Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2012 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (11) TMI 142 - AT - Income TaxDisallowance of depreciation on the leased assets - Finance lease vs Operating lease - Held that:- As it appears that the assessee is not interested in pursuing the appeal. It has been held by the Hon’ble Supreme Court in the case of B.N. Bhattachargee and Anr. (1979 (5) TMI 4 - SUPREME COURT) that appeal does not mean only filing of memo of appeal but also pursuing it effectively. In cases where the assessee does not want to pursue the appeal, Court/Tribunal have inherent power to dismiss the appeal for non prosecution - against assessee. It is not a case of operating lease and hence no granting of depreciation - Held that:- As decided in M/s.IndusInd Bank Limited Versus ADCIT [2012 (3) TMI 212 - ITAT MUMBAI] Only the lessee can be treated as owner of the asset in case of a finance lease and is entitled to claim depreciation as per law. No depreciation can be allowed to the lessor in case of a genuine finance lease - Finance lease is for a fixed period & non-cancellable. Lessee uses the asset for its entire economic life & all risks and rewards incidental to ownership are transferred to the lessee even though title may or may not be eventually transferred to him. There is a fixed obligation on the lessee for payment of lease money. As no distinguishing feature brought on record, it is fair and reasonable that the matter should go back to the file of the A.O. to decided afresh - in favour of revenue by way of remand.
|