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“depreciation on software”

DepreciationSection 32Section 32120 judgments

The decision most relied on for depreciation on software is Techno Shares and Stocks Ltd. v. CIT (327 ITR 323), cited in 130 judgments on BharatTax.

Leading authorities on depreciation on software

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%.

CIT v. IBM India Ltd.
357 ITR 88 · 2013 · High Court
88
citing judgments

Expenditure on application software, which enhances business efficiency and requires a computer system to function, constitutes revenue expenditure rather than acquisition of a capital asset, even if it provides an enduring benefit.

Hindustan Unilever Ltd. v. DCIT
325 ITR 102 · 2010 · High Court
62
citing judgments

The deduction under Section 10A/10B is a deduction, not an exemption, and must be given effect to at the stage of computing the profits and gains of business. For this purpose, commercial profits mean profits without adjustment of depreciation as per the Income Tax Act.

Kerala Vision Ltd. v. ACIT (
35 Taxmann.com 463 · 2013 · ITAT
52
citing judgments

Transactions carried out on the purchase of off-the-shelf software prior to the jurisdictional High Court's decision in CIT v. Samsung Electronics Co. Ltd. (October 15, 2011) are not liable for Tax Deducted at Source (TDS).

Thiru Arooran Sugar Ltd. v. DCIT
350 ITR 324 · 2013 · High Court
44
citing judgments

A deduction for interest expense on borrowed funds used for interest-free advances to group companies is permissible only if the assessee establishes these advances were from surplus funds. The decision further clarifies eligibility for depreciation on intangible assets like non-compete fees, software, goodwill, and commercial rights under section 32(1)(ii), often arising from a slump sale.

SKOL Breweries Ltd. v. ACIT
29 Taxmann.com 111 · 2013 · ITAT
33
citing judgments

Section 40(a)(i)/(ia) of the Income Tax Act, 1961, pertains to outgoing revenue expenditure and does not apply to capital expenditure, meaning depreciation cannot be disallowed under these provisions for capital expenses, such as software purchases.

CIT v. Computer Age Management Services (P.) Ltd.
109 Taxmann.com 134 · 2019 · High Court
27
citing judgments

Software integrated with a computer system is eligible for the same rate of depreciation as the computer system itself.

Judgments citing depreciation on software

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

ITA 294/BANG/2025[2021-22]Status: DisposedITAT Bangalore30 Jan 2026AY 2021-22

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

identical issue has been decided by tribunal in the case of holding company of the assessee and other group companies where rate of depreciation on software license has been allowed at 60%. Hence, the learned CIT(A) directed the AO to allow depreciation at 60% if any of software license

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

In the result, both the appeals of the assessee are partly allowed for statistical purposes

ITA 293/BANG/2025[2020-21]Status: DisposedITAT Bangalore30 Jan 2026AY 2020-21

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

identical issue has been decided by tribunal in the case of holding company of the assessee and other group companies where rate of depreciation on software license has been allowed at 60%. Hence, the learned CIT(A) directed the AO to allow depreciation at 60% if any of software license

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

In the result, both the appeals of the assessee are partly allowed for statistical purposes

ITA 292/BANG/2025[2019-20]Status: DisposedITAT Bangalore30 Jan 2026AY 2019-20

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

identical issue has been decided by tribunal in the case of holding company of the assessee and other group companies where rate of depreciation on software license has been allowed at 60%. Hence, the learned CIT(A) directed the AO to allow depreciation at 60% if any of software license

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

ITA 291/BANG/2025[2018-19]Status: DisposedITAT Bangalore30 Jan 2026AY 2018-19

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

identical issue has been decided by tribunal in the case of holding company of the assessee and other group companies where rate of depreciation on software license has been allowed at 60%. Hence, the learned CIT(A) directed the AO to allow depreciation at 60% if any of software license

Edgeverve Systems Limited, Bangalore vs. ACIT, Circle-2(2)(1), Bangalore

In the result, both the appeals of the assessee are partly allowed for statistical purposes

