TMI Blog1935 (1) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... nce by four instalments of ₹ 5,000 each on the 1st November, 1931, 1st February, 1st May and 1st August, 1932. (b) During the said period of one year, we shall only pay the rents payable to the superior landlords and you shall pay the municipal taxes, Fire Brigade license and all other outgoings and public charges. (c) You shall carry out all repairs to the engines, machineries and plants, godowns and buildings during the said period at your own expenses. The assessee's income from thin source was assessed under Section 12 as income from other sources . He claimed to be assessed under Section 10 as upon profits or gains of business, and to be entitled to an allowance for depreciation under Section 10 (2) (vi). The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a registered company seems to me to be irrelevant. It was decided that where a limited company incorporated for the purpose of milling rice, acting in pursuance of authority given in the memorandum of association leased out the buildings, plant, machinery, etc., to another company for a fixed annual rent, the lessors bearing any loss by depreciation and the lessees being liable for repairs, the company was carrying on the business of letting a rice mill, and was entitled to an allowance for depreciation under Section 10 (2) (vi) of the Income Tax Act. In the case of Sutherland v. The Commissioners of Inland Revenue [1926] 12 Tax Cas. 63, LORD MACKENZIE stated that It is clear, I think from what has already been read from the judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, or the letting of a motor-car or any other kind of machines, or machinery for hire. In Mangalagiri's Case ( supra) the learned Judges pointed out that the Crown would not suffer if an allowance were made to the lessors for depreciation under Section 10 (2) (vi), because under the conditions of the lease, the lessors had to bear the loss caused by depreciation. Therefore a similar allowance for depreciation could not be claimed a second time by the lessees, though they could claim an allowance for repairs for which they were liable under the lease. Similarly in the present case the lessees are liable only for repairs and not for depreciation, and in no circumstances could they claim and allowance for depreciation under Section 10 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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