J.L. Gupta, J. - (1.) THESE three cases have been placed before this Bench on a reference by the Division Bench. First, a few facts.
(2.) ON November 22, 1974, the respondent -assessee entered into an agreement and took over the assets and liabilities of Abrol Engineering Company. It paid a consideration of Rs. 2,87,969. The land standing in the name of the vendor was mutated in the revenue records in the name of the assessee -company. However, a registered instrument of conveyance had not been executed. In the return of income filed by the assessee for the assessment year 1978 -79, it claimed a depreciation of Rs. 18,507. The Income Tax Officer disallowed the claim. He found that the claim for depreciation could not be accepted as a registered instrument of conveyance had not been executed. Aggrieved by the order, the assessee filed an appeal. The Commissioner of Income Tax (Appeals) relying on the order dated May 21, 1981, passed by the Tribunal in Income Tax Appeals Nos. 222 and 223 (ASR) of 1980 for the assessment years 1976 -77 and 1977 -78 in the case of the assessee allowed the appeal. The Revenue appealed. However, the challenge was declined by the Tribunal.
(3.) THE Revenue filed an application under Section 256(1). On a consideration of the matter, the Tribunal referred the following question for the opinion of this court : "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee is entitled to claim depreciation on the building although the transfer of the building was not effected by means of a registered instrument".;