TaxTMI 
TaxTMI 
2020 (4) TMI 823
X X X X Extracts X X X X
X X X X Extracts X X X X
....as raised following grounds in this appeal:- "The Appellant prefers following grounds in appeal against the order dated March 30, 2015 passed by the Commissioner of Income-tax (Appeals)-IV, New Delhi [hereinafter referred to as "CIT(A)"] under Section 250 of the Income Tax Act, 1961 [hereinafter referred to as "Act"]. 1.0 That the order passed by CIT(A) partly allowing the appeal filed by the Appellant without appreciating facts on record is bad in law and is liable to be quashed; 2.0 Disallowance of non-compete fees 2.1 That the Ld. CIT(A) erred in law in holding that the amount of Rs. 50,64,83,985 claimed on account of 'non-compete' fees was capital expenditure in nature not eligible as a revenue expend....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... that similar claim was allowed by Ld. CIT(A) as revenue in nature in appellant's own case for AY 2004-05 and AY 2005-06." 3. The first ground of appeal raised by the assessee is general in nature and does not require any adjudication. 4. The Ground of appeal Nos. 2 to 2.6 raised by the assessee is against the treatment of non-compete fee of Rs. 50,64,83,985/- as capital expenditure. In the alternate vide Ground No.2.5, the assessee has raised that incase expenditure is held to be capital in nature then depreciation is to be allowed on the same. 5. Briefly in the facts of the case the assessee had claimed deduction of Rs. 50,64,83,985/- as non-compete fee amortized. The assessee explained that during the year under consideration, i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eld to the extent that the payment of noncompete fee was a capital expenditure and the assessee was not entitled to claim depreciation u/s 32 of the Act on the said capital expenditure. He further pointed out that the Hon'ble Delhi High Court in assessee's own case has admitted both issues as question of law and the same are pending for adjudication. 7. We have heard the rival contentions and perused the record. In view of the issue decided against the assessee by the Tribunal (supra), we uphold the order of the CIT(A) and hold that the payment of non-compete fee was capital expenditure in the hands of the assessee, on which the assessee is not entitled to claim depreciation u/s 32 of the Act. The Tribunal had relied on the decision of J....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s Honda Siel Power Products Ltd. [2007] 300 ITR 56 (Del.). He further stated that though the expenditure on ice boxes was disallowed in Assessment Year 2002-03 but no disallowance was made by the Assessing Officer on expenditure totaling Rs. 8.91 crores (approx.) in Assessment Year 2003-04. Further, in Assessment Year 2004-05 though the Assessing Officer disallowed the expenditure of Rs. 4.87 crores (approx.) but the CIT(A) had deleted the same and no appeal has been filed by the Revenue against the order of CIT(A). He further stressed in Assessment Year 2005-06, similar recurring expenditure for carrying on business was incurred and claimed as revenue expenditure amounting to Rs. 5.10 crores (approx.), which was allowed. 10. The Ld. ....