section 32

No more Depreciation allowed on Goodwill

Income Tax - As the budget 2021 unveiled, it came up with the proposals to boost the economy and certain important proposed amendments. One of the proposed amendments was  'No more Depreciation on Goodwill'....

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Depreciation on Goodwill

Income Tax - Section 2 of the Act provides the definitions for the purposes of the Act. Clause (11) of the said section defines―block of assets‖ to mean a group of assets falling within a class of assets comprising, tangible assets, being buildings, machinery, plant or furniture and intangible assets, being know-how, patents, copyrights, trade-mar...

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No Depreciation on Goodwill- Finance Bill 2021

Income Tax - A brief analysis of the provisions and how it may impact: Depreciation on Goodwill has been one long debatable issue. Even after Supreme Court Judgment in the case of Smiff Securities Limited wherein the Supreme Court of India held that goodwill of a business is a depreciable asset, taxman have been issuing notices to companies […]...

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Disallowance of Depreciation | Section 43(1) | Cash Payment for Fixed Assets

Income Tax - Disallowance of Depreciation section 43(1)) Disallowance of Depreciation where cash payment exceeding Rs. 10,000 is made for purchase of asset (Amendment to section 43(1)) Clause (1) of section 43 defines ‘actual cost’ for the purposes of claiming depreciation. The cost in acquisition of any asset or part thereof in respect of...

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Analysis of claim of Additional Depreciation

Income Tax - Like most other laws tax law is also an ever evolving subject. Tax laws, every now and then result into difference of opinion between the revenue authorities and tax payers on various issues. Indian Income-tax law has many such issues one of which is benefit of Additional Depreciation....

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Additional 15% depreciation on Motor Vehicles- No TDS on cash payments by APMCs

Income Tax - Addressing the concerns raised by Agriculture Produce Market Committees (APMCs), it has been decided not to levy the 2% TDS on cash payments above Rs 1 crore made through APMCs, in order to make immediate payments to farmers for their produce. Further to the announcement made by [email protected] on 23-08-2019, an additional 15% depreciatio...

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Depreciation in case of slump sale based on proportionate number of days by transferor and transferee company- Clarify legal position- ICAI

Income Tax - The proviso to section 32 provides that the aggregate deduction, in respect of depreciation of buildings, machinery, plant or furniture, being tangible assets or know how, patents, copyrights, trademarks, licenses, franchises or any other business or commercial rights of similar nature, being intangible assets allowable to the predecessor...

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Section 40(a)(ia) not applies in respect of a claim for depreciation

PCIT Vs Tally Solutions Pvt. Ltd. (Karnataka High Court) - PCIT Vs Tally Solutions Pvt. Ltd. (Karnataka High Court) From close scrutiny of Section 40(a)(i) of the Act, it is axiomatic that an amount payable towards interest, royalty, fee for technical services or other sums chargeable under this Act shall not be deducted while computing the income under the...

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Depreciation eligible on right to collect Adda fees against expense on construction of Bus Terminal 

JCIT (OSD) Vs Rohan And Rajdeep Infrastructure Pvt. Ltd. (ITAT Pune) - Assessee also incurred expenditure in constructing Amritsar Bus Terminal on BOT basis and to recoup said investment, assessee was allowed to collect Adda fees from users of said bus terminal. The said right was business or commercial right in terms of section 32(1)(ii) and was an intangible asset, t...

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Law levying water tax on hydropower projects in Uttarakhand held valid

Alaknanda Hydro Power Co. Lt D. Vs State of Uttarakhand & Others (Uttarakhand High Court) - Alaknanda Hydro Power Co. Ltd. Vs State Of Uttarakhand & Others (Uttarakhand High Court) The claim of the petitioners with regard to the ‘flow measuring devices’ not being installed by the Commission under Section 14.1 of the Act falls in the third alternative of adopting an indirect...

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Depreciation allowable on fixed assets purchased by assessee in cash

Daawat Foods Ltd. Vs ACIT (ITAT Delhi) - Daawat Foods Ltd. Vs ACIT (ITAT Delhi) As far as the disallowance of the depreciation of Rs.93,406/-on the capital expenditure is concerned, we find that AO has disallowed the depreciation on the capital expenditure of Rs.5,35,468/- which has been stated to have been incurred by the assessee in cash...

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Allowability of short-term capital loss on depreciable asset on demolition of building

DCIT Vs Ackruti Safeguard Systems Pvt. Ltd. (ITAT Delhi) - Where the assessee company demolished the existing structure of building which was situated on the leasehold land, for constructing a new factory, and since there was no other asset in the block of assets, therefore, written down value of the said building claimed as short-term capital loss, was rig...

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CBDT notifies Additional depreciation on Motor car & motor vehicles

Notification No. 69/2019-Income Tax [G.S.R. 679 (E).] - (20/09/2019) - Income-tax (9th Amendment) Rules, 2019 – Additional depreciation on motor cars and motor vehicles shall be allowed in certain conditions- Notification No. 69/2019-Income Tax Dated 20th September, 2019. MINISTRY OF FINANCE (Department of Revenue) (CENTRAL BOARD OF DIRECT TAXES) Notification No....

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Commercial rights in the nature of intangible assets eligible for depreciation

I.T.A. No. 496/Delhi/2014 - (15/04/2015) - A reading of the agreement between STL and the assessee clarifies that a specific amount, i.e., Rs.9 Crores was paid by the assessee to the transferor who owned commercial rights towards the network and the facilities. The consideration was a specific value but for which the network would not have b...

