The HC affirmed that the assessee is not entitled to...

The HC affirmed that the assessee is not entitled to depreciation under s.32 because it did not become an "owner" (wholly or partly) of the common infrastructural assets; a long-term leasehold or usage right does not satisfy statutory ownership required for claiming depreciation. The court upheld the disallowance of depreciation but held that the contribution towards infrastructure is not a capitalizable enhancement of building; instead, given contractual refundability diminishing at 5% per annum, the amounts must be amortised and treated as revenue deductions to the extent they crystallise (5% per annum) when they become non-refundable. The Tribunal's rejection of the revenue claim was disturbed to that extent; overall decision on depreciation was against the assessee.