Depreciation on leased business assets remains available when ownership continues and the letting is part of taxable business income.

Depreciation was held allowable on a jute press let out on rent because the asset remained the assessee's property and was commercially exploited as part of the business from which income was assessed. The allowance under Section 10(2)(vi) of the Income-tax Act, 1922 was not restricted to cases where the owner personally worked the plant or machinery. The decisive factors were ownership of the asset and its use in the profit-making business, while the assessee's original intention to operate the press personally was irrelevant. A letting arrangement for industrial plant was treated as business use, and the lessees' repair obligations did not affect the lessor's depreciation claim.

---

---

Issues: Whether the assessee was entitled to claim depreciation on the buildings, plant and machinery of a jute press let out on rent under Section 10(2)(vi) of the Income-tax Act, 1922.

Analysis: The jute press remained the assessee's property and was exploited as a source of business income by letting it out for rent. Depreciation under Section 10(2)(vi) was not confined to cases where the assessee personally worked the plant or machinery; what mattered was that the asset was owned by the assessee and used for the business from which the income was taxed. The fact that the assessee had originally acquired the press with the intention of working it himself was treated as irrelevant. The letting of such industrial plant was treated as business, analogous to the letting of a ship or machinery for hire, and the lessees' liability only for repairs did not deprive the lessor of the allowance for depreciation.

Conclusion: The assessee was entitled to depreciation under Section 10(2)(vi) of the Income-tax Act, 1922; the answer to the referred question was in the affirmative, in favour of the assessee.

Ratio Decidendi: Where business assets remain the property of the assessee and are commercially exploited by letting them for rent, depreciation is allowable if the letting constitutes the business from which the income is assessed.

---