TaxTMI 
TaxTMI 
2007 (9) TMI 437
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....s follows :- "The learned CIT(A) XI erred in confirming that the Appellant was not entitled to depreciation of Rs. 14,03,100 in respect of premium paid for acquiring office premises amounting to Rs. 1,40,31,000." 3. The assessee had acquired office premises during the previous year under appeal, at Barodawala Mansion, Worli. The premises were acquired as tenants. As part of the deal, the assessee had paid the amount of Rs. 1,40,31,000 for acquiring the premises on perpetual lease. The amount was paid by the assessee to the outgoing tenants for vacating the premises earlier held by them. The owners of the property are not liable to return the said amount or any part thereof to the assessee on vacating the premises. In fact, premium was pai....
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....rpose of business/profession carried on by the assessee. It is a transferable right. So the payment made by the assessee partakes the character of a transferable right in the form of licence which is classified under intangible assets for the purpose of depreciation allowance. 7. The learned counsel also argued that the term 'owned' as occurring in section 32 must be assigned a meaning to cover any one in possession of the property in his own exercising such domicile over the property as would enable others being excluded therefrom. The concept of depreciation suggests that tax benefit legitimately belongs to one who invested in the capital asset and utilized the asset thereby losing the investment by wear and tear. He also submitted that ....
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.... of the expressions following thereafter that "any other business or commercial rights of similar nature". It means know-how, patents, copyrights, trademarks, licence, franchises etc. need to be similar in nature pertaining to business or commercial rights. It follows that all the above expressions are placed at a same level with similar nature and relating to business or commercial rights. In that sense, the expression "licence" cannot be singled out from business or commercial nature of rights and held as a right referable to tenancy of immovable property. If one applies the principle of "ejusdem generis", the term "licences" has to be read in the company of the preceding terms like know-how, patents, copyrights and trademarks and also th....
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....32. 12. The first ground is, therefore, decided against the assessee. 13. The second ground raised by the assessee reads as below :- "The learned CIT(A) erred in confirming that out of the total expenditure of Rs. 20,58,374 a sum of Rs. 15,44,079 incurred by the appellants on repairs and maintenance was required to be considered as capital expenditure and not revenue expenditure." 14. We have gone through the details of expenses incurred by the assessee in repairing and maintaining the premises acquired on lease. In fact, those expenses were incurred by the assessee to make the premises suitable for accommodating the office and functioning of the assessee. Those expenses could not be held as capital expenditure. The expenses were incurr....