Law:

Section:

(a) Income-tax-----Depreciation--Claimant of depreciation must be owner of the asset--Fractional claim for depreciation is not admissible. (b) Income-tax----Profit--Assessability--Amount which the assessee received under compromise or by amicable arrangements was in the nature of profits to be received by the assessee for the interest of business and, therefore, constituted taxable income. (c) Income-tax--- ---Depreciation--Assessee alone is entitled to maintin claim of depreciation--No separate value of a part of the asset of depreciation can be worked out--Book value as shown must be applicable to the entire assets of the firm including the percentage of share one partner had given to the other partner. JUDGMENT Civil Appeal No.850 of 1973 RANGANATH MISRA, J.--This appeal is by certificate and is directed against the judgment of the High Court of Allahabad. The assessee and his five brothers constituted a Hindu joint family. The relevant assessment year is 1953-54, corresponding to the accounting period ending on June-30, 1952. The joint family owned, inter alia a sugar factory at Bijnore. In 1930, there; was a partition in the family and the members of the erstwhile joint family constituted themselves into a partnership firm which took over the sugar factory and operated the same. In the year 1944, Sheo Prasad, one of the brothers, who was a partner of the firm instituted a suit in the Lahore High Court for dissolution of the firm. Partition of the country followed and after the parties shifted over to India, a fresh suit was instituted at Bijnore for purposes of partition. The properties were put in charge of a receiver appointed by the Court. So far as the sugar factory was concerned, the arrangement was that at five yearly rests, an auction was to be held confined to the partners and the highest bidder would be given lease to operate the factory for that period under the receiver. On July 16, 1948, Sheo Prasad transferred his 1/6th share to Banarsi Dass at a stated valuation of Rs.4,50,000. On May 3, 1950, another brother, Devi Chand, leased out his 1/6th share to Banarsi Dass on an annual payment of Rs.50,000. On July 13, 1950, yet another, brother,…

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