TMI Blog1994 (4) TMI 64X X X X Extracts X X X X X X X X Extracts X X X X ..... -85 to 1987-88, their claim for depreciation allowance to the extent of each of their shares was initially allowed by the Assessing Officer. Subsequently, by an order under section 154 of the Income-tax Act, 1961, the depreciation allowance was withdrawn on the basis of the decision rendered by the Supreme Court in Seth Banarsi Dass Gupta v. CIT [1987] 166 ITR 783. The assessees successfully challenged the rectification order before the Deputy Commissioner of Income-tax. The appeals were allowed by the Deputy Commissioner on the basis of an earlier decision rendered by the Hyderabad Bench of the Income-tax Appellate Tribunal in Income-tax Appeal No. 397/ (Hyd.) of 1982. Aggrieved by that, the Revenue carried the matter in appeal to the Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cided by the Supreme Court in Seth Banarsi Dass Gupta's case [1987] 166 ITR 783. The relevant clause (vi) of sub-section (2) of section 10 of the Indian Income-tax Act, 1922, which fell for consideration before the Supreme Court was in the following terms : "In respect of depreciation of such buildings, machinery, plant or furniture being the property of the assessee. . . . " The Supreme Court observed that (at page 787) : "there is hardly any scope for doubt that the benefit of section 10(2)(vi) of the Act (1922 Act) would be admissible only where the assessee is the owner of the property. It too is not admissible in respect of a fractional claim". Section 32 of the Income-tax Act, 1961, in so far as it is relevant, is in the following ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the successor assessing authority. Whether a subsequent decision can be the basis for "rectifying" an earlier order in exercise of the powers under section 154 of the Income-tax Act ? Although the opening words of section 154(1)-"with a view to rectifying any mistake apparent from the record, the income-tax authority. . . ." may give the impression that a judgment which came subsequently, not being part of the record at the time when the assessment was finalised, could not be the basis for rectification of any mistake under section 154, the legal position is no longer in doubt in view of the authoritative pronouncement of the Supreme Court in S. A. L. Narayana Row, CIT v. Model Mills Nagpur Ltd. [1967] 64 ITR 67. In that case, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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