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of <h1>Tribunal overturns jurisdiction assumption under Income Tax Act, allowing appeal based on lack of validity.</h1> <h3>Piaggio Vehicle (P) Ltd. Versus Deputy Commissioner of Income Tax</h3> The Tribunal allowed the appeal, ruling that the Commissioner's assumption of jurisdiction under section 263 of the Income Tax Act lacked validity. The ... - Issues involved: Appeal against order u/s 263 of IT Act for assessment year 2001-02 challenging depreciation on goodwill and leasehold rights.Depreciation on Leasehold Rights: Assessee claimed depreciation on leasehold rights based on detailed submissions regarding the nature of the asset and provisions of the Income Tax Act. Assessing Officer disallowed depreciation on leasehold rights in the assessment order, citing reasons. However, no comments were made on the depreciation claimed on goodwill. The Commissioner issued a show cause notice to revise the assessment order, contending that granting depreciation on goodwill was erroneous and prejudicial to revenue. Assessee objected, arguing lack of evidence of Assessing Officer's consideration on goodwill depreciation. Tribunal held that the Assessing Officer had detailed explanations on the claim and allowed it in previous years, indicating application of mind. It was concluded that the Commissioner's assumption of jurisdiction u/s 263 lacked validity, as the Assessing Officer had considered the claim of depreciation on goodwill.Depreciation on Goodwill: Goodwill depreciation was acquired for a specific consideration, including various commercial rights. The Assessing Officer did not comment on the depreciation claimed on goodwill in the assessment order. The Commissioner sought to disallow depreciation on goodwill, stating lack of evidence of Assessing Officer's consideration on the issue. Tribunal found that the Assessing Officer had detailed explanations on the claim and allowed it in previous years, indicating application of mind. The Tribunal vacated the Commissioner's order, ruling that there was no basis to conclude that the Assessing Officer did not apply his mind to the claim of depreciation on goodwill. The appeal was allowed based on the lack of validity of jurisdiction, without making any observation on the merits of the claim.
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