TMI Blog2017 (9) TMI 1350X X X X Extracts X X X X X X X X Extracts X X X X ..... confirmed by Hon’ble Supreme Court, we noted that no contrary decision was brought to our notice. Therefore we confirm the order of Ld. CIT(A) deleting the said disallowance. - Decided in favour of assessee Depreciation @ 60% on UPS confirmed - See CIT vs. BSES Yamuna Powers Ltd. [2010 (8) TMI 58 - DELHI HIGH COURT ] Claim of depreciation u/s 32(1)(ii) - treating the non computation right as intangible capital assets - Held that:- After hearing the rival submissions, we do agree that each decision has to be applied on the facts and context therein. In the case of the assessee, we noted that the terms and conditions of the agreement has not been examined by A.O. to the right perspective and has not been compared with the facts and circ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngible capital asset for the purpose of section 32(1)(ii) of the Income Tax Act and in directing the A.O. to treat the same as intangible capital asset and to allow depreciation thereon. 2. Ground no.1 relate to deletion of addition of ₹ 3,55,234/- made u/s 14A r.w. Rule 8D. 2.1. After hearing rival submissions and going through the orders of the tax authorities below, we noted that the Ld. CIT(A) has deleted the said disallowance by holding as under. 4.4 Now adverting to the case of the appellant company, it is seen that the Assessing Officer has made the disallowance of expenditure u/s 14A read with rule 80 of the IT Rules without recording any reason for doing so. It is observed that the measure investment during th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. Reliance in this regard is placed on the decision of Hon ble ITAT, Delhi in the case of M/s Jindal Photo Ltd. vs. DCIT (2011- TIOL-653-ITAT-Del) wherein it was held that Rule 8D cannot be invoked in the case of an assessee without recording any satisfaction about the incorrectness of the claim of that assessee. On these facts and circumstances of the case, the A.O. is directed to delete the addition made u/s 14A r.w.rule 8D of the Act of ₹ 3,55,234/-. 2.2. The Ld. DR even though vehemently relied on the order of the Assessing Officer to prove that the satisfaction has duly been recorded, but in our opinion the satisfaction u/s 14A before applying Rule 8D had to be recorded with reference to the books of accounts that the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is, therefore, apparent that the ruling in Techno Shares Stocks Ltd. (supra) was concerned with an extremely limited controversy, i.e. depreciability of stock exchange membership. This Court observes that such nature was held to be akin to a license because it enable the member, for the duration of the membership, to access the Stock Exchange. Undoubtedly, it conferred a business advantage and was an asset which and was clearly an intangible asset. The question here, however, is whether a non-compete right of the kind acquired by the assessee against L T for seven years amounts to a depreciable intangible asset. As discussed earlier, each of the species of rights spelt-out in Section 32(1)(ii), i.e. know-how, patent, copyright, trademark, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd other advantages such as know-how, franchise, license etc. and even those considered by the Courts, such as goodwill can be said to be alienable. Such is not the case with an agreement not to compete which is purely personal. As a consequence, it is held that the contentions of the assessee are without merit; this question too is answered against the appellant and in favour of the Revenue. 4.2. Ld. AR on the other hand vehemently contended that against the said order of the Delhi High Court an SLP has been admitted by the Hon ble Supreme Court in SLP CC No.19939/2015 which was listed last on 19.9.2017 and admitted on 16.11.2007. The Ld.AR before us also referred to a chart mentioning therein that the facts of this case are different ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut the same business. 5. After hearing the rival submissions, we do agree that each decision has to be applied on the facts and context therein. In the case of the assessee, we noted that the terms and conditions of the agreement has not been examined by A.O. to the right perspective and has not been compared with the facts and circumstances in the case of Sharp Business Systems(supra). We, therefore, in the interest of justice set aside the order of Ld. CIT(A) and restore this issue to the file of the Assessing Officer with the direction that the Assessing Officer shall redecide this issue afresh after comparing the facts in the case of the assessee with the case of Delhi High Court in Sharp Business Systems (supra) in acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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