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M/s Motilal Oswal Commodities Broker Pvt. Ltd., Versus Dy. Commissioner of Income Tax – CC -22, Mumbai and vice-versa

2014 (5) TMI 1125 - ITAT MUMBAI

Depreciation on membership rights of Multi Commodity Exchange - Held that:- In the present case assessee has paid non-refundable admission fees for acquiring trading rights in Multi Commodity Exchange Ltd. The said capital expenditure was eligible for depreciation u/s 32 of the Act. See case of Techno Shares and Stocks Ltd. [2010 (9) TMI 6 - SUPREME COURT OF INDIA] - Decided in favour of assessee - I .T.A. No.7375/Mum/2010, I .T.A. No.8217/Mum/2010 - Dated:- 7-5-2014 - SHRI P.M. JAGTAP, AM AND S .....

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ue, the relief allowed by the ld. CIT(A) which is disputed therein is only to the extent of ₹ 7,85,679/- and the tax effect involved in the appeal of the Revenue is less than the monetary limit of ₹ 3 lacs fixed by the CBDT vide Instruction No. 3 of 2011 dated 9-2-2011 reported in (2011) 332 ITR 1 (Statutes) for filing the appeals before the Tribunal. The ld. D.R. has not disputed this position clearly evident from the orders of the authorities below. In CIT vs. Madhukar K. Inamdar ( .....

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Ltd. decided on 29-8-2011. 3. Keeping in view the judicial pronouncements discussed above and CBDT Instruction No. 3 of 2011 dated 9-2-2011, we hold that the present appeal filed by the Department involving tax effect of less than ₹ 3 lacs is not maintainable and the same is liable to be dismissed at the threshold. 4. In so far as the appeal of the assessee is concerned, the solitary issue involved therein relates to the disallowance of ₹ 1,42,500/- made by the A.O. and confirmed by .....

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d by the assessee @ 25% on the amount of ₹ 7,60,000/- paid for acquiring rights of Multi Commodities Exchange claiming that it was intangible asset in the form of commercial right as per provisions of section 32(1)(ii) of the income Tax Act, 1961 as amended w.e.f. 1-4-1998. This claim of the assessee, however, was not found acceptable by the A.O. for the following reasons:- 1) The MCX membership right is not an asset but a deposit or a personal privilege granted to a member for trading rig .....

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ties Exchange. On appeal, the ld. CIT(A) confirmed the said disallowance made by the A.O. holding that the issue was already settled against the assessee by the Hon ble Bombay High Court in the case of CIT vs. Techno Shares & Stocks Ltd. (supra). Aggrieved by the order of the ld. CIT(A), the assessee has preferred this appeal before the Tribunal. 7. We have heard the arguments of both the sides and also perused relevant material available on record. As submitted by the ld. Counsel for the as .....

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his Tribunal in the case of Sino Securities (P.) Ltd. Vs. ITO [2012] 134 ITD 321 (Mum) and in the case of Sunidhi Consultancy Services vs. DCIT reported in [2012] 50 SOT 223 (Mum), it is observed that the claim of depreciation made by the assessee in these cases was in respect of shares issued by the Bombay Stock Exchange in lieu of membership cards under the scheme of Corporatisation and Demutualisation and keeping in view the said scheme, it was held by the Tribunal that depreciation claimed b .....

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