Document Fragment View

Matching Fragments

i) Cost of production of TV serials and programmes relating to the year under consideration claimed as revenue expenditure - Rs. 143,49,17,000/-
ii) Excess depreciation claimed on 'film software library - Rs.

125,72,32,479/-.

3. When the assessee preferred an appeal before the CIT(A), the CIT(A) confirmed the disallowance on account of excess depreciation of Rs. 143,49,17,000/- and deleted the disallowance of Rs. 125,72,32,479/- on account depreciation on enhanced value of software library.

4. Aggrieved by the order of CIT(A), both the assessee and revenue are in appeal before us.

5. As regards the addition of Rs. 143,49,17,000/ -, the AO observed that the assessee debited an amount of Rs. 148,07,48,000/ - towards cost of production of TV serials and programmes during the year under consideration. He noted that instead of claiming depreciation, the entire expenditure was claimed as revenue expenditure and debited to P&L account. The AO observed that the Ushodaya Enterprises Ltd., Hyd.

definition of Rule 9A clearly shows that the expenditure of the assessee company on production of TV serials and programmes was not covered, and as per the definition of Rule 9B the expenditure claimed by the assessee is not covered as the assessee is not a film distributor. He, therefore, disallowed the above amount.

6. CIT(A) following his decision in AY 2010 -11, confirmed the addition made by the AO.

7. Before us, the ld. AR of the assessee submitted that the issue is squarely covered by the decision of coordinate bench of this Tribunal in the case of Prism TV Pvt. Ltd., in ITA No. 466 & 129/Hyd/2015 vide order dated 24/03/2016.

8. Ld. DR, on the other hand, relied on the orders of revenue authorities.

9. Considered the rival submissions and perused the material on record. In the case of Prism TV Pvt. Ltd. (supra), the coordinate bench, has held as under:

6. As regards ground No.2, against the treating of the cost of production of TV serials and programmes as capital expenditure, brief facts are that the assessee company deb ited an amount of Rs.123,63,94,000 towards cost of production of TV serials and programmes for the year under consideration.