2020 (11) TMI 413 - ITAT BANGALORE

Depreciation on Car - Claim not allowed on the reason that the assessee's hotel business is not in operation and not earned any revenue from hotel business - HELD THAT:- As in the case of CIT Vs. Kriti Resorts (P) Ltd. [2011 (7) TMI 39 - HIMACHAL PRADESH HIGH COURT] when the business is not in operational, the assessee can also claim depreciation.

The assessee company is in existence under the Companies Act and it has to fulfill various statutory compliances and it is not disputed that the assessee is earning income from F & O business and other sources. The same was offered for tax. Unless and until the assessee is ceased to exist, the assessee is entitled for depreciation on assets which was included block of assets. For granting depreciation, it is not mandatory for assessee to have revenue from Hotel Business. In the present case, the Assessing Officer himself has allowed maintenance of Car expenditure however disallowed depreciation on the same which is not correct. In our opinion, the assessee is entitled for depreciation as per Income Tax Act which has to be granted. We allow the appeal of the assessee.