CIT v. Smifs Securities Ltd.

Asst. Commissioner of Income Tax -7(1)(1), Mumbai vs. Horizon Packs Pvt. Ltd., Mumbai

In the result, appeals by the revenue are dismissed

Bench: Shri Saktijit Dey, Hon'Ble & Shri Narendra Kumar Billaiya, Hon'Ble

…the assets and liabilities taken over and the additional share capital issued in accordance with this scheme is accounted as Goodwill in the books of the assessee. Various courts, including the Supreme Court in the case of CIT v. Smifs Securities Ltd. (2012) 348 ITR 302, have held that Goodwill, being the difference between the purchase price and the value of the assets received, is a depreciable asset under Explanation 3(b) to section 32(1) of the Act. Accordingly, the assessee has considered Goodwill arising on account of the merger as an intangible depreciable asset.” 9. With this factual background, the AO f…

Assistant Commissioner of Income Tax -7(1)(1), Mumbai vs. Horizon Packs Pvt. Ltd., Mumbai

In the result, appeals by the revenue are dismissed

Bench: Shri Saktijit Dey, Hon'Ble & Shri Narendra Kumar Billaiya, Hon'Ble

…TRIBUNAL I.T.A. No. 5950 & 6096/Mum/2024 9 the additional share capital issued in accordance with this scheme is accounted as Goodwill in the books of the assessee. Various courts, including the Supreme Court in the case of CIT v. Smifs Securities Ltd. (2012) 348 ITR 302, have held that Goodwill, being the difference between the purchase price and the value of the assets received, is a depreciable asset under Explanation 3(b) to section 32(1) of the Act. Accordingly, the assessee has considered Goodwill arising on account of the merger as an intangible depreciable asset.” 9. With this factual background, the AO f…

Vishal Furnishing Limited, Mumbai vs. Assistant Commissioner of Income Tax Circle 8(3)(1), Mumbai

Bench: Shri Om Prakash Kant, Am & Ms. Kavitha Rajagopal, Jm Vishal Furnishing Limited Assistant Commissioner Of Income 211, Shiv Shakti Industrial Complex, Tax, Circle 8(3)(1), Mumbai. Vs. Lower Parel, Mumbai – 400011. Pan/Gir No. Aaacr2138K (Appellant) : (Respondent) Assessee By : Shri Rahul Hakkani Respondent By : Shri Vivek Perampurna (Cit Dr) Date Of Hearing : 10.07.2025 Date Of Pronouncement : 01.10.2025 O R D E R Per Kavitha Rajagopal, J M: This Appeal Has Been Filed By The Assessee, Challenging The Order Of The Learned Commissioner Of Income Tax (Appeals) Delhi (‘Ld. Cit(A)’ For Short), National Faceless Appeal Centre (‘Nfac’ For Short) Passed U/S.250 Of The Income Tax Act, 1961 (‘The Act'), Pertaining To The Assessment Year (‘A.Y.’ For Short) 2018-19. 2. The Assessee Has Raised The Following Grounds Of Appeal: 1) The Learned Cit(A) Failed To Appreciate That The Assessment Order Was Passed In Violation Of The Principles Of Natural Justice & Contrary To The Scheme Of Assessment & Hence The Assessment Order Was A Nullity & Deserves To Be Quashed. 2) The Ld Cit(A) Erred In Confirming The Order Of Ao Disallowing Depreciation On Goodwill Of Rs 4,12,73,088/- (As Claimed In Accounts) Without Appreciating That Goodwill Had Arisen On Amalgamation & Was Eligible For Depreciation U/S 32 & Hence The Addition Of Rs 4,12,73,088/-May Be Deleted. Vishal Furnishing Limited

…so relied upon the Tribunal’s decision in the case of United Breweries Ltd. vs. ACIT in ITA No. 722/18 and 1065/Bang/2014 stating that the said decision is not in conflict with the Hon'ble Apex Court decision in the case of CIT vs Smiff Securities Ltd. (2012) 348 ITR 302. The ld. AO then passed the assessment order dated 24.04.2021, thereby determining total income at Rs. 2,99,73,060/- after making addition/disallowance of ‘income from profit and gains’ and ‘income from business or profession’ amounting to Rs. 4,12,73,088/-. 4. Aggrieved the assessee was in appeal before the first appellate authority, challenging…

DCIT, Central Circle-3(2), Mumbai vs. Yola Stays Limited, Mumbai

The appeal of the revenue is dismissed

Bench: Shri Saktijit Dey, Vp & Ms Padmavathy S, Am

…tion towards Long Term Capital Gain (LTCG) under reported to the tune of Rs. 3,444/-. On further appeal the CIT(A) gave relief to the assessee by placing reliance on the decision of the Hon'ble Supreme Court in the case of CIT Vs. Smifs Securities Ltd. [2012] 348 ITR 302 (SC). The revenue is in appeal against the order of the CIT(A). 4. The ld. AR argued that the reasons for the AO to make the addition is based on the suspicion that the goodwill recorded in the books of the assessee is towards the land which according to the AO is the only asset in the books of the amalgamating company. The ld. AR further argued…

