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Issues Involved:
1. Validity of the Parthas Trust 2. Deduction in the computation of income related to depreciation on immovable properties Summary: 1. Validity of the Parthas Trust: The court examined the validity of the Parthas Trust constituted by an indenture dated August 4, 1971. The Income-tax Officer initially rejected the trust's validity due to the lack of a duly executed instrument in writing u/s 160(1)(iv) of the Income-tax Act, 1961. The Appellate Assistant Commissioner and the Tribunal, however, affirmed the trust's validity. The High Court upheld the Tribunal's findings, noting that the founder had the necessary funds to constitute the trust and that contributions came from major members, not minors. The court concluded that the trust was valid and created by a duly executed instrument in writing, answering the question in the affirmative, in favor of the assessee and against the Revenue. 2. Deduction in the Computation of Income Related to Depreciation on Immovable Properties: The court considered whether the trust could claim depreciation on immovable properties obtained under an agreement dated August 17, 1971. The court emphasized that u/s 32 of the Income-tax Act, depreciation is claimable only by an owner of the asset who uses it for business purposes. The court highlighted the necessity of legal ownership and use of the asset, rejecting the claim for depreciation as the trust did not have a registered sale deed, thus failing to meet the ownership requirement. The court aligned with the majority view of other High Courts and disagreed with the contrary views of the Allahabad and Patna High Courts, ultimately denying the deduction for depreciation. Conclusion: The court confirmed the validity of the Parthas Trust and denied the claim for depreciation on immovable properties, answering the issues in favor of the assessee regarding the trust's validity and against the assessee on the depreciation claim.
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