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2015 (5) TMI 271 - HC - Income TaxDepreciation claim - AO disallowed claim as the assessee was unable to demonstrate that the machinery claimed to have been used by it was in fact owned or acquired by assessee for its business - assessee's contention was that the machinery was provided to sub-distributor at that site for use by the customers - Held that:- As correctly held by ITAT the assets qua which the depreciation is claimed were not purchased during this year, but in earlier years. Purchases and depreciation thereon have been allowed in earlier years.It is undisputed that they were purchased in earlier years i.e. in A.Y. 2006-07 and 2007-08 besides depreciation was allowed and the assessments were framed u/s 143(3). The impugned assets became part of the block of assets and any question in subsequent year about the ownership is meaning less, therefore, we are unable to sustain the finding of the assessing officer that assets were not owned by the assessee. The subsequent upgradation of the software and machinery etc. though may be with the sub distributor the fact remains that the assessee's assets were also used. The impugned assets were used for the purpose of the assessee's business, therefore, depreciation is to be allowed. Also find force in the argument of ld. Counsel for the assessee that assuming worst against the assessee the assets being the part of the existing block of assets on such presumption also become assets already part of the block of assets kept in readiness for use of the business, the depreciation is to be allowed. No substantial question of law arises - Decided against revenue.
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