Depreciation as application of income for charitable trusts remains allowable in pre-amendment years, while disputed receipts were remanded.

For assessment years before the prospective amendment, depreciation on fixed assets used by a charitable trust remained allowable as application of income even where the asset cost had already been treated as application, and the claim was not regarded as a double deduction in those pre-amendment years. The depreciation claim was therefore allowed. Receipts claimed as corpus donations, loss on sale of assets, and refund of caution money were not sufficiently substantiated on the existing record, so those matters were restored for fresh verification and decision on evidence and law. The trust obtained only partial relief.

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Issues: (i) whether depreciation on fixed assets acquired in earlier years could be allowed as application of income for a charitable trust for a year prior to 01.04.2015; (ii) whether receipts claimed as corpus donations, loss on sale of assets, and refund of caution money required fresh examination on the available material.

Issue (i): whether depreciation on fixed assets acquired in earlier years could be allowed as application of income for a charitable trust for a year prior to 01.04.2015.

Analysis: For assessment years prior to the prospective amendment, depreciation on trust assets was allowable even where the acquisition cost had already been treated as application of income. The claim did not amount to impermissible double deduction in such pre-amendment years.

Conclusion: The depreciation claim was allowed in favour of the assessee.

Issue (ii): whether receipts claimed as corpus donations, loss on sale of assets, and refund of caution money required fresh examination on the available material.

Analysis: The assessee had not adequately substantiated the corpus-fund claim or the supporting details for the other disputed items before the lower appellate authority. The proper course was to restore these matters for verification and decision on the basis of evidence and law.

Conclusion: These issues were remitted for fresh consideration.

Final Conclusion: The assessee succeeded on the depreciation issue, while the remaining issues were sent back for fresh adjudication, resulting in only partial relief.

Ratio Decidendi: For charitable trusts, depreciation on assets remains allowable as application of income for pre-amendment years, even if the asset cost was earlier treated as application of income; disputed factual claims may be remanded for verification where substantiation is incomplete.

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