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2013 (1) TMI 646 - AT - Income TaxDisallowance of depreciation on intangible asset – Depreciation on Goodwill - Assessee is a share broker and the main source of income is generated through brokerage – Assessee has purchased entire clientele business of M/s. AFC Pvt. Ltd. by assigning all clients to the assessee for a consideration of ₹ 2.50 crores. - Booked these expenses as purchase of goodwill and has claimed 25% of depreciation - Held that:- It cannot be denied that by getting a right over 3709 clients of M/s. AFC, such right is used as a tool to carry on the business by the assessee. Merely because the assessee showed the payment to be on account of goodwill in the books of account, no adverse inference could be drawn against the assessee. Following the decision in case of Smifs Securities Ltd. (2012 (8) TMI 713 - SUPREME COURT) that goodwill is an asset eligible for depreciation. It can also be seen from the angle of purchase of entire marketing network by the assessee from M/s. AFC even if considered from this angle the assessee is eligible for depreciation – In favour of assessee TDS on Subscription for e-magazine/journal – Disallowance u/s 40(a)(ia) – Held that:- Assessee made the payment for terminal charges for on line information and data base access and retrieval services and therefore, no TDS was required to be deducted as the payment was for a subscription of financial e-magazine – In favour of assessee
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