“Section 32(1)”

Section References (mined)Section 32Section 32(1)889 judgments

The decision most relied on for Section 32(1) is CIT v. Smifs Securities Ltd. (348 ITR 302), cited in 540 judgments on BharatTax.

Leading authorities on Section 32(1)

CIT v. Smifs Securities Ltd.

348 ITR 302 · 2012 · Supreme Court

540

citing judgments

Goodwill, whether arising from an amalgamation or a slump sale, is an intangible asset eligible for depreciation under Section 32(1) of the Income-tax Act. While the assessee must prove the existence and valuation of such goodwill, it is recognized as a depreciable asset.

Sahney Steel and Press Works Ltd. v. CIT

228 ITR 253 · 1997 · Supreme Court

429

citing judgments

A subsidy is treated as a revenue receipt if the assessee is free to use the money in its business as it likes and is not obligated to spend it for a specific capital purpose, such as acquiring assets or repaying loans.

Sutlej Cotton Mills Ltd. v. CIT

116 ITR 1 · 1979 · Supreme Court

409

citing judgments

A gain arising from the cancellation of a forward exchange contract entered into for the acquisition of a capital asset constitutes a capital receipt. Income-tax liability for such transactions is determined by the specific provisions of the Income Tax Act, independent of the accounting treatment in the books of account.

Vijaya Bank v. CIT

323 ITR 166 · 2010 · Supreme Court

392

citing judgments

A provision for bad and doubtful debts debited to the profit and loss account and reduced from advances on the balance sheet constitutes a write-off for deduction purposes. This is true even if individual debtor accounts are not closed.

CIT v. Bokaro Steel Ltd.

236 ITR 315 · 1999 · Supreme Court

370

citing judgments

Interest earned during the pre-commencement period of a project, on advances made to contractors or on unutilized borrowed funds, if inextricably linked to the setting up of the plant, constitutes a capital receipt. Such interest is not taxable as income but can be reduced from the capital work-in-progress.

Bajaj Tempo Ltd. v. CIT

196 ITR 188 · 1992 · Supreme Court

289

citing judgments

Provisions in taxing statutes that grant incentives, concessions, or exemptions for promoting economic growth and industrialization must be interpreted liberally and purposively. Any restrictions placed on such provisions should also be construed reasonably to advance their objective, not frustrate it.

ICDS Ltd. v. CIT

350 ITR 527 · 2013 · Supreme Court

280

citing judgments

An assessee engaged in the business of hire purchase or leasing, being the lessor, is entitled to claim depreciation on assets leased out, even if the assets are registered in the name of the lessee and used by the lessee.

Alembic Chemical Works Co. Ltd. v. CIT

177 ITR 377 · 1989 · Supreme Court

275

citing judgments

Expenditure that provides a commercial advantage of an enduring nature may still be classified as revenue expenditure if its purpose is to facilitate existing trading operations, improve business efficiency, or upgrade existing products, depending on the specific context and objective.

Judgments citing Section 32(1)

DCIT, Circle- 20(2), New Delhi vs. Quippo Energy (P) Ltd., New Delhi

In the result, appeal of the Revenue is dismissed

ITA 4120/DEL/2017[2011-12]Status: DisposedITAT Delhi23 Apr 2024AY 2011-12

Bench: Shri Challa Nagendra Prasad & Dr. B.R.R. Kumarआ.अ.सं/.I.T.A No.4120/Del/2017 िनधा"रणवष"/Assessment Year: 2011-12 बनाम Dcit, Quippo Energy (P) Ltd., D-2, 5Th Floor, Southern Park, Circle 20(2), Vs. New Delhi. Saket Place, New Delhi. Pan No. Aaacq1675Q अपीलाथ" Appellant ""यथ"/Respondent

