2019 (2) TMI 368 - AT - Income Tax

Depreciation on the asset Right to Collect Toll - Held that - CIT(A) allowed the benefit of depreciation @25% on the intangible asset designated by the assessee as Right to Collect Toll by relying on certain Tribunal orders passed in the case of assessee s sister concern. It is further observed that similar view has been taken by the Special Bench of the Tribunal in ACIT Vs. Progressive Construction Limited 2017 (3) TMI 1167 - ITAT HYDERABAD . DR, except for relying on the order of the AO, could not place any material on record to demonstrate that the order passed by the Tribunal in the case of the assessee s sister concern has been reversed or modified by the Hon ble Bombay High Court in any manner. Respectfully following the precedent, we uphold the impugned orders. In the result, both the appeals are dismissed.

Summary

Issues:
Granting of depreciation on the asset 'Right to Collect Toll'.

Analysis:
The appeals by the Revenue were against granting depreciation on the asset 'Right to Collect Toll' for two separate orders concerning different assesses for the assessment year 2013-14. The common issue was addressed in a consolidated order. The assessee, M/s. Ashoka Highways (Durg) Limited, claimed depreciation on the intangible asset 'License to Collect Toll'. The Assessing Officer disallowed the depreciation, citing a Tribunal order pending before the Hon'ble Bombay High Court. The ld. CIT(A) allowed the depreciation based on Tribunal orders related to the assessee's sister concern. A similar case involving M/s. Ashoka Highways (Bhandara) Limited had a comparable outcome, where the claim of depreciation was denied by the AO but allowed by the ld. CIT(A).

The Tribunal noted that the ld. CIT(A) had granted depreciation on the asset 'Right to Collect Toll' by relying on Tribunal orders related to the assessee's sister concern. It was also highlighted that a Special Bench of the Tribunal had taken a similar view in a different case. The ld. DR failed to provide evidence that the Tribunal's decision in the sister concern's case had been overturned or modified by the Hon'ble Bombay High Court. Consequently, the Tribunal upheld the impugned orders, resulting in the dismissal of both appeals. The decision was pronounced in the Open Court on 5th February 2019.