TaxTMI 
TaxTMI 
2025 (7) TMI 1155
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....,439/- and demanded tax thereon. 2.1. Ld. PCIT perused the above assessment records and found that the assessee claimed expenses of Rs. 13,23,53,583/- in respect of commission and brokerage, however made TDS of Rs. 39,10,033/- only against the commissioner & brokerage of Rs. 7,82,00,098/-. Thus the Assessing Officer failed to verify non deduction as against the commission & brokerage payment of Rs. 5,41,53,485/- for the year under consideration. 3. Similarly, Ld. PCIT noticed from the column 18 of Tax Audit Report for the year under consideration that the assessee has shown opening WDV of intangible assets of Rs. 18,60,92,470/- and claimed depreciation of Rs. 4,65,23,118/- for AY 2018-19. It is to be noted that company incorporated by amalgamation of companies on 05.01.2016. During FY 2016-17 the intangible assets has been introduced in books of account being the brand value, however, mode of acquisition of the brand values has not been disclosed. Thus the aforementioned intangible asset so introduced was none other than transfer of assets only and it is clear that the cost of acquisition of asset is NIL. Since, the cost of asset is NIL, no depreciation is allowable on the same. ....
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....sallowed. 6. In law and in the facts and circumstances of the Appellant's case, the Hon'ble PCIT has failed to appreciate that the twin conditions for assuming jurisdiction u/s. 263 of the Act are not satisfied in the case of appellant company as issue which has been relied upon for passing the order u/s. 263 does not show any error or prejudice to the interest of the revenue. 7. The appellant company craves leave to add, alter or amend and and/or withdraw any ground or grounds of appeal either before or during the course of hearing of the appeal. 5. Ld. Counsel Shri Vartik Choksi appearing for the assessee submitted that the accounting policy of the assessee since its inception is to estimate the expenses of current assessment year and claim the very same in same assessment year. But as on the last date of assessment year, the payees could not be identified, therefore, TDS is not deducted for such claim of provision for expenses. The provision made in the preceding assessment year is reversed on the very first day of succeeding assessment year and reduced from expenses claimed in that succeeding Assessment Year. Therefore the amount of provision of expense which has b....
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....ch is filed at PB Page no. 24 (Relevant). The above merits of the details submitted by the Assessee before PCIT has not been properly considered and it has been rejected for the vague reason that on what objective the basis of valuation has been adopted. Thus Ld. Counsel pleaded that the assessment order is neither prejudicial nor erroneous order and therefore the Revision order passed by Ld. PCIT is liable to be quashed. 6. Per contra, Ld. CIT-DR Mr. V. Nandakumar appearing for the Revenue supported the revision order passed by Ld. PCIT and requested to uphold the same. 7. We have given our thoughtful consideration and perused the materials available on record including the Paper Book and Case Laws Compilation filed by the assessee. In additional Paper Book Page Nos. 1 to 6, the assessee has given the details of commissioner and brokerage expenses claimed as on 31-03-2018 and reversing the same as on 01-04-2018 and subsequent years as follows: F.Y. 2017-18 as on 31-03-2018 Rs. 10,89,22,467/- F.Y. 2018-19 as on 01-04-2018 Rs. (-) 10,86,95,610/- F.Y. 2018-19 as on 31-03-2018 Rs. 9,63,90,189/- F.Y. 2019-20 as on 01-04-2019 Rs. (-) 9,63,90,189/- F.Y. 2019-20 as on 31-03-20....
