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2014 (1) TMI 443 - AT - Income TaxEligibility to claim depreciation u/s 32(1)(ii) of the Act – Right to collect toll treated as intangible asset – Held that:- The ‘Right to collect the Toll’ is emerging as a result of the costs incurred by the assessee on development, construction and maintenance of the infrastructure facility - The right is not of the nature referred to in section 32(1)(ii) of the Act for the reason that the agreement with the Government of Madhya Pradesh only allowed the assessee to recover the costs incurred for constructing the road facility whereas section 32(1)(ii) of the Act required that the assets mentioned should be acquired by the assessee after spending money - it is wrong to say that right acquired by the assessee was without incurrence of any cost. It is quite evident that assessee got the right to collect toll for the specified period only after incurring expenditure through its own resources on development, construction and maintenance of the infrastructure facility - section 32(1)(ii) permits allowance of depreciation on assets specified being ‘intangible assets’ which are wholly or partly owned by the assessee and used for the purposes of its business - The condition is fully satisfied by the assessee - the assessee was eligible for depreciation on the ‘Right to collect Toll’, being an ‘intangible asset’ falling within the purview of section 32(1)(ii) of the Act – Decided against Revenue.
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