“intangible assets”

DepreciationSection 32(1)(ii)Section 32(1)(ii)1,121 judgments

The decision most relied on for intangible assets is CIT v. B.C. Srinivasa Setty (128 ITR 294), cited in 628 judgments on BharatTax.

Leading authorities on intangible assets

CIT v. B.C. Srinivasa Setty

128 ITR 294 · 1981 · Supreme Court

628

citing judgments

When the cost of acquisition of a capital asset cannot be determined, the computation mechanism for capital gains fails, and thus no capital gains can be charged. This establishes a broader principle that a charging section cannot operate in the absence of specific machinery provisions for computation.

CIT v. Smifs Securities Ltd.

348 ITR 302 · 2012 · Supreme Court

540

citing judgments

Goodwill, whether arising from an amalgamation or a slump sale, is an intangible asset eligible for depreciation under Section 32(1) of the Income-tax Act. While the assessee must prove the existence and valuation of such goodwill, it is recognized as a depreciable asset.

Techno Shares and Stocks Ltd. v. CIT

327 ITR 323 · 2010 · Supreme Court

130

citing judgments

Membership rights and business contracts, as 'business or commercial rights of similar nature' to a license or franchise, qualify as intangible assets eligible for depreciation under Section 32(1)(ii) of the Income-tax Act.

Amway India Enterprises v. DCIT

111 ITD 112 · 2008 · ITAT

127

citing judgments

Depreciation is allowable on computer software, including software licenses, at the rate of 60%.

Areva T&D India Ltd. v. DCIT

345 ITR 421 · 2012 · High Court

citing judgments

Business contracts and commercial rights of similar nature qualify as intangible assets under Section 32(1)(ii) and are eligible for depreciation. The decision also affirms that goodwill is an intangible asset eligible for depreciation.

CIT v. Tata Services Ltd.

122 ITR 594 · 1980 · High Court

citing judgments

A right to purchase property under an agreement to sell is a capital asset as defined under Section 2(14) of the Income-tax Act. The relinquishment or extinguishment of such a right constitutes a transfer of a capital asset, the consideration for which is taxable as capital gains.

Guffic Chem (P.) Ltd. v. CIT

332 ITR 602 · 2011 · Supreme Court

citing judgments

Compensation received for a non-compete covenant or for not carrying on a specific business activity is a capital receipt and not liable to tax as business income.

ACIT v. Progressive Constructions Ltd.

92 Taxmann.com 104 · 2018 · ITAT

citing judgments

Rights acquired under a concession agreement for highway construction, which generate revenue through toll collections, constitute an 'intangible asset' under section 32(1)(ii) of the Income-tax Act, 1961, eligible for depreciation, typically at 25%. This includes claiming depreciation on the opening Written Down Value (WDV) for such highway projects.

Judgments citing intangible assets

Wns Global Services Private Limited, Mumbai vs. Assistant Comm. of Income Tax -14(1)(2), Mumbai

ITA 2451/MUM/2022[2017-18]Status: DisposedITAT Mumbai26 Jul 2023AY 2017-18

Bench: Vikas Awasthy () & Ms. Padmavathy S. ()

Section 143(1)Section 143(3)Section 14ASection 234CSection 43BSection 92C

disallowance under section 14A to the tune of Rs.5,47,14,762/- and also made an addition on account of disallowance depreciation on intangible assets amounting to Rs.33,72,60,635/-. Aggrieved, the assessee filed its objections before the DRP. The Ld.DRP gave partial relief to the assessee whereby ... Tribunal, we hold that there cannot be any TP adjustment. These grounds are allowed in favour of the assessee Disallowance of depreciation on intangible assets – Ground No.11 12. During the year, the assessee has claimed depreciation of Rs.33,72,60,637/- as per the details given below:- Parties Nature

Wns Global Services Private Limited, Mumbai vs. Assistant Comm. of Income Tax-14(1)(2), Mumbai

