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2012 (5) TMI 162 - AT - Income TaxDepreciation on the intangible assets - purchase of franchise for a consideration of ₹ 5.51 crores. - it was contended that the assessee has not acquired any particular asset but it is a case of transfer of a on-going concern. - held that:- AFL transferred its rights of business and business network with respect to the money transfer business being the representative of the Western Union network. It is clear that it is not the case of entire on going concern i.e AFL or its brand name; but only business rights in respect of one of its various businesses. In the case of intangible asset being commercial/business rights diminution in value or physical wear and tear is not an essential condition for admissibility for depreciation u/s 32, if the assets used as a business tool for earning the income. The assessee paid the consideration for the purpose of enhancing its network in the field of money transfer business by acquiring the rights over infrastructure and other advantage attached to the marketing network and hence, the same falls under the category of intangible asset as contemplated u/s 32(1)(ii) of the IT Act. - Decided in favor of assessee.
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