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TMI Blog2009 (3) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... and R.S. MOHITE, JJ. Mr. P.S. Sahadevan and Mr. Vimal Gupta for the Appellant. Mr. F.V. Irani with Mr.A.K. Jasani for Respondents. JUDGMENT The judgment of the court was delivered by F.I. Rebello, J. - This is an appeal preferred by the Revenue wherein they have raised the following question : "Whether on the facts and in the circumstances of the case and in law, the Hon'ble Tribunal is right in allowing the assesses claim of deprecation?" 2. A few facts may be set out. The assessee is in the business of leasing. It purchased breakers from M/s. Asia Brown Broevery Ltd. and leased out the same to M/s. Tata Electric Company Limited. The assessee claimed depreciation amounting to Rs.25,25,889/-. Tata Electric Company L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Revenue is that the depreciation is given for the depletion in the value of the assets due to their use. The tribunal held that they were unable to accept the contention of the Revenue because the depreciation is not given only for the depreciation in value because of the use of the asset. The tribunal observed that the depreciation could also be given for the reduction in the usable value of assets due to wear and tear, efflux of time and obsolescence. Depreciation, it observed, can also be viewed as a method of amortising cost of asset employed in the business during the useful life of each asset. Thus the user of asset is not the only aspect which governs the allowance of depreciation. However, for the purposes of the Income Tax Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee and used for the purposes of the or profession, the following deductions shall be allowed - (i) in the case of assets of an undertaking engaged in generation or generation and distribution of power, such percentage on the actual cost thereof to the assessee as may be prescribed, (ii) in the case of any block of assets, such percentage on the written down value thereof as may be prescribed, Provided that no deduction shall be allowed under this clause in respect of - (a) any motor car manufactured outside India, where such motor car is acquired by the assessee after the 28th day of February, 1975 (but before the 1st day of April, 2001), unless it is used - (i) in a business of running it on hire for tourists; or (ii ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olly used for the purposes of the business carried on by the assessee, and (iii) the machinery must come under any of the categories specified in sub section (2) of section 32A. The court then proceeded to observe that the requirement therefore, is that the machinery must be wholly used for the purpose of such assessee's business and when the business of the assessee is leasing of such machines, the machines so leased out are being used for the purpose of the assessee's business. The court further observed that section does not require that the assessee itself should use the machinery for the purpose. On the comparison of the language used in Section 32A and 32, the same is in para materia, Ordinarily considering that the words appear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f business. A Special Leave Petition filed was dismissed. Looking at the observations in the judgment what will be apparent is that the court understood the expression "used" to mean used for the purpose of the business however, made distinction with respect to the vehicle which was ready for use. 10. In an unreported judgment of the Supreme Court in MCorp Global Pvt. Ltd. Versus Commissioner of Income Tax, Ghaziabad, being Civil Appeal No. 955 of 2009 decided on 12.2.2009, the appellant before the Supreme Court was claiming claim for depreciation in respect of bottles, which were received after the financial year i.e. 31.3.1991 i.e. between 3.4.1991 and 18.4.1991, though the bottles were paid for and dispatched before 31.3.1991. The A. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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