The Tax Publishers2022 TaxPub(DT) 6999 (Mum-Trib)

INCOME TAX ACT 1961

Section 35DD

Where assessee had got relief in assessment year 2007-08 pursuant to the orders passed by AO for assessment year 2007-08 while giving effect to the Tribunal order and the claim was only remaining 1/5th of the total legal fees claimed by the assessee, which was incurred in assessment year 2004-05 being the first year and the present assessment year i.e. assessment year 2008-09 would be the 5th year of claim AO was directed to grant deduction of the remaining 1/5th portion being the legal fees incurred on merger expenses under section 35DD accordingly, in tune with orders passed for the earlier years.

Business deduction under section 35DD - Amortization of expenses - Legal fees incurred on merger expenses -

Assessee filed appeal against disallowance on proportionate deduction under section 35DD in respect of legal fees incurred on amalgamation. Held: Assessee had got relief in assessment year 2007-08 pursuant to the orders passed by AO for assessment year 2007-08 while giving effect to the Tribunal order. This claim was only remaining 1/5th of the total legal fees claimed by the assessee, which was incurred in assessment year 2004-05 being the first year. The present assessment year i.e. assessment year 2008-09 would be the 5th year of claim and accordingly, AO was directed to grant deduction of the remaining 1/5th portion being the legal fees incurred on merger expenses under section 35DD in tune with orders passed for the earlier years. Accordingly, the ground raised by the assessee was allowed.

REFERRED :

FAVOUR : In assessee's favour

A.Y. :


INCOME TAX ACT 1961

Section 40(a)(ia)

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