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2022 (9) TMI 1365 - AT - Income TaxDepreciation on "Toll Road" - intangible asset - to be allowed @ 15% or 25% - HELD THAT:- As it is evident that such a claim of the assessee has been allowed in the previous assessment years and therefore, it cannot be denied that the assessee was under a bona fide belief that it has correctly claimed deduction of depreciation on toll road by treating the same as ‘plant and machinery’ at 15%, in view of the consistent findings in its own case. However, subsequently, due to change in legal position, the claim of deduction of depreciation by treating the road as ‘plant and machinery’ was disallowed on the basis that assessee cannot be treated as owner of the toll road. The coordinate bench of the Tribunal in assessee’s own case in ACIT vs M/s West Gujarat Expressway Ltd. [2015 (5) TMI 305 - ITAT MUMBAI] for assessment year 2009–10, accepted the alternative plea of the assessee and in Para 28 of its order held that assessee is entitled to collect toll tax, which is an intangible commercial right under section 32(1)(ii) of the Act, at the rate as has been prescribed under the relevant rules. It is the golden rule of tax, as laid down in Article 265 of the Constitution of India that no tax can be collected except by authority of law. It is also well established that if the assessee, under a mistake, misconception or on not being properly instructed is over assessed, the authorities under the Act are required to assist him and ensure that only legitimate tax dues are collected. From the record, it is evident that it is not the case where the Revenue is alleging that rate of depreciation in case of intangible assets is 15% instead of 25% as claim by the assessee. Thus, once the right to collect the toll tax has been held to be intangible asset by the CIT(A), by following the judicial precedents in assessee’s own case, we are of the considered view that the learned CIT(A) erred in denying deduction of depreciation at the rate of 25% and restricting the same to 15% by referring to the claim made under the return of income. We are further of the view that once asset has been characterised under the particular head i.e., ‘intangible asset’ in the present case, all the other consequences including the rate at which depreciation is allowable under the law follows. Therefore, in view of the above, we direct the AO to grant depreciation on toll road at the rate applicable in case of intangible assets i.e. at 25%. As a result, grounds raised by the assessee are allowed. Taxability of interest income - whether interest income is linked to the business activities of the assessee? - HELD THAT:- We find that while deciding similar issue in assessee’s own case for assessment year 2009–10, the Co-ordinate Bench of the Tribunal [2015 (5) TMI 305 - ITAT MUMBAI] held that interest income from fixed deposit is business income. - Decided against revenue.
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