1

Commissioner (A) is not empowered to enhance income a new source of income vide 82ITR 9Trib) 176
1

It is assessee’s choice to select a method for determining FMV of shares vide 81 ITR (Trib) (SN) 78
1

No TP adjustment of trade receivables in case of a debt-free company vide 81ITR (Trib) (SN) 94
1

To accord registration as a charitable institution under income tax dominant purpose must be charitable and satisfies the conditions laid down us 2(15) vide 426ITR108 despite having non charitable ancillary objects meant to achieve the dominant purpose
1

Transactions with dubious entities is reason enough for case reopening vide 421ITR624

Software expenditure, whether revenue or capital

ByCA Gopal Nathani

Nov 10, 2022

Bengaluru is considered as the Silicon Valley of India which consumes bulk of the software purchases. The Karnataka high court has taken a uniform stand that software is revenue expenditure. In [2022] 448 ITR 94 (Kar) the Court held that software is an aid in manufacturing process rather than a tool itself. It merely enhances the productivity or the efficiency and therefore, it has to be treated as a revenue expenditure.

It may be wise for the CBDT to amend the income tax rules to remove indigenous developed softwares from the list of depreciable assets to reduce unwanted litigation.