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2011 (1) TMI 1226 - AT - Income TaxClaim of depreciation on intangible assets - goodwill - facts of the case, the assessee is engaged in the business of mining, export of iron ore, ship and crane building. From the AY under consideration the assessee undertook business of manufacture of pellets after amalgamation of Mandovi Pellets Ltd. ("MPL" for short), into Chowgule and Co. Ltd. as a going concern pursuant to approval of scheme by the order of the HC. HELD THAT:- In this view of the matter there being no goodwill (intangible asset) on which depreciation can be said to have been allowed to the undertaking in the scheme of amalgamation nor any actual cost having been incurred by the amalgamating company as well as by the amalgamated company, the claim made by it in the return of income for the year under consideration with regard to goodwill (intangible asset) which has been found only a fictitious asset in the hands of the appellant and also the claim of depreciation amounting to Rs. 11,51,47,507 being 25 per cent. of Rs. 46,05,90,029 is neither bona fide nor tenable and thus the learned CIT(A) was justified in his conclusion in rejecting the appellant's claim. The appellant has also raised an alternative plea to allow deduction for capital loss. Considering the entire material on record and no specific argument having been made at the time of hearing of this appeal, we find that the assessee has incurred loss in acquisition of an undertaking which is a capital loss to it. The same, therefore, cannot be allowed as deduction and as such the alternative plea so made being devoid of any merit, stands rejected. In the overall conspectus we find no merit in the grounds raised in appeal by the assessee. The same stands rejected and the appeal stands dismissed. In the result, the appeal stands dismissed.
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