Case: R.G. Keswani Vs The Asstt. Commissioner of Income-tax. ITAT (Income Tax Appellate Tribunal)
| Judges | O.K. Narayanan, Accountant Member and Asha Vijayaraghavan, Judicial Member |
| Issue | Income Tax Act, 1961 - Sections 32(1)(ii), 55(2), 143(3) |
| Citation | [2009] 116 ITD 133 (Mum) , (2009) 120 TTJ (Mum) 1081 |
| Judgement Date | February 19, 2008 |
| Court | ITAT (Income Tax Appellate Tribunal) |
Order:
O.K. Narayanan, Accountant Member (At Mumbai 'H' Bench)
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This appeal is filed by the Assessee. The relevant assessment year is 2002-2003. The appeal is directed against the order of the CIT(A)-XIX at Mumbai, dated 31.12.2004 and arises out of the assessment completed Under Section 143(3) of the Income-tax Act, 1961.
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The only ground raised in this appeal is that the lower authorities have erroneously declined to accept the claim of depreciation of Rs. 4.68,705, made by the assessee on goodwill of Rs. 25,00,000, which was purchased by the assessee in the previous year relevant to the assessment year under appeal.
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The assessee had commenced its business on 1.6.2000 by acquiring goodwill and the name of an existing firm "M/s. R.G. Keswani & Engrep". The said firm was running its business since 1988 as indenting agent. According to the assessee, the said firm had developed reliable business relationship with foreign principals and had earned a goodwill and trade name in the line of business. Therefore, while acquiring the said goodwill and name of the said name M/s. R.G. Keswani & Engrep., the assessee had paid an amount of Rs. 25,00,000 in the trade name goodwill and for all other business and commercial rights. According to the assessee, what was acquired by the assessee by paying Rs. 25,00,000 was an intangible asset, and therefore, entitled for depreciation under the provisions of Section 32(1)(ii). The assessee had explained that as the goodwill was utilized by the assessee for carrying on the business, its business increased many fold and the goodwill and the name of the old firm have been extensively used for the performance of the assessee-company. In the assessment order, this contention was not accepted by the Assessing Authority for the reason that the goodwill cannot be treated as intangible asset, and therefore, not depreciable. The Assessing Officer also observed that goodwill would not fall under "any other business or commercial rights of similar nature". In first appeal, the CIT(A) held that the only issue to be considered is whether the goodwill acquired by the assessee would be covered by the expression "any other business or commercial rights of similar nature", being intangible asset in nature. He held that the consideration was in the nature of a capital payment. In the table of rates prescribed for depreciation, the goodwill is not separately dealt with. The Intangible assets explained in law including know-how, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature are clubbed together on which depreciation is admissible at the rate of 25%. He further observed that Section 55(2) of the Income-tax Act deals with cost of acquisition, in relation to capital assets, being goodwill of business or trademark or brand name associated with the business or right to manufacture, process, any article or things, tenancy rights etc. In case of acquisition of such assets by the assessee by purchase from previous owner, the cost of acquisition means the amount of purchase price. Thus, if the present case is the one, the future of the...
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I.T.A. No. 3928/Mum/2008, (Assessment Year: 2003-2004). Case: Video Effects Vs Income Tax Officer-11(1)(4). ITAT (Income Tax Appellate Tribunal)
... ... an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)-XI, Mumbai ('CIT(A)' for short) dated 28.04.2008, ... Keswani vs. Asst. CIT [2009] 116 ITD 133 (Mum). 'Goodwill', it was the constant ... ...
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ITA No. 38/Panaji/2009 (Asst. Yr. 2005-06). Case: Chowgule and Co. (P) Ltd. Vs Assistant Commissioner of Income Tax. ITAT (Income Tax Appellate Tribunal)
...of her assertions. She also relied on the judgment by the Mumbai Bench of the Tribunal in the case of R.G. Keswani v. Asstt. CIT (2009) 120 TTJ (Mum) 1081 (2009) 18 DTR (Mumbai)(Trib) 426: (2009) 308 ITR 271 (Mum)(AT) which is on identical facts and as such the claim of the Assessee being c......
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I.T.A. No. 3928/Mum/2008, (Assessment Year: 2003-2004). Case: Video Effects Vs Income Tax Officer-11(1)(4). ITAT (Income Tax Appellate Tribunal)
... ... an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)-XI, Mumbai ('CIT(A)' for short) dated 28.04.2008, ... Keswani vs. Asst. CIT [2009] 116 ITD 133 (Mum). 'Goodwill', it was the constant ... ...
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I.T.A. No. 3928/Mum/2008, (Assessment Year: 2003-2004). Case: Video Effects Vs Income Tax Officer-11(1)(4). ITAT (Income Tax Appellate Tribunal)
... ... an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)-XI, Mumbai ('CIT(A)' for short) dated 28.04.2008, ... Keswani vs. Asst. CIT [2009] 116 ITD 133 (Mum). 'Goodwill', it was the constant ... ...
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ITA No. 38/Panaji/2009 (Asst. Yr. 2005-06). Case: Chowgule and Co. (P) Ltd. Vs Assistant Commissioner of Income Tax. ITAT (Income Tax Appellate Tribunal)
...of her assertions. She also relied on the judgment by the Mumbai Bench of the Tribunal in the case of R.G. Keswani v. Asstt. CIT (2009) 120 TTJ (Mum) 1081 (2009) 18 DTR (Mumbai)(Trib) 426: (2009) 308 ITR 271 (Mum)(AT) which is on identical facts and as such the claim of the Assessee being c......
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I.T.A. No. 3928/Mum/2008, (Assessment Year: 2003-2004). Case: Video Effects Vs Income Tax Officer-11(1)(4). ITAT (Income Tax Appellate Tribunal)
... ... an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)-XI, Mumbai ('CIT(A)' for short) dated 28.04.2008, ... Keswani vs. Asst. CIT [2009] 116 ITD 133 (Mum). 'Goodwill', it was the constant ... ...