Indian Kanoon - Search engine for Indian Law

Disallowance of the claim of depreciation on additions to computer software : Rs.17,63,425/-

14. The A.O during the course of the assessment proceedings observed that the assessee had during the year incurred software expenses on upgradation of its existing software viz. MFGPRO, MS Office etc. It was noticed by him that the assessee had claimed depreciation on the capitalized value of the software expenses @ 60%. The A.O was of the view that as per Rule 5 of the I-T Rules, 1962 only "computers including software" were eligible for depreciation @ 60%. In other words, the A.O held a conviction that in a case where the computers were purchased along with the computer software, then such software would form part of the "computer including software"