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3. Depreciation on computer software to be * Depreciation schedule *In Point No.9 of the restricted to 25 percent as against 60 as per Form No.3CD notice under Section https://www.mhc.tn.gov.in/judis/ S.No. Reason Provided Materials/evidence Manner in which the relied on as evident issue was dealt with from the letter dated 28th during the assessment August, 2015 proceedings under Section 143(3) of the Act percent claimed by the Assessee. (Schedule II) wherein the 142(1) dated 15 January (Point 4 of the letter dated 28 August Assessee has claimed 2014 the Assessee was 2015). depreciation at the rate of asked to furnish details 60 per cent on Computer of assets in the nature of software. 'UPS-Battery' included under the block 'Computers'.

8. The question would be as to whether the software application, which was acquired by the assessee would fall under Entry 5 of Part A of New Appendix I, which states that computers including computer software are entitled to depreciation at 60%. Note 7 of the Appendix defines the expression 'computer software' to mean any programs recorded https://www.mhc.tn.gov.in/judis/ on CD or disc, tape, perforated media or other information storage devices.

According to Entry III(5) of Part A of the New Appendix I to the Income Tax Rules, computer including computer software are eligible for depreciation at the rate of 60% of the written down value. In the note below the table, 'computer software' has been explained to mean any computer program recorded on any disc, tape, perforated media or other information storage device. In the case of the Assessee, verification of the details of software purchases revealed that the additions to the software description represented only software licenses acquired by the company. In the books of accounts maintained, for the purpose of depreciation, the Assessee has classified the software purchased as 'intangible asses'.