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2019 (1) TMI 1349 - AT - Income TaxDenial of depreciation on goodwill and intangibles - excess of consideration paid for acquisition of Pharma and Food division of L&T - assessee company is engaged in the business of Engineering, Procurement and Construction(EPC) of Food, Diary, Chemical and Pharma Plants - Held that:- The assessee while acquiring Food and Pharma division of L& T vide agreement dated 26.05.2005 had paid consideration in excess of net asset value of the said divisions of L&T as on the date of takeover and consequently, the excess was reflected as Goodwill in the books of accounts of the assessee under the head ‘Intangibles’ and we are of the considered view that the assessee will be entitled for claiming depreciation on the said excess consideration being Goodwill as the same being ‘any other business or commercial rights of similar nature’ as defined in Explanation 3 to Section 32(1) of the 1961 Act , keeping in view ratio of decision of Hon’ble Supreme Court in the case of CIT v. Smifs Securities Limited [2012 (8) TMI 713 - SUPREME COURT] as held that the excess consideration paid over and net asset value of the business acquired shall be goodwill being ‘any other business or commercial rights of similar nature’ and will be entitled for depreciation u/s 32 - Decided in favour of assessee
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