ITA 2450/MUM/2022[208-2019]Status: DisposedITAT Mumbai26 Jul 2023

Bench: Vikas Awasthy () & Ms. Padmavathy S. ()

Section 143(1)Section 143(3)Section 14ASection 234CSection 43BSection 92C

DCIT, Circle- 25(1), New Delhi vs. Telecommunication Consultants India Ltd., New Delhi

ITA 3801/DEL/2018[2013-14]Status: DisposedITAT Delhi26 Jul 2023AY 2013-14

Bench: Sh. N.K.Billaiya & Sh.Anubhav Sharmaita No. 3801/Del/2018, A.Y. 2013-14 Dcit, Vs. M/S.Telecommunication Circle-25(1), Consultants India Ltd. New Delhi 106, Plot No. 4, Vishwadeep Tower, District Centre, Janakpuri, New Delhi-110058 Pan : Aaact0061H Appellant Respondent

Section 143(3)Section 32

assessee had claimed depreciation at the rate of 25% on its right to build and operate in transfer arrangement by treating the same is intangible asset. However, Ld. AO restricted depreciation to 7.41%. 4.1 Ld. DR submitted that Ld. CIT(A) has failed to appreciate the fact that ... appreciated from the orders of ld. CIT(A) that the fact that rights under BOT projects have been considered to be intangible assets in the light of judgment of Hyderabad Bench in DCIT Hyderabad M/s. Progressive Construction limited, Hyderabad, ITA no. 214/Hyd./2014 and Ld. CIT(A) has also appreciated

ACIT- Circle-4(2)(1), Mumbai vs. First Advantage Private Limited, Mumbai

In the result, the appeal of the revenue is dismissed

ITA 1704/MUM/2023[2018-2019]Status: DisposedITAT Mumbai24 Jul 2023AY 2018-2019

Bench: Shri Amit Shukla & Shri Amarjit Singhacit, Circle 4(2)(1) Vs. First Advantage Private Room No. 640/642, 6Th Limited, First Floor, Floor, Aayakar Bhavan, Interface Building No.7, M.K. Road, Link Road, Malad (West) Mumbai – 40 Mumbai – 400064 स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aaacq0706E Appellant .. Respondent [ Appellant By : Ms. Zeenia Handa Respondent By : Nitesh Joshi & Sunil Jhunjhunwala Date Of Hearing 19.07.2023 Date Of Pronouncement 24.07.2023 आदेश / O R D E R Per Amarjit Singh (Am): This Appeal Filed By The Revenue Is Directed Against The Order Passed By The Ld. Cit(A) Nfac, Dated 14.03.2023 For A.Y. 2018-19. The Assessee Has Raised The Following Grounds Before Us: “1. Whether On The Facts & Circumstances Of The Case & In Law The Ld. Citia) Erred In Deleting The Disallowance Made Under Section 37(1) Of The Act For An Amount Of Rs.2,01,96,568/- Incurred Towards Software License Expenses By Considering The Same As Revenue Expenditure. 2. Whether On The Facts & Circumstances Of The Case & In Law The Ld. Cit(A) Has Erred In Considering The Expenses Incurred By The Assessee On Software License Fee As Revenue Expenditure Instead Of Capital Expenditure, Without Appreciating The Fact That It Is An "Intangible Asset. The Income-Tax Act Clearly Categorizes The "License" As An Intangible Assets For Claiming Depreciation U/S 32 Which Is Based On The Ordinary Meaning Of The Same."

