In  29 ITR (Trib)-OL 602 (ITAT[Chen]) the assessee company is held eligible for claim of depreciation on brand value acquired from the partnership firm in lieu of allotment of fully paid equity shares to the partners of the erstwhile partnership firm who now assumed the role of directors of the company. This is a case of conversion of firm into a company. The erstwhile firm carried on manufacturing business for more than six decades under a registered
brand name. The firm valued the brand before undertaking the transfer as per valuation report of chartered accountants.
In allowing depreciation on brand value the bench held that the firm valued the registered brand name for its brand value of Rs. 60,24,10,642 by an independent and scientific method of valuation as per internationally expected standards using the double discount rate of
the market, at 28 per cent. + 10 per cent. margin of errors and transferred the same to the assessee-company, i. e., the transferee
by satisfying all the conditions prescribed under the Act, i. e., 47(xiii) of the Act. According to us, now this value is found to be reasonable in
regard to brand value and the assessee is eligible for claim of depreciation acquired from the partnership firm in lieu of allotment of fully paid equity
shares to the partners of the partnership firm. As to the application of the provisions of section 55(2)(a) of the
Act, for determining the nil value of the brand, the bench found the same as inapplicable as the firm got the valuation made in its books before executing transfer.