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2018 (5) TMI 2064 - AT - Income TaxDepreciation treating the road under the category allowed as ‘intangible asset’ - HELD THAT:- We are in agreement with the contention of the CIT-DR/DR to the effect that the assessee is not the owner of the asset/road.The assessee made a huge investment for creation of the asset for Govt. Of India and simultaneously acquired certain rights in the property enabling it to earn income by way of collection of toll fee for a specified period, thus, in the process, recovering of its cost of investment with certain amount of profit. In any way, for the assessee, BOT road, bridges etc. as intangible asset and the assessee is claiming depreciation on the very same asset created with its own expenditure. Thus, such an intangible asset comes within the expression ‘other business or commercial rights’. Thus, in our view it falls within the category of any other business or commercial rights of similar nature as provided u/s 32(1)(ii). In the present appeal, the assessee claimed depreciation on road as plant and machinery which was disallowed by the Ld. AO on the plea that the assessee is not the owner of the toll road, hence not eligible for depreciation. To this extent, that the assessee is not the owner of the asset/road, we agree with the contention of the AO as well as the ld. CIT-DR/DR. The issue before us falls within the category of intangible asset. Commissioner of Income Tax (Appeal) allowed depreciation as a building instead of plant and machinery. We feel this is neither building nor a plant and machinery rather the claim of depreciation to the assessee is allowable in the category of commercial rights of similar nature being intangible asset as provided u/s 32 (1)(ii) of the Act. To this extent, only, the additional ground raised by the assessee is allowed at applicable rate of deprecation i.e. @ 25%. As further noted the present road is since 2008-09 and license was granted to the assessee in terms of collecting tax/tolls and the Tribunal for Assessment Year 2008-09, decided the issue in favour of the assessee.
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