Section 79

appeals are dismissed.” 4.3. In the case of ICDS vs. CIT, 350 ITR 527 (SC), the Hon’ble Apex Court observed that Section 32(1) requires that the assessee must use the asset for the “purposes of business”. It does not mandate usage of the asset by the assessee itself ... long as the asset was utilized for the purpose of business of the assessee, the requirement of Section 32(1) will stand satisfied, notwithstanding, non usage of the asset itself by the assessee. The Hon'ble Court held as under: "Where leasing of machinery is a mode of carrying

Diadora Shoes Pvt Ltd, Calicut vs. ACIT Circle 2(1), Calicut

In the result, the assessee’s appeal is allowed

ITA 92/COCH/2023[2014-15]Status: DisposedITAT Cochin19 Apr 2024AY 2014-15

Bench: Shri Sanjay Arora, Am & Shri Anil Kumar Dugar, Jm

For Appellant: --- None ---For Respondent: Smt.J.M.Jamuna Devi, Sr.DR

Section 250Section 32(1)(iia)

claim of unabsorbed depreciation of Rs.59,000/- in respect of the assets acquired in preceding assessment year i.e. A.Y. 2013- 2014 under section 32(1)(iia) of the Act on the ground that the claim of additional depreciation is admissible only in the year of acquisition of assets and explanation ... claim of unabsorbed depreciation of Rs.59,000/- in respect of the assets acquired in preceding assessment year i.e., A.Y. 2013- 2014 under section 32(1)(iia) of the Act on the basis of following observation:- “2. During the year assessee had made addition of Rs.43181/- for plant and machinery

Genpact Services Llc, Gurgaon vs. ACIT, Circle-1(3)(1), International Taxation, New Delhi

In the result, the appeal of the assessee is allowed

ITA 1833/DEL/2022[2017-18]Status: DisposedITAT Delhi19 Apr 2024AY 2017-18

Bench: Shri M. Balaganesh & Shri Yogesh Kumar U.S.Genpact Services Llc, Vs. Acit, Plot No. 22A & B, Circle-1(3)(1), Sector-18, Udyog Vihar, International Taxation, Gurgaon, Haryana New Delhi (Appellant) (Respondent) Pan: Aaccg3353P

For Appellant: Shri Vishal Kalra, AdvFor Respondent: Shri Rajesh Kumar, CIT DR

Section 92C

income of the Appellant and a corresponding depreciation claim of 25% i.e., Rs. 5,54,00,069 was allowed to the Appellant under section 32(1)(ii) of the Act. Being aggrieved by the aforesaid assessment order passed for AY 2010-11, the Appellant preferred an appeal before

Akar Laminators Limited, Ahmedabad vs. Deputy Commissioner of Income Tax, Circle 1(1)(1), Ahmedabad

In the result the appeal filed by the assessee is allowed

ITA 600/AHD/2023[2001-02]Status: DisposedITAT Ahmedabad10 Apr 2024AY 2001-02

Bench: This Tribunal & The Case Was Set-Aside Vide Order Dated 01.08.2014 In Ita No. 858 & 927/Ahd/2005 & Accordingly Assessment Was Finalized U/S. 143(3) R.W.S. 254 Of The Act & The Total Loss Was Determined At (-) Rs.22,47,26,293/- After Making Following Additions/Disallowances:

Section 143(3)Section 144Section 271Section 271(1)(c)Section 274

Penalty - For concealment of income (Disallowance of claim of depreciation) - Assessment year 2011-12 - Assessee claimed additional depreciation for plant and machinery under section 32(1)(iia) on strength of Tax Audit Report - Assessing Officer disallowed claim on ground that production had been started in current year by assessee

Backbone Tarmet Ng Jv, Ahmedabad vs. The Income-Tax Officer, Ward-5(2)(2), Ahmedabad

