Depreciation on Goodwill Allowed Under Section 32(1)(ii); Product Registration Expenses Deductible Under Section 37(1)

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Full Text of the Document

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....The ITAT upheld the allowability of depreciation on goodwill arising from a court-sanctioned amalgamation under section 32(1)(ii), rejecting the AO's disallowance and reliance on AS-26 and precedent. The tribunal affirmed that once depreciation is allowed, the carry-forward of unabsorbed depreciation is a vested right and cannot be denied without reversal by a competent forum, thereby dismissing the AO's disallowance of brought-forward depreciation. Product registration expenses were held to be revenue in nature and deductible under section 37(1), not capital expenditure. The claim for deduction under section 80-IC was sustained, as the Baddi Unit was found to have operational autonomy and no nexus was established to allocate corporate expe.........