dissallowance of building depriciation

[anil sharma]

SIR.....PLEASE SOLVE MY QUERIES. I HAVE ONE BUILDNG AND THE ASSETS WAS USED PARTLY FOR BUSSINESS PURPOSE AND PARTLY WE HAVE GAVE ON RENT IN ASS. YR. 2007-2008 .WE Have CLAIMED FULL DEPRICIATION ON BUILDING AND ALSO SHOW RENTAL INCOME OF BUILDING UNDER HOUSE PROPERTY INCOME. NOW A.O SEND ME A DEMAND NOTICE U/S 143(3). IN THIS NOTICE A.O DISALLOWED 60% OF DEPRICIATION.....I DON'T KNOW HOW A.O GET THIS PERCENTAGE... SIR PLEASE SOLVE MY PROBLEM AS SOON AS POSSIBLE .... AND GIVE A REFREANCE OF CASES LAW ALSO, RELATED TO THIS QUERY AND TELL ME YOUR VEIWS, HOW I CAN ALLOWED THE FULL PART OF DEPRICIATION.

[DR.MARIAPPAN GOVINDARAJAN]

Whether you have got clarified in the above issue? If not please inform.

AI Summary

Apportionment of depreciation: mixed-use buildings require proportionate allocation of depreciation to business use, not whole-asset claims. Apportionment of depreciation arises where a single building is used partly for business and partly let out; the issue is whether the assessee may claim full depreciation on the entire asset while treating rental receipts separately. The assessing officer disallowed the portion of depreciation attributable to the let-out use. The operative requirement is evidentiary and accounting allocation showing extent of business use; depreciation for mixed use is generally apportioned pro rata to the business portion unless a lawful basis for whole-asset depreciation is demonstrated.