2003 (5) TMI 11

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....sacted some business as in earlier years. During the course of assessment proceedings, the Assessing Officer noticed that the assessee has claimed depreciation in respect of a guest house maintained by the assessee. The Assessing Officer denied that claim. In appeal, the Commissioner of Income-tax (Appeals) was of the view that the assessee has not furnished any evidence to support that the guest house was used for professionals, etc., and held that when the asset, in the nature of guest house, has not been used for the purpose of business, there was no justification for allowing depreciation on such asset. In appeal, the Tribunal followed the decision of the Bombay High Court in CIT v. Chase Bright Steel Ltd. (No. 1) [1989] 177 ITR 124, h....

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....s not been used for the purpose of business and that fact has not been disturbed by the Tribunal. If that asset has not been utilised for the purpose of business, there is no question of allowing any expenditure or depreciation on such asset. Mr. Kothari submits that there is no basis of this finding. We are not concerned at this stage, regarding the finding of fact, whether there is any basis or not. Once, that finding has not been disturbed by the Tribunal, we have to go by the finding given by the Commissioner of Income-tax (Appeals). Otherwise also, the depreciation when specifically denied under sub-section (4) of section 37, cannot be allowed on the basis of section 32 which is a general provision for allowing depreciation. Sub-sect....