Principal Commissioner Of Income Tax vs Landis Gyr Limited

The Court : The short question which the Revenue raises is regarding the permissibility of a claim for deduction made for the first time before the

Appellate Tribunal without such claim having been made earlier.

It appears that a fresh ground was urged before the Appellate Tribunal by the assessee that it was entitled to depreciation of the goodwill that had

been acquired pursuant to the acquisition of a company or a unit or the like.

Such claim on account of depreciation of goodwill was made on the strength of a Supreme Court Judgment reported at 348 ITR 302 where the

Supreme Court found that goodwill was an intangible asset within the meaning of Section 32(1) of the Income Tax Act, 1961 and capable of being

subjected to depreciation.

The assessee refers to a previous judgment of the Supreme Court reported at 229 ITR 383 for the proposition that if, as a result of any judicial

decision given while the appeal is pending, it is found that a non-taxable item is taxed or a permissible deduction is denied, it would be open for such

ground to be raised in course of the appeal and the matter to be adjudicated upon.

The Supreme Court found that in view of the wide authority conferred by Section 254 of the Act to the Appellate Tribunal, a point in such regard

could be taken for the first time before the Appellate Tribunal if such point arose as a result of a judicial decision that affected the rights of the

assessee during the pendency of the appeal.

In view of the aforesaid, there does not appear to be any substantial question of law warranting reconsideration of the Appellate Tribunal’s

opinion. ITAT No.439 of 2016 and GA No.70 of 2017 are disposed of. There will be no order as to costs.