Intangible asset
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
15 November 2014
Is admission fees paid by an individual to MCX for membership an intangible asset or not?
Reply with reasons & case laws, please.
Reply with reasons & case laws, please.
15 November 2014
The aspect which one needs to consider, is whether the membership right or the trading right is transferable or not. If it is transferable, it would support the view that such a right is a capital asset, but if not, then the view that the cost of acquiring the right is a revenue expenditure would be justifiable.
One also however needs to keep in mind that when it comes to the claim of depreciation in respect of a stock exchange membership card, the depreciation would be allowable only if the stock exchange membership card or trading right were to be a capital asset [Refer Techno Shares & Stocks Ltd. v. ITO, 101 TTJ (Mum.) 349, Kaynet Capital Ltd. v. Dy. CIT, 39C BCAJ 275 (Mum.) (Dec. 2006)
One also however needs to keep in mind that when it comes to the claim of depreciation in respect of a stock exchange membership card, the depreciation would be allowable only if the stock exchange membership card or trading right were to be a capital asset [Refer Techno Shares & Stocks Ltd. v. ITO, 101 TTJ (Mum.) 349, Kaynet Capital Ltd. v. Dy. CIT, 39C BCAJ 275 (Mum.) (Dec. 2006)
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