Court dismisses appeals due to delay in re-filing, rejects condonation applications. Assessee prevails on expense disputes.

The Court dismissed the appeals due to a delay of 592 days in re-filing, attributing it to the transition to e-filing. The applications for condonation of the delay were rejected as the Court found the delay unacceptable. The disputes regarding disallowance of expenses related to ESOP and the treatment of software expenses were resolved in favor of the Assessee based on previous Court rulings and the ITAT's decisions. The Court emphasized the lack of substantial legal questions, leading to the dismissal of the appeals on both delay and merits grounds.

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Issues:
1. Condonation of delay in re-filing the appeals.
2. Disallowance of expenses related to Employees Stock Option Plan (ESOP).
3. Treatment of software expenses as capital or revenue expenditure.

Condonation of Delay:
The judgment addresses the delay of 592 days in re-filing the appeals, attributing it to the transition to e-filing. The Court deems the delay unacceptable, emphasizing that the practice directions for e-filing were adequately communicated and facilitated by the Court. Consequently, the applications for condonation of the delay are dismissed.

Issue 1 - Disallowance of ESOP Expenses:
Regarding ITA No.366/2016, the dispute revolves around the disallowance of expenses related to ESOP by the Assessing Officer. The ITAT overturned the AO's decision based on a precedent. The Court points out that a similar issue was previously settled in favor of the Assessee by the Court, affirming the ITAT's decision. The ITAT's order to send the matter back to the AO aligns with the Court's previous ruling, leading to the dismissal of the appeal on this issue.

Issue 2 - Treatment of Software Expenses:
In ITA No.367/2016, the question is whether software expenses should be treated as capital or revenue expenditure. The ITAT relied on a judgment by the Court in a similar case. The Revenue referred to a Special Leave Petition, which was dismissed by the Supreme Court, reinforcing the ITAT's decision. Consequently, the Court finds no substantial legal question arising from the ITAT's order on this matter, leading to the dismissal of the appeals on both delay and merits grounds.

In conclusion, the judgment dismisses the appeals due to the delay in re-filing and on the merits of the issues related to ESOP expenses and the treatment of software expenses. The Court's decision is based on the alignment of the ITAT's orders with previous Court rulings, emphasizing the lack of substantial legal questions in the matters at hand.

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