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2015 (6) TMI 710 - AT - Income TaxDisallowance of depreciation on the motor car - Held that:- For all practical purposes the car was owned by the company. The expenses have been debited in the accounts of the company. A similar issue had come up in the case of CIT vs. Basti Sugar Mills Co. Ltd. (2002 (5) TMI 27 - DELHI High Court) wherein upheld the allowance of depreciation on the car which was not registered in the name of company but used for the business purposes of the company. Also see CIT vs. Navdurga Transport Co. (1997 (9) TMI 35 - ALLAHABAD High Court). Respectfully following these two decisions, we are of the view that assessee has established that for all practical purposes the car was owned by the company and it was used for the business purposes of the company, therefore, the depreciation is admissible to the assessee on the car. - Decided in favour of assessee. Treating the business loss suffered on sale of basement office as a short-term capital loss and allowed the same to be carried forward by CIT(A) - Held that:- Assessee has never accounted this asset as a stock in trade in the accounts, therefore, it can never claim as business loss on sale of the office premises which is otherwise a capital asset. We do not find any error in the finding of ld. CIT(A). - Decided against assessee. Failure to deposit the PF contribution collected from the employees within the due date provided in the P.F. Act - Held that:- This issue is covered against the assessee by the decision of Hon'ble Jurisdictional High Court in the case of G.S.R.T. Corpn. reported in [2014 (1) TMI 502 - GUJARAT HIGH COURT] wherein held that if assessee fails to deposit employees' contribution within the due date provided under the P.F. Act then assessee will not be entitled for deduction. Accordingly, the ld. first appellate authority has rightly confirmed the disallowance. - Decided in favour of revenue. Lease rental income earned from the immovable property - business income OR income from house property - Held that:- The main activity of the assessee was not earning rental income rather it was an activity of trading in the flats. Rental was an incidental income. Similar are the facts of other cases. The main activity of the assessee was not the earning of rental income. The Income-tax Act does not prohibit carrying out earning of rental income as a business income in an organized manner if that be so the income will be assessed as a business income and not under the head 'house property income'. The ld. CIT(A) is not justified in changing the head which was accepted by the AO. In view of the above, the directions of the ld. CIT(A) for taking the remedial action in all other Assessment Years where it is possible as per law is concerned, these directions will automatically be extinguished because rental income in the case of the assessee is to be assessed as business income. Depreciation claim disallowed - Held that:- Ajarmar Flats were purchased by the assessee before 30th September, 2006. Out of 17 flats, 9 flats were actually let out, exhibiting the fact that the asset was ready for use in the business. It is construed that assets were used passively for the purpose of business and, therefore, depreciation is admissible to the assessee. We direct the AO to grant depreciation on the value of these flats. As far as the properties purchased at Eternia Complex is concerned, these purchases were made on 31st March, 2007 i.e. last day of accounting year and the assessee could not bring any evidence on the record demonstrating that these flats were ready for use or giving them on rent. There is no evidence of this on record. Thus there cannot be any passive user of these flats. The assessee is not entitled for depreciation on these assets. We confirm the view of AO on this point - Decided partly in favour of assessee.
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