Global

Details

  • Service: Tax, International Corporate Tax, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 10/24/2012

India - Depreciation of intangible assets; fees for technical services 

October 24: The KPMG member firm in India has prepared reports on the following developments (read the October 2012 reports by clicking on the hyperlinks provided below):
  • “Business and commercial brand equity” is an intangible asset eligible for depreciation: The Bombay High Court held that "business and commercial brand equity” is an intangible asset that is eligible for amortization (depreciation). The tax department contended that intangible assets like “business and commercial brand equity” are goodwill on which depreciation is not allowable. The High Court, however, held that even intangible assets constitute goodwill on which depreciation is allowable.

    The case is: Birla Global Asset Finance Co. Ltd. Read an October 2012 report [PDF 181 KB]


  • Marketing, turnkey, e-publishing and quality assurance services provided by foreign company did not “make available” technical knowledge, skills, etc., and therefore, charges paid for such services cannot be treated as “fees for technical services” under the India-United States income tax treaty: The Chennai Bench of the Income-tax Appellate Tribunal held that marketing, turnkey, e-publishing, and quality assurance services provided by a foreign company did not “make available” technical knowledge, skills, etc. Therefore, charges paid for such services cannot be treated as “fees for technical services” under the India-United States income tax treaty.

    The case is: TexTech International Private Ltd. Read an October 2012 report [PDF 209 KB]


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