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Amendment in Income Tax Rules Related to Depreciation on Fixed Assets

Notification No. 43/2014-Income Tax - (16/09/2014) - Notification No. 43/2014-Income Tax S.O. 2399(E).—In exercise of the powers conferred by Section 295 read with Section 32 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:— 1. (1) Thes...

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MVAT circular on Issuing of Tax Clearance Certificates

Trade Circular No. 1 T of 2010 - (05/01/2010) - In view of this situation, it is necessary that the procedure for the issuing of such certificates should be standardized. Such certificates are very often required to be produced before various government authorities, local bodies or other bodies etc. for the purpose of tender renewal of licenses e...

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Claim for depreciation- Where required particulars not been furnished

Circular : No. 29-D(XIX-14) [F. No. 45/239/65-ITJ], - (31/08/1965) - Numerous instances have come to the notice of the Board where assessee’s claim for depreciation duly shown in the return was not considered by the Income-tax Officer because books of account produced were not properly maintained and it was necessary to estimate profits by invoking the proviso to ...

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Recent Posts in "section 32"

Section 40(a)(ia) not applies in respect of a claim for depreciation

PCIT Vs Tally Solutions Pvt. Ltd. (Karnataka High Court)

PCIT Vs Tally Solutions Pvt. Ltd. (Karnataka High Court) From close scrutiny of Section 40(a)(i) of the Act, it is axiomatic that an amount payable towards interest, royalty, fee for technical services or other sums chargeable under this Act shall not be deducted while computing the income under the head profit and gain of business [&hell...

Read More

Depreciation eligible on right to collect Adda fees against expense on construction of Bus Terminal 

JCIT (OSD) Vs Rohan And Rajdeep Infrastructure Pvt. Ltd. (ITAT Pune)

Assessee also incurred expenditure in constructing Amritsar Bus Terminal on BOT basis and to recoup said investment, assessee was allowed to collect Adda fees from users of said bus terminal. The said right was business or commercial right in terms of section 32(1)(ii) and was an intangible asset, therefore, assessee was entitled to claim...

Read More

Law levying water tax on hydropower projects in Uttarakhand held valid

Alaknanda Hydro Power Co. Lt D. Vs State of Uttarakhand & Others (Uttarakhand High Court)

Alaknanda Hydro Power Co. Ltd. Vs State Of Uttarakhand & Others (Uttarakhand High Court) The claim of the petitioners with regard to the ‘flow measuring devices’ not being installed by the Commission under Section 14.1 of the Act falls in the third alternative of adopting an indirect method for assessment of water drawn by...

Read More

Depreciation allowable on fixed assets purchased by assessee in cash

Daawat Foods Ltd. Vs ACIT (ITAT Delhi)

Daawat Foods Ltd. Vs ACIT (ITAT Delhi) As far as the disallowance of the depreciation of Rs.93,406/-on the capital expenditure is concerned, we find that AO has disallowed the depreciation on the capital expenditure of Rs.5,35,468/- which has been stated to have been incurred by the assessee in cash. We find that the Co-ordinate Bench [&h...

Read More

No more Depreciation allowed on Goodwill

As the budget 2021 unveiled, it came up with the proposals to boost the economy and certain important proposed amendments. One of the proposed amendments was  'No more Depreciation on Goodwill'....

Read More
Posted Under: Income Tax |

Allowability of short-term capital loss on depreciable asset on demolition of building

DCIT Vs Ackruti Safeguard Systems Pvt. Ltd. (ITAT Delhi)

Where the assessee company demolished the existing structure of building which was situated on the leasehold land, for constructing a new factory, and since there was no other asset in the block of assets, therefore, written down value of the said building claimed as short-term capital loss, was rightly allowed by Commissioner (Appeals)....

Read More

Depreciation on Goodwill

Section 2 of the Act provides the definitions for the purposes of the Act. Clause (11) of the said section defines―block of assets‖ to mean a group of assets falling within a class of assets comprising, tangible assets, being buildings, machinery, plant or furniture and intangible assets, being know-how, patents, copyrights, trade-mar...

Read More
Posted Under: Income Tax |

No Depreciation on Goodwill- Finance Bill 2021

A brief analysis of the provisions and how it may impact: Depreciation on Goodwill has been one long debatable issue. Even after Supreme Court Judgment in the case of Smiff Securities Limited wherein the Supreme Court of India held that goodwill of a business is a depreciable asset, taxman have been issuing notices to companies […]...

Read More
Posted Under: Income Tax |

Depreciation on multi-functional printer with xerox Feature

Dimple Vishal Agrawal  Vs ITO (ITAT Ahmedabad)

Dimple Vishal Agrawal  Vs ITO (ITAT Ahmedabad) ITAT held that assessee is entitled for depreciation at the rate of 60% of xerox machine WV-5745. The simple reason is that the ld.CI(A) failed to comprehend true nature of this asset. It has been treated as photo-state machine without going through literature of the machine supplied by [&he...

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Depreciation eligible on Bus Terminal constructed on BOT basis

JCIT (OSD) Vs Rohan and Rajdeep Infrastructure Pvt. Ltd. (ITAT Pune)

JCIT (OSD) Vs Rohan and Rajdeep Infrastructure Pvt. Ltd. (ITAT Pune) Assessee incurred expenditure in constructing Amritsar Bus Terminal on BOT basis and to recoup the said investment, the assessee was allowed to collect add a fees from the users of the said bus terminal. In our view, the said right is business or commercial […]...

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