The Commissioner Of Income Tax-2Mumbai v. M/S. Birla Global Asset Finance Co. Ltd.mumbai

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 6835 OF 2010 The Commissioner of Income Tax-2Mumbai..Appellant versus M/s. Birla Global Asset Finance Co. Ltd.Mumbai..Respondent -------- Mr. Vimal Gupta, Senior Advocate i/b Ms. Padma Diwakar for the Appellant. Mr. J.D.Mistri, Senior Advocate with Mr.Atul Jasani for the Respondent. ............. CORAM : J.P. DEVADHAR & M.S.SANKLECHA, JJ. DATE : 16[th] October, 2012 P.C. : 1 Two questions of law raised by the Revenue in this appeal read as: (A)Whether on the facts and in the circumstance of the case and in law the tribunal was right in holdingthatmotorcarsare commercial vehicles and the assessee is entitled to depreciation at the rate of 50% by ignoring the provisions of Old Appendix 1 part A item III(2) of the Income Tax Rules, 1962 relevant to the A.Y. 2004-05, which specifically provide for depreciation @ 20% on motor cars not used in the business of running them on hire?(B)Whether the Tribunal wasjustifiedinallowing depreciation on intangible assets viz. Business and commercial brand equity even though such an asset is not a depreciable asset within the meaning of section 32(1)(ii) of the Income Tax Act or Part B of the depreciation schedule in old Appendix of the IT Rules relevant to the A.Y.2004-05? 2As regard the first question is concerned, Counsel for the parties state that the said question is answered in favour of the assessee by the decision of this court in assessee's own case being Income Tax Appeal No.828 of 2010 decided on 08.08.2012. Hence, the first question cannot be entertained. 3As regard the second question is concerned, the contention of the Revenue is that intangible assets like business and commercial brand equity are goodwill on which depreciation is not allowable. The Apex court in the matter of CIT v. Smift Securities Limited, reported in (2012)24 TAXMAN 222 (SC) has held that even the intangible assets constitute goodwill on which depreciation would be allowable. Hence, the second question cannot be entertained. Accordingly, the appeal is dismissed. (M.S. SANKLECHA, J.) (J.P.DEVADHAR, J.)