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.... the government exchequer and a certificate has to be issued to the concerned person who is recipient of such sum/income payable by the assessee. But the same is not possible where the recipient of such sum/income payable by the assessee is not identifiable. In other words, the assessee cannot comply the provisions of chapter XVII of the Act with respect to the expenses claimed on provisional basis in a situation where the recipients/parties/payees are not identifiable. In the case on hand, there was no allegation from the revenue that recipients/parties/payees are identifiable. Thus we can safely conclude that recipients/parties/payees are not identifiable in the present case in the given facts and circumstances and accordingly the assessee cannot be treated as assessee is default on account of non-deduction of TDS under the provisions of section 40(a)(ia) of the Act. In holding so, we draw support and guidance from the order of Hon'ble Chennai tribunal in case of Dishnet Wireless Limited vs. DCIT in ITA No. 320 to 329/Mds/2014 reported in 60 taxmann.com 329 where tribunal held as under: 23. We have considered the rival submissions on either side and perused the relevant mat....
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....the provision which requires deduction of tax at source fails. Hence, the assessee cannot be faulted for non-deduction of tax at source while making a provision. Therefore, we are unable to accept the contention of the Id. D.R. Accordingly, the orders of the lower authorities are set aside and this ground of appeal is allowed. 20.5 We also find support from the order of the Hon'ble Jurisdictional high court in case PCIT vs. Sanghi Infrastructure Ltd. reported in 96 taxmann.com 370 where the Hon'ble court held as under: 4. Now, so far as the proposed question No. B viz. deleting dis-allowance made on account of lease rental payments, dis-allowance of Rs. 70 lakh under Section 37(1) of the IT Act on account of operating and maintenance charges and repairs and maintenance charges of Rs. 60 lakh under Section 40(a)(ia) of the IT Act on the payments on which TDS was not deducted by the assessee is concerned, it is required to be noted that in the year under consideration, no TDS was deducted as the same was contingent liability and the bills were not issued which were issued subsequently and on that the TDS was deducted as and when the final bills were received. Considering ....
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....91,909) Provisions (32,755,343) Total - Net Asset 2,532,508,028 Note 43 : Changes in Non controlling interest During the year ended March 31, 2017, pursuant to Share subscription and shareholders agreement, the Company. has issued 1,12,08,200 equity shares of Rs. 2/- each at a premium of Rs. 658.20, outside the group, whereby the controlling interest of the group in Company has reduced to 89.69% from 100%. Note 44 : Regrouped, Recast, Reclassified Figures of the earlier year have been regrouped or reclassified to conform to Ind AS presentation requirements. 8.1. Similarly in the books of ALBL the very same amount of Rs. 21,26,77,109/- (Gross Value Rs. 52,33,94,600/- Less Accumulated Depreciation- Rs. 31,07,17,491/-) which is shown at Note No. 6 as intangible assets which was produced before Ld. PCIT by the assessee. However the same was not considered by Ld. PCIT. 8.2. The Co-ordinate Bench of this Tribunal in the case of Bodal Chemicals Ltd. Vs. ACIT reported in [2019] 112 taxmann.com 217 held that pursuant to scheme of amalgamation, assessee claimed depreciation on goodwill representing higher amount paid to transferor company as compared to its net assets, in view ....
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....not in the present facts be faulted with, as it is in accord with the Apex Court decision in Bharat Sanchar Nigam Ltd. v. Union of India (2006) 282 ITR 273. [Para 9]" In view of the above, the assessee succeeds on the principle of consistency. Accordingly we set aside the order of the learned CIT (A) and direct the AO to allow the depreciation to the assessee. Hence the ground of appeal of the assessee is allowed." 8.3. This view of the Tribunal is been followed by the Mumbai Bench of this Tribunal in the case of Man Industries (India) Ltd. Vs. ACIT in ITA No. 1490/Mum/2021 dated 28-10-2022 held as follows: "10. Under these facts, it is contention of the assessee that the AO could not have disallowed in the subsequent years, since the depreciation has been allowed in the first year. We notice that the above said proposition of the assessee finds support from the decision rendered by Ahmedabad bench of ITAT in the case of Bodal Chemicals Ltd (supra), wherein it was held that the revenue, once allowed the deduction for the depreciation claimed by the assessee, then it is debarred to reject the claim of the assessee in the subsequent year on the WDV carried forward from the earli....