2014 (9) TMI 437

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....ematographic films @ 100%. The assessment order records that the assessee was required to file evidence in the form of copies of agreement entered into with the parties. The Assessing Officer observed that the assessee did not purchase any cinematographic films for consumption but what was purchased were broadcasting/exhibition rights, satellite rights etc. and, therefore, in terms of Section 32 of the Income Tax Act, 1961, depreciation should be allowed @ 25% instead of 100% depreciation as claimed. There is no other discussion in the assessment order, though the assessee had relied upon Rule 9B of the Income Tax Rules, 1962 and had stated that the rights in the feature films were sold to different parties like National Film Development Co....

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....on @ 25% of Rs. 30.00.000/- and has disallowed the balance depreciation/deduction of Rs. 90,00,000/- (Rs 1.20,00,000/- (-) Rs. 30.00,000/-) vide the order of the AO. 4.2 XXXXXX "4.3 I have considered the order of the AO and the submissions of the assessee and I find considerable merit in the submission of the assessee that in the case of purchase and sale of cinematographic films and songs etc the provisions of Rule 9B is applicable and the assessee is eligible to claim the deduction of the entire cost of purchase if the films are sold in the same year. In the present case, the assessee had made the purchase of Rs. 1,20,00,0001- and the entire films has been sold as discussed above and as such the assessee is eligible for full deducti....