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2016 (2) TMI 187 - AT - Income TaxDeduction u/s. 35D(2)(c)(iv) - CIT(a) allowed the claim - Held that:- It is a well settled law that the expenditure incurred on issue of fresh share and expansion of capital base is capital in nature. Thus, in view of the law laid down in the case of Brooke Bond India Ltd. Vs. Commissioner of Income Tax reported as [1997 (2) TMI 11 - SUPREME Court ] we are of the view that the Commissioner of Income Tax (Appeals) has erred in allowing deduction claimed by the assessee on expenditure for increasing the authorized share capital of the assessee. The findings of the Commissioner of Income Tax (Appeals) on this issue are reverse and the appeal of the Revenue is allowed. Depreciation claimed on payment of non-compete fees - Held that:- Non-compete payment is capital in nature and falls in the category of an intangible asset. Thus, non-compete payment is eligible for depreciation u/s. 32(1)(ii) of the Act. Disallowance of depreciation claimed on goodwill u/s. 32(1)(ii) - Held that:- Following the decision rendered in the case of Commissioner of Income Tax Vs. Smifs Securities Ltd. (2012 (8) TMI 713 - SUPREME COURT ), the Hon'ble Bombay High Court in the case of Commissioner of Income Tax Vs. Birla Global Asset Finance Co. Ltd. (2012 (8) TMI 773 - BOMBAY HIGH COURT ) held that depreciation in respect of intangible assets constituting goodwill is allowable.
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