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Showing contexts for: computer includes computer software in Nagarjuna Agrichem Ltd., Hyd, ... vs Assessee on 8 October, 2013Matching Fragments
16. The learned DR on the other hand pointed out that from AY 2003- 04 as per Rule-5 of IT Rules read with old appendix-1 indicates that the items falling under the category of computers including computer software are eligible for depreciation of 60% and hence the AO has rightly treated it as capital expenditure and allowed depreciation at 60%.
17. After hearing the parties and perusing the record, we are of the opinion that as it is one time expenditure and grant of licence is tied up to the payment made by the user, the same shall be allowed as revenue expenditure. Ld CIT(A) has rightly came to a conclusion that expenditure is revenue in nature but that of deferred revenue. W e do not agree with the later conclusion. The expenditure is revenue in nature and AO has rightly considered as such at the time of original assessment Accordingly, we modify the order of the CIT(A) and allow this ground of appeal of the assessee. AO is directed to allow entire expenditure as claimed.