ITA 290/BANG/2025[2017-18]Status: DisposedITAT Bangalore30 Jan 2026AY 2017-18

Bench: Shri Waseem Ahmed & Shri Soundararajan K

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Shri Shivanad Kalakeri, CIT (DR)
Section 250Section 254Section 37Section 90

identical issue has been decided by tribunal in the case of holding company of the assessee and other group companies where rate of depreciation on software license has been allowed at 60%. Hence, the learned CIT(A) directed the AO to allow depreciation at 60% if any of software license

Deputy Commissioner of Income Tax Circle 2 1 1 Ahmedabad, Ahmedabad vs. Khyati Chemicals Private Limited, Ahmedabad

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

ITA 1856/AHD/2025[2018-19]Status: DisposedITAT Ahmedabad16 Jan 2026AY 2018-19

Bench: DR. BRR Kumar (Vice President), Shri T. R. Senthil Kumar (Judicial Member)

Section 143(3)Section 198Section 37(1)Section 40ASection 40A(2)(b)

definition of the assets under head "Computer" have been amended and now it stated as "Computer including "computer software". Therefore, appellant can claim depreciation on software license @ 60%. I am satisfied with the I.T.A No. 1856/Ahd/2025 & C.O.86/Ahd/25 A.Y. 2018-19 5 DCIT Vs. Khyati Chemicals Pvt. Ltd. addition made

Thermo Fisher Scientific India P. Ltd, Mumbai vs. DCIT 15(3)(1), Mumbai

ITA 7294/MUM/2018[2014-15]Status: DisposedITAT Mumbai02 Jan 2026AY 2014-15

Bench: Shri Vikram Singh Yadavshri Sandeep Singh Karhail

For Appellant: Shri Dhanesh Bafna, Shri Anmol MahajanFor Respondent: Shri Pravin Salunkhe, Sr.DR
Section 143(3)Section 144C(13)Section 144C(5)Section 32(1)

which is an intangible asset eligible for deprecation under section 32(1) r.w.s 2(11) of the IT Act. 4. Ground 4 - Consequential depreciation on software expenses capitalised in AY 2007-08 On the facts and in the circumstances of the case and in law, the learned DCIT has erred ... case and in law, the learned DCIT and Hon'ble DRP erred in not allowing depreciation of Rs. 104,938 relating to depreciation on software expenses treated as capital expenditure in AY 2007-08. 7. Ground 7 - Allowance of brought forward unabsorbed depreciation pertaining

Thermo Fisher Scientific India P. Ltd, Mumbai vs. DCIT 15(3)(1), Mumbai

In the result, the appeal by the assessee for the assessment year 2014-

ITA 7393/MUM/2017[2013-14]Status: DisposedITAT Mumbai02 Jan 2026AY 2013-14

Bench: Shri Vikram Singh Yadavshri Sandeep Singh Karhail

For Appellant: Shri Dhanesh Bafna, Shri Anmol MahajanFor Respondent: Shri Pravin Salunkhe, Sr.DR
Section 143(3)Section 144C(13)Section 32(1)

which is an intangible asset eligible for deprecation under section 32(1) r.w.s 2(11) of the IT Act. 4. Ground 4 - Consequential depreciation on software expenses capitalised in AY 2007-08 On the facts and in the circumstances of the case and in law, the learned DCIT has erred ... case and in law, the learned DCIT and Hon'ble DRP erred in not allowing depreciation of Rs. 262,345 relating to depreciation on software expenses treated as capital expenditure in AY 2007-08. 6. Ground 6 - Allowance of brought forward unabsorbed depreciation pertaining

