Case Law Details
The Assessing Officer found that the assessee company acquires land from government for exploration of coal out of the designated allotment of land. The assessee claimed before the Assessing Officer that the amount paid for the lease land are the commercial assets of the company. The price paid is actually for purchase of a mining right which is a capital expenditure. The Assessing Officer also noted that in the preceding year, such a claim has been disallowed by the CIT(A)and the Tribunal. Therefore, the Assessing officer did not accept the claim of the assessee and disallowed Rs. 1769.58 lakhs.
On appeal, the CIT(A) following the decision dated 12.9.2011 of the Tribunal in assessee’s own case in ITA No. 226,227/CTK/2009, 456,457 & 458/CTK/2010 and No. 50,51,52 & 53/CTK/2011, has confirmed the addition. Consequently, the depreciation claimed by the assessee was also disallowed by the CIT(A).
Held by ITAT
Both the parties agreed before us that the above issues are covered by the decision of this Tribunal in assessee’s own case for the assessment year 2008-09 in ITA No. 73/CTK/2012 order dated 3.1.2018. The findings portions are as under:
“45. Ld D.R. objected to the admission of additional grounds on the ground that the grounds have to be dismissed as the lease hold rights are not eligible for depreciation u/s.32(1)(ii) of the Act considering it as intangible asset. He referred to the decision of Hon’ble High Court of Bombay in the case of CIT vs. Techno Shares Stocks Ltd., 225 CTR 337 (Bom), wherein, it has been held that the depreciation under section 32 is restricted to the tangible/intangible assets which are specifically enumerated therein and depreciation is not allowable on all tangible/intangible assets. He also referred to the decision of ITAT Mumbai Benches in the case of Dabur India ltd. vs ACIT, 159 TTJ 563 (Mumbai), wherein also, it was held that the tenancy rights cannot be construed as intangible assets falling within meaning Explanation to section 32(1) and, therefore, there is no question of allowing depreciation on said rights.
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