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2023 (9) TMI 616 - HC - Income TaxClaim of Depreciation on the brands used by assessee - intangible assets or not? - Whether the claim for depreciation on the brands used by assessee, concerning its paper manufacturing business, were intangible assets within the meaning of Section 32(1)(ii) and hence, amenable to the claim of depreciation? - HELD THAT:- A careful perusal of Section 32(1)(ii) of the Act, read with clause (b) of Explanation 3 would show that trademarks are covered under the said provision. Brand names are a specie of the trademark. This is evident upon reading the definition of “trademark” and “mark” provided in the allied statute i.e., Trademarks Act, 1999 [in short, “TM Act”]. A perusal of the definition would show that the trademark means a mark which is capable of being represented graphically, and is capable of distinguishing the goods or services of one person from those of others, and may include the shape of goods, their packaging, and combination of colours. The expression “mark” which is defined in Section 2(m) of the TM Act, includes, among others, a "brand" - a conjoint reading of these Sections would clearly point in the direction that the expression “trademark” under Section 32(1)(ii) and in the appended Explanation i.e., Explanation 3(b) would clearly include brand names. A careful perusal of clause (b) of Explanation 3 extracted hereinabove shows that the definition of assets, as explained in the Explanation, includes commercial rights of similar nature. Brand names certainly invest in the owner commercial rights, and therefore, will fall within the scope of intangible assets, which are amenable to depreciation u/s 32(1)(ii) - No substantial question of law.
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