For Appellant: Ms. Zeenia HandaFor Respondent: Nitesh Joshi &

Section 143(2)Section 32Section 37(1)

expenses incurred by the assessee on software License Fee as revenue expenditure instead of capital expenditure, without appreciating the fact that it is an "Intangible asset. The Income-tax act clearly categorizes the "License" as an intangible assets for claiming depreciation u/s 32 which is based on the ordinary meaning

DCIT, Central Circle-17, New Delhi vs. Caddie Hotels Pvt Ltd., New Delhi

In the result the appeal of the assessee in ITA No

ITA 1724/DEL/2022[2017-18]Status: DisposedITAT Delhi21 Jul 2023AY 2017-18

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Shri Ajay Vohra, AdvFor Respondent: Shri T. James Singson, CIT- DR

Section 143(3)Section 263Section 56(2)Section 56(2)(viib)

company to the satisfaction of the Assessing Officer, based on the value, on the date of issue of shares, of its assets including intangible assets being goodwill, know-how, patents, copyrights trademarks, licences, franchises ar any other business or commercial rights of similar nature, whichever is higher (b) venture capital

DCIT, Central Circle-17, New Delhi vs. Caddie Hotels Pvt. Ltd., Delhi

In the result the appeal of the assessee in ITA No

ITA 1723/DEL/2022[2016-17]Status: DisposedITAT Delhi21 Jul 2023AY 2016-17

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Shri Ajay Vohra, AdvFor Respondent: Shri T. James Singson, CIT- DR

Section 143(3)Section 263Section 56(2)Section 56(2)(viib)

DCIT, Central Circle-17, New Delhi vs. Caddie Hotels P.Ltd, New Delhi

In the result the appeal of the assessee in ITA No

ITA 1722/DEL/2022[2015-16]Status: DisposedITAT Delhi21 Jul 2023AY 2015-16

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Shri Ajay Vohra, AdvFor Respondent: Shri T. James Singson, CIT- DR

Section 143(3)Section 263Section 56(2)Section 56(2)(viib)

DCIT, Central Circle-17, New Delhi vs. Caddie Hotels P.Ltd, New Delhi

In the result the appeal of the assessee in ITA No

ITA 1721/DEL/2022[2014-15]Status: DisposedITAT Delhi21 Jul 2023AY 2014-15

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Shri Ajay Vohra, AdvFor Respondent: Shri T. James Singson, CIT- DR

Section 143(3)Section 263Section 56(2)Section 56(2)(viib)

Caddie Hotels Pvt. Ltd., Delhi vs. Pr. CIT Central Circle 17, Delhi

In the result the appeal of the assessee in ITA No

ITA 2014/DEL/2021[2014-15]Status: DisposedITAT Delhi21 Jul 2023AY 2014-15

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

For Appellant: Shri Ajay Vohra, AdvFor Respondent: Shri T. James Singson, CIT- DR

Section 143(3)Section 263Section 56(2)Section 56(2)(viib)

Viney Corporation Limited, New Delhi vs. ACIT, New Delhi

In the result, the appeal of the assessee is partly allowed for statistical purposes

ITA 1409/DEL/2021[2015-16]Status: DisposedITAT Delhi21 Jul 2023AY 2015-16

Bench: Shri Kul Bharat & Shri M.Balaganesh[Assessment Year : 2015-16] Viney Corporation Ltd., Vs Acit, E-872, 1St Floor, Saraswati Vihar, Circle-26(2), Pitampura, New Delhi-110034. New Delhi. Pan-Aaacv0446L Appellant Respondent Appellant By Shri R.K.Kapoor, Ca Respondent By Ms. Swati Joshi, Cit Dr Date Of Hearing 30.05.2023 Date Of Pronouncement 21.07.2023

Section 143(3)Section 154Section 32(1)(iia)

furniture, being tangible assets; (ii) know-how, patents, copyrights, trade marks, licenses, franchises or any other business or commercial rights of similar nature, being intangible assets acquired on or after the 1st day of April, 1998,owned, wholly or partly, by the assessee and used for the purposes

The Dy. Commr. of Income Tax, Gandhidham Circle, Gandhidham vs. M/S P.C. Patel & Company, Bhuj

In the result, the appeal filed by the Revenue is hereby dismissed

ITA 24/RJT/2020[2015-16]Status: DisposedITAT Rajkot21 Jul 2023AY 2015-16

Bench: Smt. Annapurna Gupta (Accountant Member), Shri T.R. Senthil Kumar (Judicial Member)

