Depreciation allowable on payment of non-compete fee

India Meditronic (P) Ltd Vs ACIT (ITAT Mumbai) Conclusion: Non-compete fee was allowable as capital expenditure and depreciation could be claimed on the same. Held: Assessee entered into exclusive distribution agreement with Medtech Devices Limited (MDL) for distribution of assessee’s products in India, which accounted for approximately 40% of the total revenue of the assessee in that year. However, the distribution agreement was terminated on account of MDL constraints in investing the required resources to expand its own business in line with assessee’s expectations. Consequently, a non-...