

For Appellant: Shri Soumitra Choudhary, A.R
For Respondent: Shri Prithviraj Meena, CIT-DR

PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:- These cross appeals are filed by the Assessee and the Revenue as against separate appellate orders both dated

28.02.

2023 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short refe

The order continues below.

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