TaxTMI 
TaxTMI 
2024 (5) TMI 348
X X X X Extracts X X X X
X X X X Extracts X X X X
....jecting the claim of depreciation on Water-use Rights (Intangibles Asset) for A.Y. 2017-18 has been made. 2. The facts of the case is this that during the previous year the assessee company capitalized assets of Rs. 3,58,94,000/- as intangibles. The assessee company has made a onetime payment to Gujarat Industrial Development Corporation (GDC) for use of water supply connection and drainage connection of Rs. 3,58,94,000/- and the same has been capitalized in fixed assets schedule under other (Rights) head. It is also submitted by the assessee that it paid Rs. 7,79,80,000/- to GIDC for use of water supply connection and drainage connection. Out of this amount the assessee company has recovered the amount of Rs. 3,49,00,000/- from Jubilant L....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion would also be eligible for deduction under Section 80IAB of the Act. In this respect he has relied upon CBDT circular being No.37/2016 dated 02.11.2016. 6. In fact, a judgment passed by the Coordinate Bench in ITA No.7707/Del/2017 in assessee's own case has considered this particular aspect of the matter and granted relief in favour of the assessee, copy whereof has also been submitted before us. Such fact has not been able to be converted by the Ld. DR. 7. We have heard the rival submissions made by the respective parties and perused the relevant materials available on record including the orders passed by the authorities below. On the issue involved as narrated above we further considered the judgment passed by the Coordinate Bench ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ssets schedule under Other (Rights) head, 125 Appellant claimed depreciation amounting to Rs. 67,30,125 at the rate of 25% on Rs. 2,69,20,500 being the WDV for the year under consideration. 3. Ld. Assessing Officer in the final assessment order disallowed the claim of depreciation on intangibles holdings that the facility has been put up by GDIC and assessee is using and not owning the facility and such facility is not a right. The tangible right is not depreciable in nature. The DRP had given the following directions:- a. No ownership was transferred to the assessee and only the right to use was given and therefore, the payment cannot be considered to be on account of acquisition of capital asset and therefore, no depreciation is allow....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r VI-A deduction has been claimed, result in enhancement of the profits of the eligible business, and that deduction under Chapter VI-A is admissible on the profits so enhanced by the disallowance." 5. Thus, he submitted that the deductions u/s. 80IAB should be allowed on the disallowance of depreciation as it only enhanced the profit from the impugned business. 6. On the other hand, ld. DR has strongly relied order of the Assessing Officer and DRP. 7. On the perusal of the assessment orders, we find that there is no dispute that assessee is eligible for deduction u/s. 80IAB and the disallowance of depreciation amounting to Rs. 67,30,125/-which was claimed as depreciation eligible on intangible assets u/s. 32 has lead to the enhanceme....