The appeal of the assessee is allowed in above terms

ITA 315/AHD/2022[2005-06]Status: DisposedITAT Ahmedabad05 Apr 2024AY 2005-06

Bench: Mrs. Annapurna Gupta & Shri T.R. Senthil Kumarassessment Year : 2005-06 Vs. Backbone Tarmet Ng Jv, The Income-Tax Officer, A-9, Kumud Apartment, Ward-5(2)(2), Near Stadium Five Roads, Ahmedabad Navrangpura, Ahmedabad-380009 Pan : Aaaab 3885 F अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri Sakar Sharma, Ca Revenue By : Shri Vipul Chavda, Sr. Dr सुनवाई की तारीख/Date Of Hearing : 28/03/2024 घोषणा की तारीख /Date Of Pronouncement: 05/04/2024 आदेश/O R D E R Per Annapurna Guptapresent Appeal Has Been Filed By The Assessee Against Order Of The Commissioner Of Income-Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Hereinafter Referred To As "Cit(A)" For Short] Dated 20.06.2022 Passed Under Section 250 Of The Income-Tax Act, 1961 [Hereinafter Referred To As "The Act" For Short], For The Assessment Year (Ay) 2005-06. 2. Grounds Raised Are As Under :- “1. The Ld. Cit(A)-Nfac Erred On Facts & In Law In Deciding Appeal Ex- Parte Without Appreciating That Business Of The Appellant Has Been Closed Since Covid-19 & Therefore, In Absence Of Any Office, Notice(S) Claimed To Be Have Been Served Through Email Could Not Be Communicated To The Partners Of The Appellant. Without Prejudice To This It Is Submitted That No Notice(S) Came To Be Served On The Appellant At The Designated Email Stated In Form No. 35 For The Purpose Of Service Of Notice(S). Backbone Tarmet Ng Jv Vs. Ito Ay : 2005-06 2

For Appellant: Shri Sakar Sharma, CAFor Respondent: Shri Vipul Chavda, Sr. DR

Section 139(1)Section 143(3)Section 154Section 234BSection 234DSection 250Section 250(6)Section 40

withdrawn.” Reliance was also placed on the following decision • B.V.K. Seshavataram Vs. CIT, 210 ITR 633 (AP) “Section 256(1) , read with section 32(1)(iv) of the Income-tax Act, 1961 - Reference to High Court - Question of law - Assessment years

Diadora Shoes Pvt Ltd, Calicut vs. ACIT Circle 2(1), Calicut

In the result, the assessee’sappeal is allowed

ITA 213/COCH/2023[2015-16]Status: DisposedITAT Cochin28 Mar 2024AY 2015-16

Bench: Shri Sanjay Arora & Shri Manomohan Dasdiadora Shoes Pvt. Ltd. Asst. Cit, Circle - 2 Vkc Tower, Kolathra P.O Calicut 673001 Vs. Calicut 673655 [Pan:Aabcd9692D] (Appellant) (Respondent)

For Appellant: Shri M.V. Venugopal, CAFor Respondent: Smt. J.M. Jamuna Devi, Sr. D.R

Section 143(3)Section 32(1)(ii)

sole issue arising in the instant appeal is if the amendment by way of insertion of the third proviso to section 32(1)(ii) by Finance Act, 2015, w.e.f. 01.04.2016, is retrospective in nature? While the assessee before us relies on the decisions in the following cases, the Revenue relies ... actual cost of such machinery or plant shall be allowed as deduction under clause (ii) : Provided that…. A third proviso was inserted to section 32(1)(ii) by Finance Act, 2015, w.e.f. 01.04.2016, reading as under: Provided also that where an asset referred to in clause (iia) or the first

M/S Coastal Energen Private Limited, Chennai vs. ACIT, Central Circle-1(1), Chennai

