Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (4) TMI 1193 - AT - Income TaxDisallowance on account of depreciation on brands under section 32(1)(ii) - whether the brand is not an intangible asset? - Held that:- Brand name is an intellectual property right similar to knowhow, patents, trademarks and therefore the same is eligible for depreciation under section 32(1)(ii). See KEC International Ltd. vs. ACIT [2010 (6) TMI 523 - ITAT, MUMBAI]. The Ld. A.R. has further brought our attention to the fact that in earlier assessment years right from the year 2002-03 up to A.Y. 2005-06, the assessee has been consistently been allowed depreciation on the brand name. In view of this, we do not find any justification on the part of authorities in disallowing the claim of depreciation on the brands for the year under consideration. - Decided in favour of the assessee Addition of contingent liabilities - Held that:- A.R. has brought our attention to the opening lines of para 5.2 of the assessment order wherein the Assessing Officer has categorically mentioned that the contingent liabilities have neither been debited nor credited in the profit and loss account. The Ld. A.R. has further demonstrated from the balance sheet that such liabilities have never been claimed by the assessee as part of expenditure. When the assessee had not claimed the said liability as part of expenditure in the return of income, then there was no question of any disallowance of the same. The additions made by the AO in this respect are totally unwarranted. This issue is also accordingly allowed in favour of the assessee.
|