Poor i-Pad failed to pass the test of “Computer”

 

 

Recently, there was an issue before ITAT Amritsar as to whether the Ipad is computer eligible for a higher depreciation rate of 60%, or it would fall under the general category of plant & machinery which is eligible for depreciation at the rate of 15 % depreciation only.

It may be recalled that Delhi High Court has held UPS, Scanners, Printers, Routers as computers for depreciation.

The Mumbai ITAT has held Smart phones and Tabs as computers for depreciation.

Even ATMs have been held to be the computer by Karnataka HC for claiming the depreciation.

However, Poor iPad failed in establishing itself as the computer.

The Amritsar Bench of ITAT concluded that the iPad is not a computer but a communication device and hence eligible for the general depreciation rate applicable to plant & machinery, i.e. 15%.

With regards to the Hon’ble ITAT, in an era where mobiles  are often used as a computer only and the distinction between a tablet and a computer is largely indistinguishable.

Holding mobiles as a mere communication device may not be fully proper. The observation is purely based on the traditional notion of what a computer is. However, in the present era, computers may cover a wide range of devices in the present context. Even the normal life of a mobile phone is also of around 2 years as the changing technology requires the change in the mobile phone and it must be treated as “Computer” in view of the changing requirements.

Hope suitable amendment may be carried out by the legislation and not judiciary in the interest of the taxpayers.

The copy of the complete order is as under:

Poor i-Pad failed to pass the test of “Computer”