In the result, the appeal stand dismissed

ITA 1483/CHNY/2023[2017-18]Status: DisposedITAT Chennai22 Mar 2024AY 2017-18

Bench: Hon’Ble Shri Mahavir Singh, Vp & Hon’Ble Shri Manoj Kumar Aggarwal, Am आयकरअपील सं./ Ita No.1481/Chny/2023 (िनधा*रण वष* / Assessment Year: 2015-16) & आयकरअपील सं./ Ita No.1482/Chny/2023 (िनधा*रण वष* / Assessment Year: 2016-17) & आयकरअपील सं./ Ita No.1483/Chny/2023 (िनधा*रण वष* / Assessment Year: 2017-18) M/S. Coastal Energen Private Limited Acit बनाम No.5, Bhuhari Building, Moores Road, Central Circle-1(1), / Vs. Egmore, Chennai-600 004. Chennai. "थायीलेखासं./जीआइआरसं./Pan/Gir No. Aadcc-0886-G (अपीलाथ"/Appellant) : (" थ" / Respondent) अपीलाथ"कीओरसे/ Appellant By : Shri B. Ramakrishnan (Ca)- Ld. Ar " थ"कीओरसे/Respondent By : Shri N. Balakrishnan (Cit)-Ld. Dr सुनवाईकीतारीख/Date Of Final Hearing : 14-03-2024 घोषणाकीतारीख /Date Of Pronouncement : 22-03-2024 आदेश / O R D E R Manoj Kumar Aggarwal () 1.1 Aforesaid Appeals By Assessee For Assessment Years (Ay) 2015- 16 To 2017-18 Arise Out Of The Common Order Of Learned Commissioner Of Income Tax (Appeals)-18, Chennai [Cit(A)] Dated 31-10-2023 In The Matter Of Separate Assessments Framed By Ld. Assessing Officer [Ao]

For Appellant: Shri B. Ramakrishnan (CA)- Ld. ARFor Respondent: Shri N. Balakrishnan (CIT)-Ld. DR

Section 132Section 143(3)Section 153ASection 32Section 43(6)

case of over-invoicing of the asset and is also related to the relevant assessment year. 3.7 Lastly, as per Section 32(1) of the Income-tax Act, 1961, depreciation is allowed in respect of assets owned, wholly or partly, by the assessee and used for the purposes

M/S Coastal Energen Private Limited, Chennai vs. ACIT, Central Circle-1(1), Chennai

In the result, the appeal stand dismissed

ITA 1482/CHNY/2023[2016-17]Status: DisposedITAT Chennai22 Mar 2024AY 2016-17

For Appellant: Shri B. Ramakrishnan (CA)- Ld. ARFor Respondent: Shri N. Balakrishnan (CIT)-Ld. DR

Section 132Section 143(3)Section 153ASection 32Section 43(6)

M/S Coastal Energen Private Limited, Chennai vs. ACIT, Central Circle-1(1), Chennai

In the result, the appeal stand dismissed

ITA 1481/CHNY/2023[2015-16]Status: DisposedITAT Chennai22 Mar 2024AY 2015-16

For Appellant: Shri B. Ramakrishnan (CA)- Ld. ARFor Respondent: Shri N. Balakrishnan (CIT)-Ld. DR

Section 132Section 143(3)Section 153ASection 32Section 43(6)

Chimera Industrial and Development Private Limited, Mumbai vs. Commissioner of Income Tax (Appeals)-NFAC, Mumbai

In the result, both the appeals of the assessee are allowed in the terms

ITA 2332/MUM/2023[2017-18]Status: DisposedITAT Mumbai19 Mar 2024AY 2017-18

Bench: Justice (Retd.) C.V. Bhadang () & Shri B.R. Baskaran (Am)

For Appellant: a) Disallowance of depreciation on goodwill

Section 143(3)Section 147Section 234B

hold any goodwill, meaning thereby, goodwill was NIL in the hands of the demerged company. As per the 5 proviso to section 32(1) of the Act, depreciation claimed by the demerged company and resulting company shall not exceed the amount of depreciation that would have been allowed

Chimera Industrial and Development Private Limited, Mumbai vs. Commissioner of Income Tax (Appeals)-NFAC, Mumbai

ITA 2331/MUM/2023[2016-2017]Status: DisposedITAT Mumbai19 Mar 2024AY 2016-2017

Bench: Justice (Retd.) C.V. Bhadang () & Shri B.R. Baskaran (Am)

For Appellant: a) Disallowance of depreciation on goodwill

Section 143(3)Section 147Section 234B

Chimera Industrial & Development Pvt. Ltd. IN THE INCOME TAX APPELLATE TRIBUNAL Mumbai “C” Bench, Mumbai. Before Justice (Retd.) C.V. Bhadang

