As per the decision of Punjab & Haryana High court in case of CIT v/s Pepsu Road Transport corpn. (2002) 121 Taxmann 232/ 253 ITR 303 If a machine is ready for use at any moment in a particular factory,the machinery can be said to be "used" for the purpose of business, although in fact it had not worked during the year.So assessee can claim depreciation on assets ready for use.
Now as per the decision given by Bombay High Court in case of Dinesh Kumar Gulabchand Agrawal v/s CIT (2004) 267 ITR 769 It was held that expression "used" means "actually used" for the purpose of business and not merely ready for use.Hence,depreciation shall not be allowed unless the asset is actually used for the business.
My question is which decision should be followed and why?
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