Thermo Fisher Scientific India P. Ltd, Mumbai vs. DCIT 15(3)(1), Mumbai

ITA 577/MUM/2017[2012-13]Status: DisposedITAT Mumbai02 Jan 2026AY 2012-13

Bench: Shri Vikram Singh Yadavshri Sandeep Singh Karhail

For Appellant: Shri Dhanesh Bafna, Shri Anmol MahajanFor Respondent: Shri Pravin Salunkhe, Sr.DR
Section 143(3)Section 144C(13)Section 144C(5)Section 32(1)

which is an intangible asset eligible for deprecation under section 32(1) r.w.s 2(11) of the IT Act. 4. Ground 4 - Consequential depreciation on software expenses capitalised in AY 2007-08 On the facts and in the circumstances of the case and in law, the learned DCIT has erred ... case and in law, the learned DCIT and Hon'ble DRP erred in not allowing depreciation of Rs. 104,938 relating to depreciation on software expenses treated as capital expenditure in AY 2007-08. 7. Ground 7 - Allowance of brought forward unabsorbed depreciation pertaining

Thermo Fisher Scienftific India P. Ltd, Mumbai vs. DCIT 15(3)(1), Mumbai

In the result, the appeal by the assessee for the assessment year 2014-

ITA 1236/MUM/2016[2011-12]Status: DisposedITAT Mumbai02 Jan 2026AY 2011-12

Bench: Shri Vikram Singh Yadavshri Sandeep Singh Karhail

For Appellant: Shri Dhanesh Bafna, Shri Anmol MahajanFor Respondent: Shri Pravin Salunkhe, Sr.DR
Section 143(3)Section 144C(13)Section 32(1)

which is an intangible asset eligible for deprecation under section 32(1) r.w.s 2(11) of the IT Act. 4. Ground 4 - Consequential depreciation on software expenses capitalised in AY 2007-08 On the facts and in the circumstances of the case and in law, the learned DCIT has erred ... case and in law, the learned DCIT and Hon'ble DRP erred in not allowing depreciation of Rs. 262,345 relating to depreciation on software expenses treated as capital expenditure in AY 2007-08. 6. Ground 6 - Allowance of brought forward unabsorbed depreciation pertaining

DCIT, Bangalore vs. M/S Thomson Reuters India Services Pvt. Ltd., Bangalore

In the result, appeal filed by revenue in IT(TP)

ITA 843/BANG/2015[2010-11]Status: DisposedITAT Mumbai31 Dec 2025AY 2010-11

Bench: Smt. Beena Pillai () & Shri Girish Agrawal ()

Section 10ASection 10A(2)Section 143(3)

assessment proceedings. 10. a) That on the facts and circumstances of the case, the learned AO erred in denying the claim for depreciation on software purchases on account of non-deduction of tax at source under section 40(a)(i) / 40(a)(ia) of the Act. b) That the learned ... Denying claim of depreciation on goodwill in respect of the undertaking acquired by slum sale amounting to Rs.9,01,44,504/- • Disallowance of depreciation of software items u/s 40(a)(ia) amounting to Rs. 82,25,200/-. 4.1. The Ld. AO, thus, passed draft assessment order incorporating the proposed

M/S Thomson Reuters International Services Private Limited, Mumbai vs. DCIT, Bangalore

ITA 542/BANG/2015[2010-11]Status: DisposedITAT Mumbai31 Dec 2025AY 2010-11

Bench: Smt. Beena Pillai () & Shri Girish Agrawal ()

Section 10ASection 10A(2)Section 143(3)

assessment proceedings. 10. a) That on the facts and circumstances of the case, the learned AO erred in denying the claim for depreciation on software purchases on account of non-deduction of tax at source under section 40(a)(i) / 40(a)(ia) of the Act. b) That the learned

DCIT, Bangalore vs. M/S Thomson Corporation (International) Pvt. Ltd., Bangalore

ITA 234/BANG/2015[2010-11]Status: DisposedITAT Mumbai31 Dec 2025AY 2010-11

Bench: Smt. Beena Pillai () & Shri Girish Agrawal ()

Section 10ASection 10A(2)Section 143(3)Section 7A

assessment proceedings. 10. a) That on the facts and circumstances of the case, the learned AO erred in denying the claim for depreciation on software purchases on account of non-deduction of tax at source under section 40(a)(i) / 40(a)(ia) of the Act. b) That the learned

