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2023 (8) TMI 681 - HC - Income TaxDepreciation on goodwill that was created as a result of amalgamation - whether goodwill is an intangible asset which would clearly fall within the ambit of Explanation 3 to Section 32(1) of the Act? - HELD THAT:- Section 47 in express terms excludes the transfer of a capital asset in terms of a scheme of amalgamation. We further find that the provisions of the Act referred to by learned counsel for the appellant are placed in a Chapter dealing with the “Capital Gains”. That Chapter itself pertains to profits or gains arising from the transfer of a capital asset. However, it is well settled that a transfer in terms of a scheme of amalgamation which is sanctioned is accomplished by operation of law as opposed to an act of parties. It is in that backdrop that the decision in Smifs assumes significance. The judgment rendered in Smifs [2012 (8) TMI 713 - SUPREME COURT] clearly recognises goodwill to be an intangible asset and on which depreciation can clearly be claimed in terms of Section 32(1) of the Act. Decided in favour of assessee.
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