2026 (3) TMI 640 - SCH - Income Tax

Ownership of Asset determines depreciation entitlement; factual ownership must be examined by tax authorities and judicial interference denied.

Reopening of assessment concerned whether the taxpayer could claim depreciation for a drilling ship allegedly owned by another entity; the court ... Reopening of assessment - depreciation claimed in respect of an asset, which was owned by some other entity - whether respondent is owner of drilling ship ‘Bellford Dolphin’? As decided by HC [2025 (9) TMI 586 - UTTARAKHAND HIGH COURT] whether respondent has wrongly claimed depreciation in respect of an asset, which was owned by some other entity. The notice under Section 148 was also issued to respondent to ascertain the fact, whether respondent is owner of drilling ship ‘Bellford Dolphin’. Although C.I.T. (A) and I.T.A.T. had decided the appeals in which quantum of depreciation allowable to the respondent was in issue, however, the question whether respondent is entitled for depreciation or whether he is owner of the drilling ship, was not considered at all. The question of ownership of drilling ship is a question of fact which could best have been decided by the authorities under Income Tax Act, therefore, we are of the considered opinion that interference made by learned Single Judge in the matter was uncalled for. HELD THAT:- Having heard the learned counsel appearing for the petitioner(s) and having gone through the materials on record, we find no good ground to interfere with the impugned order passed by the High Court. Special Leave Petition is, accordingly, dismissed. Outcome: Special Leave Petition dismissed [No detailed order].