GRACE COLLIS Vs. COMMISSIONER OF WEALTH TAX

JUDGEMENT

(1.) THE following questions have been, at the instance of the assessee, referred to us by the Income-tax Appellate Tribunal, Cochin Bench :

(2.) QUESTION No. (1) has to be, in the light of the decision of this court in CWT v. Mamman Varghese [1983] 139 ITR 351 (Ker), answered in the affirmative, that is, in favour of the Revenue and against the assessee. We do so.

(3.) THE depreciation deductible from the value of the assets has to be computed strictly in accordance with the rates applicable under the Income-tax Act and the Rules. This is necessarily so, even when the assessee has, for whatever reason, shown in the balance-sheet depreciation which is not correctly computed in accordance with the statute. It is the statutory rate which must be applied for computation of the depreciation and deduction of the same from the value of the assets shown in the balance-sheet. THE value of the assets is what is stated in the balance-sheet, and not any other value, and it is from that value that deduction is made at the statutorily prescribed rate of depreciation.