INCOME TAX ACT, 1961

Section 32(1)(ii)

Depreciation - Allowability - Network rights -

Assessee-comapny was engaged in Cable TV business. It claimed depreciation on network rights, which was disallowed by AO alleging that the network rights were not intangible assets and therefore, depreciation would not be allowable on it. He treated the network rights as 'goodwill' and alleged that no depreciation would be allowable on goodwill and accordingly, he disallowed the claim of depreciation and brought it to tax. Held: In view of Supreme Court decision in the case of CIT v. Smifs Securities Ltd. (2012) 348 ITR 302 (SC): 2012 TaxPub(DT) 2430 (SC), depreciation is allowable on 'goodwill'. Therefore, the AO was directed to allow depreciation on 'network rights'.

Followed:CIT v. Smifs Securities Ltd. (2012) 348 ITR 302 (SC) : 2012 TaxPub(DT) 2430 (SC)

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2010-11

INCOME TAX ACT, 1961

Section 37(1)

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