2014 (1) TMI 1305

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....er hearing both the parties and considering the facts of the case, we find this issue to be covered in favour of the assessee by the decision of ITAT in earlier years. In AY 2003-04, the sum of Rs. 90,37,605/- claimed by the assessee as product improvement expenses was treated as capital expenditure by the Revenue. Learned CIT(A) allowed the relief, against which, Revenue was in appeal. However, the ITAT, vide order dated 28th August, 2012 rendered in ITA No.1619 to 1621/Del/2010, upheld the order of the CIT(A) and dismissed the Revenue's appeal. Similar view is followed in AY 2004- 05, 2005-06 & 2006-07 and thereafter, in AY 2007-08. In view of the above orders of the ITAT in preceding five years, we do not find any justification to interf....

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....case of the year in which the expenditure is claimed. An assessee cannot be permitted to claim the expenditure in one year and reverse the entry in the next year. He submitted that if the addition is revenue neutral, why the assessee contested the matter in appeal before the learned CIT(A). He, therefore, submitted that the addition should be sustained in this year. 7. In the rejoinder, it is stated by the learned counsel that if the addition is sustained in this year, then it would amount to double addition because in the subsequent year, by reversing the entry, the assessee has offered the sum of 88,87,668/- as its income. He, therefore, submitted that he has no objection if the addition is sustained in this year with a direction to th....

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.... treated as income of the assessee, otherwise, it would amount to double taxation. We, therefore, direct the Assessing Officer to verify the assessee's contention that in the subsequent year, the income of Rs. 88,87,668/- has been offered by way of reversal of the entry of expenditure. If it is so, he will give the consequential effect i.e., such reversal would not be treated as income of the assessee in that year. With this direction, ground No.2 of the Revenue's appeal is allowed. 10. Ground No.3 of the Revenue's appeal reads as under:- "The ld.CIT(A) erred on facts and in law in deleting the addition amounting to Rs. 10,79,660/- capitalization of licence fee paid to M/s Nuance Communication." 11. We have heard both the parties a....