TaxTMI 
TaxTMI 
2005 (7) TMI 67
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....r for the purposes of claiming depreciation, which according to the assessee-appellant is a substantial question of law and arises in the present appeal from the order of the Income-tax Appellate Tribunal dated May 18, 2004. The merit or otherwise of this submission would have to be decided keeping in view the facts of the case and thus it will be proper to narrate the basic facts giving rise to the present appeal at the very outset. The appellant had filed a return of income for the assessment year 2001-02 declaring income of Rs. 2,04,160. During the relevant financial year, the appellant claims to have purchased a Toyota Qualis vehicle for a sum of Rs. 7,64,553 and claimed an amount of Rs. 76,453 as depreciation on the said vehicle. It....
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....ok for the car or call register for the telephones was maintained. It is also admitted that telephones expenses included charges on account of telephones installed at the residences of the directors. I am of the view that in these circumstances exclusive business use of vehicles and telephones is not established. Every person including a company has to establish that the expenditure claimed in its income tax proceedings has been incurred wholly and exclusively for the purposes of business in terms of section 37 of the Act. The onus is on the appellant to substantiate the claim of admissibility of the expenditure. In the case of New Ambadi Estates Pvt. Ltd. v. State of Tamil Nadu [2002] 256 ITR 64 (Mad), which was also the case of a company,....
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....[1999] 239 ITR 775 contended that the findings recorded by the authorities are perverse in law inasmuch as the dominion over the car vested in the company and the records clearly reflected its utility and benefit to the advantage of the company, as such it ought to have been treated as an asset of the appellant and consequently granted the allowance for depreciation. On the other hand, learned counsel appearing for the respondent while relying upon the judgment of the Supreme Court in the case of Tamil Nadu Civil Supplies Corporation Ltd. v. CIT [2001] 249 ITR 214 refuted the submission made on behalf of the petitioners and argued that the condition precedent to claim of depreciation is ownership of the asset. In the present case, the regis....
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....see's claim for depreciation thus was allowed in the case of Mysore Minerals Ltd. [1999] 239 ITR 775 (SC). That case has no application to the facts of the present case. In the present case, a finding of fact has been recorded by the Assessing Officer, Commissioner of Income-tax (Appeals) and lastly by the Tribunal that the assessee-company had no ownership or dominion over the vehicle in question. The ownership of an asset in his personal capacity by the director of the company, cannot be an asset deemed to be in the vested ownership or beneficial utility of the company. They are two distinct and independent legal entities. This is not a question of law, but is primarily a question of fact. All the three authorities have given additional r....