Assessee is entitled to claim of depreciation on road to collect toll being an intangible asset falling within purview of section 32(1)(ii).

Depreciation

Rate of depreciation

Assessee company was taken up for scrutiny assessment

Claim of assessee regarding depreciation @ 25% and provision for maintenance of Road was disallowed

However, Assessing Officer allowed depreciation @ 10% instead 25% as claimed by assessee

CIT(A) sustained both disallowances

ITAT held as under:

Issue under dispute is with regard to availability of depreciation to assessee whether it is to be allowed keeping right to collect toll fee as intangible assets or it to be treated as building or plant & machinery

 There were conflicting decisions rendered by High Court and Co-ordinate Benches of Tribunal

However, the Tribunal in the case of ACIT vs M/s. West Gujarat Expressway Ltd. in ITA Nos. 5904 & 6244/M/2012 after considering conflicting views held that Assessee is entitled to collect tax being an intangible commercial right under section 32(1)(ii) at rate as has been prescribed under relevant rules

 Claim of assessee for treating ‘License to collect Toll’ as an intangible asset eligible for claim of depreciation @ 25% as per Section 32(1)(ii) was justified—Assessee is entitled to claim of depreciation on road to collect toll being an intangible asset falling within purview of section 32(1) (ii)

 Respectfully following view expressed by Bombay High Court and Special Bench of this Tribunal, assessee is eligible for depreciation @ 25% as claimed by assessee

 Assessee’s ground allowed.