Lupin Ltd., Mumbai vs. The Dy CIT, Circle-3(4), Mumbai

In the result, the appeal of the assessee in I

ITA 77/MUM/2021[2013-14]Status: DisposedITAT Mumbai18 Mar 2024AY 2013-14

Bench: Shri Pavan Kumar Gadale, Jm & Ms Padmavathy S, Am

For Appellant: Shri Rajan Vora, Shri PranayFor Respondent: Ms. Manju Thakur, Sr. DR

Section 10ASection 115JSection 143(3)Section 154Section 271(1)(c)Section 37(1)

Limited deduction claimed through a letter during assessment proceedings towards additional depreciation on assets put to use for less than 180 days under section 32(1)(ii) of the Act and deduction towards leave encashment. The AO also made an addition under section 40(a)(v) of the Act towards ... accounting principles. The question is whether such kinds of goodwill would fall under the category of business or commercial rights as mentioned in section 32(1)(ii) of the Act, which was interpreted by Hon'ble Supreme Court in the case of Smiffs Securities Ltd (supra). Hence it is imperative

Asstt. CIT -Circle-3(4), Mumbai vs. M/S. Lupin Ltd., Mumbai

In the result, the appeal of the assessee in I

ITA 1241/MUM/2021[2013-14]Status: DisposedITAT Mumbai18 Mar 2024AY 2013-14

Bench: Shri Pavan Kumar Gadale, Jm & Ms Padmavathy S, Am

For Appellant: Shri Rajan Vora, Shri PranayFor Respondent: Ms. Manju Thakur, Sr. DR

Section 10ASection 115JSection 143(3)Section 154Section 271(1)(c)Section 37(1)

Publics Communications P.Ltd, Mumbai vs. DCIT Cir 7(3)(2), Mumbai

In the result, ground 2 is allowed and ground 3 is allowed for statistical purposes

ITA 588/MUM/2017[2012-13]Status: DisposedITAT Mumbai15 Mar 2024AY 2012-13

Bench: Ms. Kavitha Rajagopal() & Ms. Padmavathy S. ()

Section 199

assessee is entitled to depreciation on such goodwill being 'business or commercial right of similar nature' in accordance with the provisions of section 32(1 )(ii).” 6. The DRP upheld the disallowance for the same reason as has been stated by the Assessing Officer. The DRP also noted that ... prove that the goodwill so acquired has been put to use by the assessee. The Ld.DR also submitted that the subsequent amendment to section 32(1) of the Act wherein goodwill has been excluded for the purpose of depreciation would have a persuasive value that the intention of the legislature

Balaji Infrastructure & Development Co., Mumbai vs. ITO 2(1)(1), Mumbai

In the result, ground no. 2 raised by the assessee is dismissed in above terms

ITA 1616/MUM/2020[2013-14]Status: DisposedITAT Mumbai11 Mar 2024AY 2013-14

Bench: Shri Aby T Varkey & Shri Gagan Goyalbalaji Infrastructure & Development Company Limited, 6Th Floor, New Excelsior Building, A. K. Nayak Marg, Fort, Mumbai-400 001 Pan: Aaacb8155C ...... Appellant Vs. Ito-2(1) (1), R. No. 561, 5Th Floor, Aayakar Bhavan, M. K. Road, Mumbai- 400 020 ..... Respondent

For Appellant: Shri Sujay Waikul, Ld. ARFor Respondent: Shri S. Srinivas, Ld. DR

Section 143(2)Section 234BSection 24Section 250Section 271(1)Section 32(1)Section 57

case and in laws, the learned Assessing officer erred in not allowing deduction of Rs. 39, 99,402/- being depreciation allowable under section 32(1) of the Income Tax Act, 1961, and the reasons for doing so are wrong and contrary to the facts and circumstances of the case, provisions ... assessee is dismissed in above terms. 11. Ground no. 3 pertains to not allowing deduction of Rs. 39, 99,402/- being depreciation under section 32(1) of the Income Tax Act, 1961. On this issue, we observed while going through the assessment order, no specific disallowance on this count

