TaxTMI 
TaxTMI 
1978 (11) TMI 3
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....ntractors. The partners are Thakur Dan Singh and his son, Thakur Mohan Singh. The appeal relates to the assessment year 1958-59, for which the previous year is the financial year ending March 31, 1958. The business was originally carried on by HUF consisting of the aforesaid father and son. There was a total disruption of the family on March 22, 1956, and on the same day the separated members of the family constituted a partnership firm under the name and style of Messrs. D. S. Bist & Sons. The business was taken over as a running concern by the firm. At the time, when the business was owned by the family, it included three trucks. On account of depreciation allowed in earlier years the written down value of two trucks came to nil in the as....
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....would be the same as it was to the HUF and it rejected the contention that the original cost of the three trucks in the hands of the appellant must be taken as nil. In the result, the High Court affirmed that the sum of Rs. 24,252 was taxable in the hands of the appellant by virtue of the second prov. to s. 10(2)(vii). It appears from the judgment of the High Court that the written down value of the three trucks was exhausted while they were still the assets of the HUF business, the written down value of two trucks having been exhausted in the assessment year 1952-53, and that of the third truck having been exhausted in the assessment year 1956-57. Accordingly, when the business was taken over by the appellant the written down value of the....
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....e HUF. In our opinion, it is immaterial that the business was taken over as a running concern. Where a business is taken over as a running concern by an assessee, the cost to it of the assets must ordinarily turn on the value of the assets as on the date of acquisition. There is no material before us evidencing an intention to the contrary. It cannot be disputed that the actual cost to the appellant of the three trucks must be regarded as nil, and that being so no depreciation can be said to have been ever actually allowed to the appellant. It is pointed out by the revenue that the partners of the appellant are the same two individuals who constituted the HUF, and reliance has been placed on the observation of the High Court that in the co....