Cnb Finwiz Private Limited, Delhi vs. ACIT, Circle-6(1), Delhi

In the result, the appeal of the assessee is allowed

ITA 4460/DEL/2025[2017-18]Status: DisposedITAT Delhi16 Dec 2025AY 2017-18

Bench: Shrimahavir Singh, Hon’Ble & Shrisanjay Awasthiआ.अ.सं/.I.T.A No.4460/Del/2025 िनधा"रणवष"/Assessment Year: 2017-18 बनाम M/S Cnb Finwiz Private Limited, Additional/Joint 302-303, Emca House 23/23B, Vs. Commissioner Of Income Ansari Road, Daryaganj, New Delhi. Tax (Appeal)-1/ Pan No.Aabcb2613A Acit, Circle 6(1), Delhi. अपीलाथ" Appellant ""यथ"/Respondent

Section 250

relied upon decision of ITAT Delhi in the case of M/s Amway India Enterprises (supra) in which ITAT has allowed depreciation on software @60%. Respectfully following the decision of ITAT Delhi. it is held that depreciation @60% is allowable in the case of software. In view of this the appeal

Assistant Commissioner of Income Tax Central Circle 6 4 Mumbai, Mumbai vs. Indiabulls Real Estate Limited, New Delhi

Appeal is dismissed

ITA 3108/DEL/2024[2013-14]Status: DisposedITAT Delhi14 Nov 2025AY 2013-14

Bench: Sh. Satbeer Singh Godara & Sh. Manish Agarwal

For Appellant: Sh. Ankit Kumar, AdvFor Respondent: Sh. Om Prakash, Sr. DR
Section 143(3)Section 14ASection 14A(2)

erred in deleting the addition of Rs.43,01,604/- made by the AO on account of disallowance of excess claim of depreciation on software expenses? 3. On the facts and circumstances of the case and in law, the ld. CIT(A) has erred in allowing the additional claim

Ani Technologies Private Limited, Bengaluru vs. Principal Commissioner of Income-Tax- 1, Bengaluru

In the result, the appeal of the assessee is allowed

ITA 1124/BANG/2025[2020-21]Status: DisposedITAT Bangalore03 Nov 2025AY 2020-21

Bench: Shri Waseem Ahmed & Shri Soundararajan K

Section 143(3)Section 263

PCIT may hold the enquiry to be inadequate, but inadequate enquiry does not empower revision. 11. Even assuming, the AO erred in allowing depreciation on software expenditure in AY 2020-21, the crucial question is whether such error is prejudicial to the interests of the Revenue. We find that

Assistant Commissioner of Income Tax-16(1), Mumbai vs. Viacom18 Media Private Limited, Mumbai

ITA 5658/MUM/2024[2013-14]Status: DisposedITAT Mumbai15 Oct 2025AY 2013-14

Bench: Shri Narender Kumar Choudhry & Ms. Padmavathy S

For Respondent: Shri Nimesh Vora, Ld. Adv
Section 115JSection 143(1)Section 143(2)Section 143(3)Section 250

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI "F" BENCH :: MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER & Ms. PADMAVATHY S

M/S.Cool Minds Technologies P. Ltd, Cochin vs. The ACIT, Cochin

The appeals are dismissed

ITA 375/COCH/2016[2007-08]Status: DisposedITAT Cochin22 Aug 2025AY 2007-08

Bench: CIT(A) the it was claimed by the Assessee that deduction under Section 10B of the Act was initially claimed by the Assessee under the bona fide belief that it is entitled to deduction under Section 10B of the Act. The CITT(A) dismissed the appeal of the Assessee agreeing with the Assessing Officer and holding that the Assessing Officer was justified in not considering the claim made by the Assessee under Section 10A of the Act. Now the Assessee is in

For Appellant: Shri Abraham Joseph Markos, AdvFor Respondent: Smt. Leena Lal, Sr. DR
Section 10ASection 10BSection 143(3)Section 147Section 148Section 250Section 263

reasonable opportunity of being heard to the assessee before completing the proceedings. 6. Ground Nos. (iv) and (v) relate to the claim of depreciation on software developed by Directors and software purchased from Oasis Infotech Limited which are allowed by the CIT (A). 7. At the outset, the learned

