IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B” NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI MANISH AGARWAL, ACCOUNTANT MEMBER आ.अ.स/ं .I.T.A No.1053/Del/2020 िनधा(cid:9)रणवष(cid:9)/Assessment Year:2014-15 CyberQ Consulting Private Limited बनाम ACIT J-1917, CR Park, New Delhi. Vs. Circle-6(2), PAN No.AAACC6692B C.R. Building, ITO, I.P. Estate, New Delhi.

अपीलाथ(cid:20) Appellant (cid:22)(cid:23)यथ(cid:20)/Respondent Assessee by Shri Tanpreet Kohli, CA Revenue by Shri Rajesh Kumar Dhanesta, Sr. DR सनु वाईक(cid:8)तारीख/ Date of hearing: 27.02.2025 उ(cid:14)ोषणाक(cid:8)तारीख/Pronouncement on 27.02.2025 आदेश /O R D E R PER MANISH AGARWAL, AM This is the appeal filed by the Assessee against the order of Commissioner of Income Tax (Appeals)-33, New Delhi passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred as ‘the Act’)

in appeal no.499/2017-18 dated 27.02.2019 for AY 2014-15.

2. Brief facts of the case are that the Assessee is a Private Limited Company engaged in the business of providing software management consultancy and manpower outsourcing. The return of income for the impugned order was filed on 28.11.2014 declaring loss of Rs.46,83,800/- under Income tax proceedings and book profit of Rs.12,20,223/- u/s 115JB of the Act. The case of the assessee was selected for scrutiny and vide orders passed u/s 143(3) of the Act dated 15.12.2016 the total income of the assessee was assessed at Rs.22,14,227/- by making disallowance u/s 40(a)(ia) of the Act of Rs.3,23,910/- and further disallowance of Rs.65,73,917/- out of Courseware Development Charges claimed by the assessee. In first appeal vide impugned order dated 27.02.2019 the Ld. CIT(Appeal)

dismissed the appeal of the assessee.

3. Aggrieved by the said order, the assessee is in appeal before the Tribunal by taking following grounds of appeal: -

1. “That on the facts and the circumstances of the case and in law, the Ld. Commissioner of Income Tax (Appeals) has erred in upholding the order passed the Assessing Officer.

2. That on the facts and the circumstances of the case and in law, the Ld. AO and Ld. CIT(A) have failed to appreciate the nature of the expenses incurred by the assessee on the courseware development project (in short ‘project’) and ignored the fact that the expenses are revenue in nature which will benefit the assessee in revenue field rather than capital.

3. That the Ld. AO and Ld. CIT(A) have grossly erred on facts and in law in concluding that a new identified assets has come into existence on account of incurrence of such expenditure by the Appellant and thus such expense is to be treated as capital expenditure.

4. That on the facts and the circumstances of the case and in law, the Ld. CIT(A) has failed to appreciate the fact that the expenses incurred by the assessee on the project are integral part of the profit earning process and not for acquisition of an assets, right of permanent character.

5. That on the facts and the circumstances of the case and in law, both the Ld. AO and Ld. CIT(A) have failed to appreciate the fact that accounting treatment of an expenditure in books of accounts does not determine the allowability of expenditure in computation of total income as provision of Income-tax Act, 1961.”

4. Since all the grounds of appeal are in relation to the disallowance of Rs.65,73,917/- made out of Courseware Development Expenses therefore they are taken together for consideration.

5. Before us the Ld. AR of the assessee submitted that assessee has entered into a MOU with Rama Krishna Mission according to which training was to be imparted to its students so as to enable them to get better employment opportunities. The assessee in order to develop the coaching facilities for such training purpose, had started expansion in its centre by setting up fresh training facilities. For this purpose various expenses were incurred towards advertisement and publicity, consultancy, electricity and water etc. and the cumulative expenses