Expenditure on Short-Lived CAD Software Eligible for 80IC Deduction

MVM Industries Vs DCIT/ACIT (ITAT Chandigarh) CAD Software is Revenue Expenditure; Full 80IC Benefit Allowed Assessee, eligible for deduction u/s 80IC @25%, purchased Premium CAD software worth ₹25,94,500. AO held it to be capital expenditure, allowed only 12.5% depreciation (treating it as used for <180 days), and reduced the 80IC deduction. CIT(A) upheld the view. Before Tribunal, assessee argued that design/software tools have short useful life, require regular upgrades, and provide no enduring advantage, thus are revenue in nature. ITAT accepted this contention and held that software ...