Section 143(3)

brevity] provides for depreciation in respect of buildings, machinery, plant or furniture, being tangible assets as well as certain intangible assets owned wholly or partly by the assessee and used for the purpose of the business or profession, at the prescribed rates. New Appendix I, which is applicable

Extol Wind Ltd, Bhopal vs. The ITO Ward 1 (3), Bhopal

In the result, appeal of assessee is allowed for statistical purposes

ITA 30/IND/2023[2014-15]Status: DisposedITAT Indore14 Jul 2023AY 2014-15

Bench: Shri Vijay Pal Rao & Shri B.M. Biyaniextol Wind Ltd. Ito Ward 1(3) 104, Jahangirbad Barkhedi Bhopal Vs. Road, Bhopal (Appellant / Assessee) (Respondent/ Revenue) Pan: Aaace 8607 N Assessee By Shri Pawan Ved, Ar Revenue By Shri Ashish Porwal, Sr. Dr Date Of Hearing 11.07.2023 Date Of Pronouncement 14.07.2023

Section 56(2)(viib)

prescribed or as may be substantiated by the company to the satisfaction of the AO based on the value of assets including intangible assets on the date of issue of shares. It is asset including intangible assets whichever is higher. For ready reference we reproduce clause (a) of explanation ... company to the satisfaction of the Assessing Officer, based on the value, on the date of issue of shares, of its assets, including intangible assets being goodwill, know-how, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature, whichever is higher, 8. Therefore

Joint Commissioner of Income Tax (OSD) Circle-3, Ferozepur vs. Measage Om Sons Marketing Private Limited, Faridkot

In the result, the appeal of the revenue bearing ITA No

ITA 407/ASR/2019[2015-16]Status: DisposedITAT Amritsar07 Jul 2023AY 2015-16

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

Section 143(3)Section 250(6)Section 37(1)Section 56(2)(viib)

company to the satisfaction of the Assessing Officer, based on the value, on the date of issue of shares, of its assets, including intangible assets being goodwill, know-how, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature, whichever is higher;” The relevant extract

The ACIT Cir 6(3), Mumbai vs. M/S. Grasim Industries Ltd, Mumbai

In the result, the appeal by the Revenue is dismissed

ITA 3854/MUM/2006[2005-2006]Status: DisposedITAT Mumbai04 Jul 2023AY 2005-2006

Bench: Shri Amarjit Singh & Shri Sandeep Singh Karhail

For Appellant: Shri J.D. Mistri a/wFor Respondent: Dr. Kishor Dhule

Section 142(1)Section 143(2)Section 143(3)Section 250Section 43B

assets" means a group of assets falling within a class of assets comprising— (a) tangible assets, being buildings, machinery, plant or furniture; (b) intangible assets, being know-how, patents, copyrights, trade-marks, licences, franchises or any other business or commercial rights of similar nature, in respect of which the same ... furniture, being tangible assets; (ii) know-how, patents, copyrights, trade marks, licences, franchises or any other business or commercial rights of similar nature, being intangible assets acquired on or after the 1st day of April, 1998, owned, wholly or partly, by the assessee and used for the purposes

M/S. Grasim Industries Ltd., Mumbai vs. DCIT Cir - 6(3), Mumbai

In the result, the appeal by the Revenue is dismissed

ITA 3517/MUM/2006[2005-2006]Status: DisposedITAT Mumbai04 Jul 2023AY 2005-2006

Bench: Shri Amarjit Singh & Shri Sandeep Singh Karhail

For Appellant: Shri J.D. Mistri a/wFor Respondent: Dr. Kishor Dhule

Section 142(1)Section 143(2)Section 143(3)Section 250Section 43B

Broom Publications Pvt. Ltd., Faridabad vs. ITO Ward 1(2), Faridabad

In the result, the appeal of the assessee on this ground is allowed

ITA 6177/DEL/2019[2015-16]Status: DisposedITAT Delhi27 Jun 2023AY 2015-16

Bench: Sh. Saktijit Deydr. B. R. R. Kumar

For Appellant: Sh. Rajeev Saxena, AdvFor Respondent: Sh. Kanv Bali, Sr. DR

Section 14Section 2Section 56Section 56(2)(viib)Section 68

business worth and no tangible business activity was carried out by the assessee since incorporation. Further, there were no fixed asset or any intangible asset in position of the company to justify such kind of cash flow in the future years. In the absence of any business worth ... company to the satisfaction of the Assessing Officer, based on the value, on the date of issue of shares, of its assets, including intangible assets being goodwill, know-how, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature, whichever is higher; (b) "venture capital

