Case Law Details
Maya Entertainment Ltd Vs DCIT (ITAT Pune)
We note that the assessee is a company engaged in the business of aviation training and hospitality industry. It imparts training programs ranging from personality development and grooming to high-end professional courses like training for cabin crew, ground staff and cargo handlers for the aviation sector. The assessee entered into an agreement with Avalon Aviation Academy and acquired various assets and liabilities for a lump sum consideration of Rs.75,00,000/- in F.Y. 2005-06. The excess of the consideration over the fair value of these assets on the date of acquisition of Rs.60,85,577/- which was treated by the assessee as goodwill. The assessee claimed the same as depreciation/amortization on the ground that it is a right in the nature of know-how, patents, copyrights, trademarks, licenses, franchises or any other business or commercial rights of similar nature being intangible assets. The AO denied depreciation by holding that the goodwill is not included any specific items and rejected the claim of the assessee and added Rs.10,73,646/- to the income of the assessee. The CIT(A) discussed the issue in Para No. 8 and following its own order for A.Y. 2011-12 confirmed the order of AO. We find a similar issue in assessee’s own case for A.Y. 2011-12 came up before this Tribunal and the Tribunal by following the earlier order in assessee’s own case allowed depreciation.
Following the order of this Tribunal in assessee’s own case for A.Y. 2011-12, thus, we hold that the assessee is entitled to claim depreciation on goodwill.
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal by the assessee against the order dated 31-03-2016 passed by the Commissioner of Income Tax (Appeals)-1, Pune [‘CIT(A)’] for assessment year 2010-11.
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