DCIT (Ltu) 2, Mumbai vs. Asian Paints Ltd, Mumbai

In the result, the appeal by the Revenue is partly allowed for statistical purposes

ITA 2959/MUM/2019[2015-16]Status: DisposedITAT Mumbai08 Mar 2024AY 2015-16

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Fenil Bhatt a/wFor Respondent: Shri Vachashpati Tripathi

Section 10Section 142(1)Section 143(2)Section 143(3)Section 14ASection 250Section 37(1)

claimed additional depreciation @10% on the fixed assets acquired during the financial year 2013-14 amounting to Rs.2,86,47,976 under section 32(1)(iia) of the Act. Accordingly, the assessee was asked to explain the allowability of additional depreciation so claimed. In response thereto, the assessee submitted that ... section 32(1)(iia) of the Act, the assessee is entitled to claim 20% additional depreciation on any new plant and machinery acquired after 31/03/2005. It was further submitted that as per the provision to section 32(ii)(b), if the assets are put to use for less than

Asian Paints Limited, Mumbai vs. Dy. CIT Ltu, Mumbai

In the result, the appeal by the Revenue is partly allowed for statistical purposes

ITA 1673/MUM/2019[2015-16]Status: DisposedITAT Mumbai08 Mar 2024AY 2015-16

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Fenil Bhatt a/wFor Respondent: Shri Vachashpati Tripathi

Section 10Section 142(1)Section 143(2)Section 143(3)Section 14ASection 250Section 37(1)

DCIT (Ltu) 2, Mumbai vs. Asian Paints Ltd, Mumbai

Appeal is dismissed

ITA 840/MUM/2018[2014-15]Status: DisposedITAT Mumbai06 Mar 2024AY 2014-15

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Madhur AgrawalFor Respondent: Shri Vachashpati Tripathi

Section 10(34)Section 142(1)Section 143(2)Section 143(3)Section 144C(3)Section 14ASection 250

assessee has claimed additional depreciation @10% on assets acquired during the financial year 2012-13 amounting to Rs.70,31,74,747 under section 32(1)(iia) of the Act. Accordingly, the assessee was asked to explain the allowability of additional depreciation so claimed. In response thereto, the assessee submitted that ... section 32(1)(iia) of the Act, the assessee is entitled to claim 20% additional depreciation on any new plant and machinery acquired after 31/03/2005. It was further submitted that as per the provision to section 32(ii)(b), if the assets are put to use for less than

Asian Paints Ltd, Mumbai vs. Asst CIT (Ltu) 2, Mumbai

The appeal is dismissed holding that the learned CIT appeal is correct in allowing

ITA 269/MUM/2018[2014-15]Status: DisposedITAT Mumbai06 Mar 2024AY 2014-15

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Madhur AgrawalFor Respondent: Shri Vachashpati Tripathi

Section 10(34)Section 142(1)Section 143(2)Section 143(3)Section 144C(3)Section 14ASection 250

DCIT (Ltu) 2, Mumbai vs. Asian Paints Ltd, Mumbai

Appeal is allowed

ITA 841/MUM/2018[2013-14]Status: DisposedITAT Mumbai05 Mar 2024AY 2013-14

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhailasian Paints Ltd. Asian Paints House 6A, Shanti Nagar, Santacruz (East) Mumbai 400 055 Pan – Aaaca3622K Appellant Asstt. Commissioner Of Income Tax Large Taxpayer Unit-2, Mumbai V/S

For Appellant: Shri Madhur AgrawalFor Respondent: Shri Vachashpati Tripathi

Section 10(34)Section 142(1)Section 143(2)Section 143(3)Section 144C(3)Section 14ASection 250

IN THE INCOME TAX APPELLATE TRIBUNAL “K” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER AND SHRI SANDEEP SINGH KARHAIL