Balgopal Cold Storages Pvt. Ltd., Faridabad vs. ITO Ward 1(2), Faridabad

In the result, the appeal of the assessee on this ground is allowed

ITA 6176/DEL/2019[2015-16]Status: DisposedITAT Delhi27 Jun 2023AY 2015-16

Bench: Sh. Saktijit Deydr. B. R. R. Kumar

For Appellant: Sh. Rajeev Saxena, AdvFor Respondent: Sh. Kanv Bali, Sr. DR

Section 14Section 2Section 56Section 56(2)(viib)Section 68

Synergia Lifesciences Pvt Ltd, Mumbai vs. DCIT-Assessment Unit, Mumbai

In the result, the appeal by the assessee is allowed for statistical purposes

ITA 938/MUM/2023[2020-21]Status: DisposedITAT Mumbai20 Jun 2023AY 2020-21

Bench: Shri Amarjit Singh & Shri Sandeep Singh Karhail

For Appellant: Shri Rashmikant C. Modi a/wFor Respondent: Shri Anil Kumar Das

Section 115BSection 135Section 139(5)Section 142(1)Section 143(2)Section 143(3)Section 144BSection 250Section 37(1)Section 80G

repairs and insurance of plant, machinery and furniture.  Section 32 provides for depreciation on tangible assets like building, machinery, plant, furniture and also on intangible assets like know-how, patents, trademarks, licenses.  Section 33 allows development rebate on machinery, plants and ships.  Section 34 states conditions for depreciation and development

Ari Healthcare Pvt Ltd., Pune vs. DCIT, CC-2(2), Mumbai

Accordingly, the amount of Rs. 34,84,956/- is disallowed

ITA 382/MUM/2023[2017-18]Status: DisposedITAT Mumbai20 Jun 2023AY 2017-18

Bench: Shri Br Baskaran & Shri Narender Kumar Choudhry

For Appellant: Sh. Dharmesh Shah &For Respondent: Sh. Manoj Kumar Sinha, Ld. DR

Section 143(2)Section 143(3)

which was treated as capital expenditure by the AO by noticing the financial of the assessee “that out of total of intangible assets , an amount of Rs. 34,84,956/- was reduced by the assessee claiming that in AY 2016-17 such amount was capitalized and allowed depreciation thereon

The Deputy Commissioner of Income Tax, Circle-3(1), Visakhaprtnam vs. Fluentgrid Limited, Visakhapatnam

In the result, appeal of the Revenue is dismissed

ITA 62/VIZ/2021[2017-18]Status: DisposedITAT Visakhapatnam15 Jun 2023AY 2017-18

Bench: Shri Duvvuru Rl Reddy, Hon’Ble & Shri S Balakrishnan, Hon’Ble

For Appellant: Sri GVN Hari, ARFor Respondent: Sri ON Hari Prasada Rao

Section 142(1)Section 143(2)Section 143(3)Section 14A

Further, the Ld. AO noticed from the ITR and Form 3CD filed for the AY 2017-18 that there is a opening balance of intangible assets at Rs. 12,85,10,250/- whereas the ITR and Form 3CD for AY 2016-17, the closing balance of intangible assets was shown ... opening balance for the FY 2016-17 is due to change in the accounting policy whereby the expenditure of intangible assets has been re-classified as intangible as per the provisions of the IT Act, 1961. Further, the assessee also submitted that it has erroneously considered