Goodwill Depreciation Allowed on Slump Sale Business Acquisition: ITAT Chennai

ACIT Vs Dorma India Pvt. Ltd. (ITAT Chennai) The Revenue filed appeals for AYs 2010-11 to 2012-13 challenging the CIT(A)’s order allowing depreciation on goodwill arising from the assessee’s acquisition of the distribution businesses of GTS Exports Private Limited and Arc Trend Systems Private Limited through slump sale agreements. The Assessing Officer disallowed the claim, holding that the excess consideration represented either non-compete fee or merely book entries since tangible assets had been recorded at book value without determining their fair market value. The AO also hel...