SC allows Depreciation on Leased Assets as Actual Physical Use Not Mandatory

CIT (LTU) Vs Tata Motors Ltd. (Supreme Court of India) The dispute before the Bombay High Court concerned whether the assessee was entitled to claim depreciation under Section 32 of the Income-tax Act on assets given on lease and whether interest under Section 220(2) could continue after reassessment proceedings. The Revenue challenged a common order of the Income Tax Appellate Tribunal relating to assessment years 1994-95 to 1997-98. The Assessing Officer had disallowed depreciation claimed on leased assets on the ground that the lease arrangements were merely financial transactions and that ...