Sprit Infrapower & Multiventures Private Limited, Mumbai vs. PCIT-8, Mumbai

The appeal of the assessee is allowed

Bench: Ms Padmavathy S, Am & Shri Raj Kumar Chauhan, Jm

…interest of the revenue. The assessee in response to the show- cause notice issued by the PCIT under section 263 submitted that the issue of depreciation on goodwill is settled by the Hon'ble Supreme Court in the case of Smifs Securities Ltd. vs. CIT [(2012) 348 ITR 302 (SC)] and that the assessee in 3 ITA 1589/Mum/2025 Sprit Infrapower & Multiventures Pvt. Ltd. the books of accounts has written off the goodwill fully. The PCIT did not accept the submissions of the assessee and set-aside the order of the AO by holding that “6. In this regard, reliance is placed on the decision of the ITAT Bangalore Bench in the…

Novateur Electrical and Digital Systems Pvt Ltd., Mumbai vs. Asst CIT 10(3)(1), Mumbai

In the result, appeal of the assessee is partly allowed and that by the Revenue is dismissed

Bench: Smt. Beena Pillai & Shri Girish Agrawalassessment Year: 2012-13

…ounds, we note that goodwill per se is an intangible asset within the meaning of explanation 3 to section 32(1)(ii) and is thus eligible for depreciation. We draw our force from the decision of Hon'ble Supreme Court in the case of SMIFS Securities Ltd. [2012] 348 ITR 302 (SC) wherein it is held that excess consideration paid by it over the value of net assets acquired amounts to goodwill. Further, it was held that goodwill falls within the expression “any other business or commercial right of a similar nature” and is therefore an asset under explanation 3 to section 32(1) and thus eligible for depreciation. 7.1.…

Dy CIT 10(3)(1), Mumbai vs. M/S Novateur Electricals and Digital Systems Pvt Ltd., Mumbai

In the result, appeal of the assessee is partly allowed and that by the Revenue is dismissed

Bench: Smt. Beena Pillai & Shri Girish Agrawalassessment Year: 2012-13

…ounds, we note that goodwill per se is an intangible asset within the meaning of explanation 3 to section 32(1)(ii) and is thus eligible for depreciation. We draw our force from the decision of Hon'ble Supreme Court in the case of SMIFS Securities Ltd. [2012] 348 ITR 302 (SC) wherein it is held that excess consideration paid by it over the value of net assets acquired amounts to goodwill. Further, it was held that goodwill falls within the expression “any other business or commercial right of a similar nature” and is therefore an asset under explanation 3 to section 32(1) and thus eligible for depreciation. 7.1.…

Mahadhan Agritech Limited (Formerly Known As Smartchem Technologies Ltd), Mumbai vs. Assistant Commissioner of Income Tax Central Circle 8(1), Mumbai

In the result, the appeals filed by the assessee are

…decisions rendered by various Courts including Supreme Court on allowability of depreciation on goodwill &/or intangible assets, including inter-alia the below: 46 ITA No.2227/Mum/2024 and others Mahadhan Agritech Limited - CIT v. Smifs Securities Ltd. (2012) 348 ITR 302 (SC) - CIT v. Birla Global Asset Finance Co. Ltd. (2014) 221 Taxman 176 (Bom HC) - JX Nippon Two Lubricants India Pvt. v. DCIT (ITA No. 4985/Del/2019) (Delhi Trib.) - M/s. Merck Specialities Pvt. Ltd. V. ACIT (ITA No.1727/Mum/2017) (Mum. Trib.) 51. Further, the ld. AR pointed out the below specific judicial precedents where depreciation on goodwi…

Mahadhan Agritech Limited (Formerly Known As Smartchem Technologies Limited ), Mumbai vs. Deputy Commissioner of Income Tax, Central Circle -8(1), Mumbai

In the result, the appeals filed by the assessee are allowed, and the appeal filed by the Revenue is dismissed

Bench: SHRI AMIT SHUKLA (Judicial Member), SHRI GIRISH AGRAWAL (Accountant Member)

…d. AR brought to the notice of the Bench plethora of favorable decisions rendered by various Courts including Supreme Court on allowability of depreciation on goodwill &/or intangible assets, including inter-alia the below: CIT v. Smifs Securities Ltd. (2012) 348 ITR 302 (SC) - CIT v. Birla Global Asset Finance Co. Ltd. (2014) 221 - Taxman 176 (Bom HC) - JX Nippon Two Lubricants India Pvt. v. DCIT (ITA No. 4985/Del/2019) (Delhi Trib.) M/s. Merck Specialities Pvt. Ltd. V. ACIT (ITA - No.1727/Mum/2017) (Mum. Trib.) 51. Further, the ld. AR pointed out the below specific judicial precedents where depreciation on goo…

DCIT Central Circle 8(1), Mumbai vs. Mahadhan Agritech Limited, Pune

In the result, the appeals filed by the assessee are allowed, and the appeal filed by the Revenue is dismissed

Bench: SHRI AMIT SHUKLA (Judicial Member), SHRI GIRISH AGRAWAL (Accountant Member)

…d. AR brought to the notice of the Bench plethora of favorable decisions rendered by various Courts including Supreme Court on allowability of depreciation on goodwill &/or intangible assets, including inter-alia the below: CIT v. Smifs Securities Ltd. (2012) 348 ITR 302 (SC) - CIT v. Birla Global Asset Finance Co. Ltd. (2014) 221 - Taxman 176 (Bom HC) - JX Nippon Two Lubricants India Pvt. v. DCIT (ITA No. 4985/Del/2019) (Delhi Trib.) M/s. Merck Specialities Pvt. Ltd. V. ACIT (ITA - No.1727/Mum/2017) (Mum. Trib.) 51. Further, the ld. AR pointed out the below specific judicial precedents where depreciation on goo…