JUDGMENT
By the Court
Heard learned counsel for the parties.
2. This is an application under section 256(2) of the Income Tax Act, 1961, requiring this court to direct the Appellate Tribunal, Jaipur Bench, Jaipur, to state the case and refer the following two questions of law said to be arising out of the Tribunals order, dated 8-1-1991, passed in ITA No. 5/Jp/1990 and 1611/Jp/1989 for the assessment year 1987-88 :
(1) Whether, on the facts and in the circumstances of the case the Tribunal was legally justified in directing to allow depreciation on the vehicles which were not registered in the name of the assessee-firm ?
(2) Whether, on the facts and in the circumstances of the case, the Tribunal was legally right in observing that assessment framed in the case of this assessee should be treated as substantive and not protective specially in view of the fact that while completing the assessment in the case of firm consisting of 6 partners has established beyond doubt that assessee-firm was only benami of M/s Mohd. Bux Shokat Ali 6 partners ?
3. The first question relates to allowing the depreciation on the vehicles in the assessment of the firm where the vehicles were not registered in the name of the assessee-firm but were registered in the name of one of the partners of the firm. The Tribunal has refused to refer the aforesaid question while rejecting the application under section 256(1).
4. Learned counsel for the revenue has urged that since similar question has earlier been directed by this court to be referred in DB IT Ref. Appln. No. 31/of 1998
5. It has been brought to our notice by the learned counsel for the respondent that the principle has been settled by the Supreme Court while considering the question of ownership of an asset subject to claim of depreciation allowance under section 32 of the Act in Mysore Minerals Ltd. v. CIT (1999) 11 DTC 387 (SC) : (1999) 239 ITR 775 (SC), wherein the court was considering the case of building which was in possession of the assessee-company, the possession having been acquired on payment of price but actually deed of conveyance was not executed by the Housing Board in favour of the company, thus there was no vesture of legal title of the company in terms of the Transfer of Property Act required for transfer of ownership. Yet considering the meaning of word “owned” as used in section 32, the court answered the question. The court posed a question for itself :
“It is the word owned as occurring in sub-section (1) of section 32 which is the core of controversy. Is it only an absolute owner or an owner of the asset as understood in its legal sense who can claim depreciation ? Or, a vesting of title short of full-fledged or legal ownership can also entitle an assessee to claim depreciation under section 32 ?”
Then the court after considering the various aspects of the terms ownership concluded that:
“In our opinion, the term owned as occurring in section 32(1) of the Income Tax Act, 1961, must be assigned a wider meaning. Anyone in possession of property in his own title exercising such dominion over the property as would enable others being excluded therefrom and having right to use and occupy the property and/or to enjoy its usufruct in his own right would be the owner of the buildings though a formal deed of title may not have been executed and registered as contemplated by Transfer of Property Act, Registration Act, etc. . . . . . .”
6. It is well settled that there cannot be two owners of the property simultaneously and in the same sense of the term. The intention of the legislature in enacting section 32 of the Act would be best fulfilled by allowing deduction in respect of depreciation to the person in whom for the time being vests the dominion over the building and who is entitled to use it in his own right and is using the same for the purposes of his business or profession. Assigning any different meaning would not subserve the legislative intent.
Thus the principle has been settled by the Supreme Court and on the application of the aforesaid principle the answer in the present case to the question raised is self-evident on the facts found by the Tribunal. We, therefore, declined to require the Tribunal to refer the aforesaid question of law to this court notwithstanding that it is being a question of law.
7. It may be noticed that merely because a question of similar nature has earlier been referred to this court by the Tribunal or has been made subject-matter of reference by issuing direction under section 256(2) neither operates as res judicata nor binds the court at later stage to answer that question if the court is of the opinion that no question of law arises.
8. So far as the second question is concerned, the same is founded on the basis of findings recorded by the assessing authority that the respondent-firm is a benami for another firm of M/s Mohd. Bux Shokat Ali consisting of six partners only. This finding of the assessing authority has also been upturned by the Tribunal by holding that the firm consisting of eight partners is a genuine firm and not benami. The finding on the question whether the firm is a genuine is finding of fact and gives rise to no question of law except in cases where the finding has been challenged to be perverse or based on no material or on irrelevant considerations. Such being not the case, in our opinion, the Tribunal was right in rejecting the application under section 256(1) in respect of second question also.
Accordingly, this application fails and is hereby dismissed.
No orders as to costs.