TMI Blog2021 (11) TMI 680X X X X Extracts X X X X X X X X Extracts X X X X ..... decided the issue in favour of the assessee by allowing depreciation @ 60%. Also see AMWAY INDIA ENTERPRISES. VERSUS DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE - 1(1), NEW DELHI. [ 2008 (2) TMI 454 - ITAT DELHI-C] - Decided against revenue. - ITA No. 5263/Del/2018 - - - Dated:- 9-11-2021 - G.S. Pannu, (President) And Kul Bharat, Member (J) For the Appellant : Hiten Chande, CA For the Respondents : Umesh Takyar, Sr. DR ORDER Per Kul Bharat, JM The present appeal filed by the Revenue for the assessment year 2014-15 is directed against the order of Ld. CIT(A)-22, New Delhi dated 14.05.2018. The Revenue has raised following grounds of appeal:- 1. Whether, the Ld. CIT (A) has erred on facts and in law in allowin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ( PAS ) against the rate of 25% allowed by the Assessing Officer treating the same as an intangible assets. 3. Facts giving rise to the present appeal are that the assessee filed its return of income on 28.11.2014 declaring loss of ₹ 11,11,33,504/-. The case was selected for scrutiny under CASS and the assessment was framed vide order dated 14.12.2016. Thereby, the Assessing Officer disallowed the claim of the assessee of depreciation @ 60% and restricted the same to the extent of 25%. The difference was added to the total income of the assessee amounting to ₹ 2,45,22,452/-. 4. Aggrieved against this, the assessee preferred appeal before Ld. CIT(A) who after considering the submissions and relying upon various judicial pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0%. The AO restricted the same as 25% on the basis that software falls under the definition of intangible assets and allowable deprecation is 25%. In appeal Ld. AR submitted that the appellant has acquired the right to use the software required for mortgage guarantee business in India. The Ld. AR further argued on the basis of various case laws that computer software can not work in isolation and it has to be loaded on computer, so it is a part of computer and depreciation is allowable @ 60%. The Ld. AR relied on the following decisions: I. ACIT vs. i-Flex Solutions Ltd. [2010] (42 SOT 7) Mumbai ITAT. II. ACIT vs. Zydus Infrastructure (P.) Ltd. [2016] 161 ITD 611, Ahmadabad, ITAT III. Visual Graphics Computing Services India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to the decision in the case of Bimetal Bearings Ltd. Vs. State of Tamil Nadu [reported in (1991) 80 STC 167] and held as hereunder: 9. The Hon'ble Division Bench took note of the decision of the Hon'ble Supreme Court pointing out that the 'entry' to be interpreted is in a taxing statute; full effect should be given to all words used therein and if a particular article would fall within a description, by the force of words used, it is impermissible to ignore the description, and denote the article under another entry, by a process of reasoning. 10. It was further pointed out that the rule of construction by reference to contemporanea expositio is a well-established rule for interpreting a statute by reference to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13. So far as the second substantial question of law is concerned, which arises only for the assessment year 2014-15, the Tribunal accepted the case of the assessee by interpreting the non compete clause in the agreement, which has been reproduced in paragraph 25 of the impugned order. After analyzing the same, the Tribunal held that the tenor of the agreement was only 18 months and it could not be stated that the assessee derived any enduring benefit due to the payment effected by it for obtaining certain commitments from one Mr. V. Shankar and restricting himself from indulging http://www.judis.nic.in in any competition with the business of the assessee or from weaning way the employees. 14. The Tribunal took note of the decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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