Depreciation claim allowed despite no business activity objection where statutory entitlement and asset ownership were established.

Statutory depreciation was stated to remain allowable where the asset belonged to the assessee and the claim was otherwise permissible under the Income-tax Act, even if the Revenue objected that no business activity was carried on in the year. The analysis further notes that the Tribunal followed its earlier view in the assessee's own case and held that the treatment of the asset in the books of account does not, by itself, defeat the substantive depreciation claim. The depreciation claim was therefore held allowable and the objection based on absence of business activity was rejected.

---

---

Issues: Whether depreciation was allowable to the assessee despite the Revenue's objection that no business activity was carried out during the relevant year.

Analysis: The issue was already decided in the assessee's own case for an earlier assessment year and the Tribunal followed that binding view. The reasoning applied was that depreciation is a statutory allowance under the Income-tax Act and the treatment of an asset in the books of account does not by itself defeat the assessee's substantive right to claim depreciation where the asset belongs to the assessee and the claim is otherwise permissible in law.

Conclusion: The depreciation claim was held allowable and the objection based on absence of business activity was rejected.

Ratio Decidendi: Statutory depreciation cannot be denied merely because the assessee's books or accounts reflect a different treatment or because business activity is disputed, where the claim is otherwise supported by the assessee's substantive entitlement under the Income-tax Act.

---