Shri K.C. Singhal, Judicial Member - (1.) SINCE common issue is involved in all these appeals, the same were heard together and are being disposed of by common order for the sake of convenience.
(2.) The issue arising out of these appeals relates to the claim of the assessee regarding depreciation in respect of motor vehicles purchased in the name of benamidar and also in respect of vehicles purchased by the assessee but the registration under the Motor Vehicles Act stands in the name of the Vendor. The brief facts giving rise to these appeals are these : In ITA Nos. 1198 to 1203/(PN)/1992 the assessee is an individual while in ITA Nos. 1205 and 1206/PN/1992 the assessee is a partnership firm in which Shri M. R. Mahadik is also a partner. The assessees in the present appeals are engaged in the business of plying trucks/tankers. On 28-9-1988, the premises of Shri M. R. Mahadik and also of the associated concerns in which he was interested were searched under section 132 of the Income-tax Act. Certain incriminating documents, found in the search were seized by the department. The scrutiny of the seized material showed that certain vehicles bearing numbers MXL 7461, MXL 7761, MXL 7861 and MVK 363 were registered in the name of Shri S. D. Patil, employees of Shri M. R. Mahadik. In the letter dated 30-8-1991 before the Assessing Officer it was admitted by Shri M. R. Mahadik that the Motor Vehicles registered in the name of Shri S. D. Patil really belonged to him. Shri S. D. Patil in his statement under section 131 dated 27-9-1991 also admitted that vehicles registered in his name really belonged to Shri M. R. Mahadik. The assessee therefore, offered income relating to these trucks/tankers for taxation in his hands and claimed depreciation in respect of such vehicles. The Assessing Officer included the income in the hands of Shri M. R. Mahadik in respect of the aforesaid vehicles but disavowed the claim of the assessee regarding depreciation on the ground that he was not the legal owner of such vehicles. In support of his stand, he relied on the decisions of the various High Courts in the cases of Parthas Trust v. CIT [1988] 169 ITR 334/38 Taxman 57 (Ker.) (FB), CIT v. Tamil Nadu Agro Industries Corpn. Ltd. [1987] 163 ITR 61/[1985] 20 Taxman 16 (Mad.) and CIT v. Hindustan Cold Storage & Refrigeration (P.) Ltd. [1976] 103 ITR 455 (Delhi).
(3.) IN the case of the partnership firm, i.e., M/s. Mahadik Brothers it was found by the Assessing Officer on the scrutiny of seized material that assessee had purchased vehicle Nos. MWK 1262 and MTL 83 in the name of Shri S. P. Mane. The assessee had stated vide letter dated 30-8-1991 and in the statement dated 13-10-1991 under section 131 of Shri M. R. Mahadik, partner, that the said firm had purchased the vehicles in the name of Shri S. P. Mane out of the funds of the firm. Shri S. P. Mane also in his statement dated 4-10-1991 recorded under section 131 stated that these trucks were purchased in his name by the said firm and he was not the real owner of these vehicles. It was also found that the assessee-firm had purchased 2 trucks bearing Nos. MXL 7722 and MXL 7747 from Shri M. B. Konduskar and registration still continued in the name of the Vendors. The income in respect of these trucks were included in the hands of the partnership firm but the claim of the assessee regarding depreciation was rejected by the Assessing Officer for the same reasons which we have mentioned earlier in the case of Shri M. R. Mahadik.;