section 32

Would the phrase “used for purpose of business” in respect of discarded machine include use of such asset in the earlier years for claim of depreciation under section 32?

CIT v. Yamaha Motor India Pvt. Ltd. (2010) 328 ITR 297 (Delhi) - The issue under consideration in this case is whether depreciation is allowable on the written down value of the entire block, even though the block includes some machinery which has already been discarded and hence, cannot be put to use during the relevant previous year.
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Is the assessee entitled to depreciation on value of goodwill considering it as “other business or commercial rights of similar nature” within the meaning of an intangible asset?

B. Raveendran Pillai v. CIT (2011) 332 ITR 531 (Kerala)- Under section 32(1)(ii), depreciation is allowable on intangible assets, being know-how, patents, copyrights, trade marks, license, franchise, or any other business or commercial rights of similar nature.
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Can EPABX and mobile phones be treated as computers to be entitled to higher depreciation at 60%?

Federal Bank Ltd. v. ACIT (2011) 332 ITR 319 (Kerala High Court) - On this issue, the High Court held that the rate of depreciation of 60% is available to computers and there is no ground to treat the communication equipment as computers. Hence, EPABX and mobile phones are not computers and therefore, are not entitled to higher depreciation at 60%.
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Whether for the purpose of determining the applicability of section 47, the condition for wholly-owned subsidiary is to be seen on the last date of financial year and explanation 6 to section 43(1) is not applicable?

DCIT, New Delhi Vs M/s NTPC-SAIL Power Supply Co Ltd - Whether after insertion of proviso to section 36(1)(iii), the interest paid on capital borrowed for acquisition of an asset for extension of existing business or profession for any period beginning from the date on which the capital was borrowed for acquisition of the asset till the date on which such asset was first put to use, is rightly not allowed as deduction and the interest income earned on FDRs made from surp..
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Assessee is entitled to depreciation on Wind Electric Generators from the date on which it was installed and commissioned

Hindustan Platinum Pvt Ltd Vs ACIT (ITAT Mumbai) - Statement given u/s 131 cannot be the only basis for disallowing the claim of depreciation when it is shown with documentary evidence that the admission made in the statement recorded was under a mistake or misapprehension. Assessee is not entitled to claim loss u/s 28 on account bad debt of the advance given as inter corporate deposit without establishing the fact that it was a trade advance
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Goodwill is an intangible asset u/s 32(1)(ii) of Income Tax Act, 1961 and eligible for depreciation

On merits, s. 32(1)(ii) allows depreciation in respect of know-how, patent, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature. The term “commercial rights” are such rights which are obtained for effectively carrying on business and commerce. “Commerce” is a wide term which encompasses many a facet. Accordingly, any right obtained for carrying on business with effectiveness comes within the sweep of meaning o..
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Invocation of powers u/s 263 is legitimate on the ground of lack of compliance with the principle of consistency in allowing certain expenses as revenue expenditure

M/s Frick India Ltd Vs DCIT (ITAT Delhi) - There was a composite agreement titled as 'intellectual property license and non compete agreement' vide which several valuable rights including the right to use the trademark, technical know-how including right to export to 30 countries have been granted over a long period of ten years to the assessee, which gave rise to a benefit of enduring nature. However, the AO has allowed the same as revenue expenditure without applicatio..
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Unabsorbed depreciation of AYs 1997-98 to 2001-02 not eligible for relief granted by amended s. 32(2) in AY 2002-03- Special Bench Reverses S. 32 Depreciation Law

Till AY 1996-97 unabsorbed depreciation could be set off against income under any head. From AY 1997-98 to 2001-2002 unabsorbed depreciation could be set off only against business income. From AY 2002-2003 onwards unabsorbed depreciation could again be set off against income under any head of income.
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