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2014 (10) TMI 175 - ITAT AHMEDABADClaim of depreciation u/s 32 - Depreciation on the Mumbai Premises purchased, possessed and owned by the company, was put to use during the year – Whether the assessee would be entitled for the depreciation as claimed despite the undisputed fact that the assessee had only purchased the building during the year under consideration and carried out certain furnishing work for the purpose of establishing the “Bath Studio” - Held that:- The assessee had purchased the premises on 05/03/2007 and for the purpose of “Bath Studio” the furnishing and other work were carried out from March-07 to 31st May-2007 – as decided in CIT vs. India Tea and Timber Trading Co. [1996 (6) TMI 83 - GAUHATI High Court] - the word “used” for business purpose should have a wider import including active as well as passive usage of the asset. Also in Commissioner Of Income-Tax, Gujarat Versus Suhrid Geigy Limited [1981 (4) TMI 79 - GUJARAT High Court] it has been held that depreciation was claimed by the assessee with effect from the date on which trail production was commenced - there was a time lag between the date when the trial production commenced and the date when the actual production commenced - the date on which the trial production commenced was irrelevant for the purposes of claiming depreciation and that it cannot be said that the company had set up its business at the point of time when the trial production had commenced - the company had not commenced its business from the standpoint of the right to claim depreciation for the user of a building or machine in the business of the assessee-company - although the assessee had purchased the building for business purpose and furnishing of the same was being carried out for actual use - the arguments of the assessee cannot be accepted – Decided against assessee. Deduction on amortization of ESOP Scheme - Deduction allowable u/s 28 r.w. section 37 or not – Held that:- The assessee has claimed business expenditure on ESPO – following the decision in Biocon Ltd. Vs. Dy.CIT [2013 (8) TMI 629 - ITAT BANGALORE] - the assessee-company was a closely held company in the previous year and as such there was no question of listing of its shares and having some market price at the time of grant of options - Ordinarily, the amount of discount on premium which is written off over the vesting period represents the market price of the shares listed on the stock exchange on the date of grant of option as reduced by the price at which option is given to the employees - since there was no availability of any market price of such shares on the date of grant of option as the company came to be listed on a stock exchange in a subsequent year – Decided in favour of assessee.
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