Thermo Fisher Scientific India P. Ltd, Mumbai vs. DCIT 15(3)(1), Mumbai

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

ITA 2458/MUM/2015[2010-11]Status: DisposedITAT Mumbai16 Jul 2025AY 2010-11

Bench: Shri Vikram Singh Yadavshri Sandeep Singh Karhail

For Appellant: Shri Dhanesh Bafna, Shri Amol MahajanFor Respondent: Shri Ajay Chandra, CIT-DR
Section 143(3)Section 144CSection 144C(5)Section 32(1)

case and in law, the learned DCIT and Hon'ble DRP erred in not allowing depreciation of Rs.262,345 relating to depreciation on software expenses treated as capital expenditure in AY 2007-08. 8. Ground 8 - Allowance of brought forward unabsorbed depreciation pertaining to AY 2009-10 ITA No.2458/Mum/2015 ... case and in law, the learned DCIT and Hon'ble DRP erred in not allowing depreciation of Rs.104,938 relating to depreciation on software expenses treated as capital expenditure in AY 2007-08. 9. Ground 9 - Transfer pricing (`TP') adjustment of Rs.19,18,64,661 relating to alleged excessive advertisement

ACIT, Circle- 1, Ltu, New Delhi vs. C&S Electric Ltd., New Delhi

In the result, the revenue’s appeal stands dismissed as above

ITA 8274/DEL/2018[2015-16]Status: DisposedITAT Delhi30 Jun 2025AY 2015-16

Bench: Shri Yogesh Kumar U.S. & Shri Avdhesh Kumar Mishraita No. 2622/Del/2018, A.Y. 2013-14 Ita No. 2623/Del/2018, A.Y. 2014-15 Ita No. 7981/Del/2018, A.Y. 2015-16 C & S Electric Limited Deputy Commissioner Of 222, Okhla Industrial Estate Income Tax, Phase-Iii, New Delhi Vs. Circle-1, Ltu, New Delhi Pan: Aaacc0909K (Appellant) (Respondent) Ita No. 2532/Del/2018, A.Y.2013-14 Ita No. 2533/Del/2018, A.Y.2014-15 Ita No. 8274/Del/2018, A.Y.2015-16 Deputy Commissioner Of C & S Electric Limited Income Tax, (Formerly Controls & Circle-1, Ltu, Vs. Switchgear Co. Ltd.) New Delhi 222, Okhla Industrial Estate, Phase-Iii, New Delhi Pan: Aaacc0909K (Appellant) (Respondent) Appellant By Sh. Anil Bhalla, Ca Respondent By Sh. Rajesh Kumar Dhanesta, Sr. Dr Date Of Hearing 05/06/2025 Date Of Pronouncement 30/06/2025 Order Per Bench Cross Appeal By The Assessee & Revenue Containing Common Facts Were Heard Together Being Inter-Connected With Each Other & Are Being Disposed Off By This Common Order. Ita No.2532, 2533 & 8274/Del/2018 C & S Electric Ltd. 2. These Appeals Filed By The Assessee & Revenue Are Directed Against Orders Dated 10.01.18 & 25.09.2018 Respectively Of The Commissioner Of Income Tax (Appeals)-22, New Delhi [‘Cit(A)’].

Section 10ASection 14ASection 80Section 80I

Disallowance under section 14A of the Act. iv. Disallowance of foreign travelling expenses. v. Disallowance of Club expenses. vi. Disallowance of depreciation on software license. 3. The relevant facts giving rise to these appeals of AY 2013-14 are that the assessee, manufacturer of electrical equipments; such as, switches, sockets ... 80IC of the Act. ii. Deduction under section 10AA of the Act. iii. Disallowance under section 14A of the Act. iv. Disallowance of depreciation on software license. 22. The Ld. AR submitted that the issue relating to claim of deduction under section 80IC and 10AA of the Act, the grounds