We find it convenient to dispose of three appeals together. Both assessee and department have come on cross-appeals against order of t h e Commissioner (Appeals) for assessment year 1981-82 and department has come on appeal against his order for assessment year 1981- 82. main point to be considered in these appeals is whether assessee is entitled to depreciation in respect of assets which came into their possession by virtue of agreement with another firm by name Fitnut Products, Bharatpur. 2. assessee, private limited company, had entered into agreement on 22-4-1974 with partnership concern Fitnut Products by which assessee contracted to purpose their entire business of manufacturing rivets, screws, ect., with all its assets for sum of Rs. 2,25,000. factory is situated in indusstrial estate in Bharatpur which was given on lease to that firm by Government of Rajasthan. According to that agreement, assessee has to pay Rs. 50,000 in cash, clear off cash credit arrangement with State Bank of Bikaner and Jaipur to extent of Rs. 1 lakh and out of balance amount 50 per cent should be paid within 2 months from date of settlement of civil suit in which vendor firm was involved. second instalment will be paid at time of registration of sale deed. assessee had paid according to stipulations. We were told that civil suit mentioned in agreement of sale had not yet been finalised and, therefore, that part of instalment remains to be paid. No registration of sale deed has been effected so far. 3. assessee was given possession of building, plant and machinery. assessee had also written to Government of Rajasthan with regard to their lease of land on which building is situated. Government of Rajasthan by their order had recognised assessee as lessee in place of Bharatpur firm. 4. From assessment year 1975-76 onwards, assessee claimed depreciation in respect of factory buildings and other assets at Bharatpur. This had been allowed by ITO for those years. However, for assessment year 1980-81, ITO went into question once again. He gave finding that assessee is not entitled to depreciation. He pointed out that conveyance deed has not been registered and, therefore, title to these assets had not been transferred to assessee. assessee cannot be considered as owner of these assets. Therefore, they are not entitled to depreciation. Thus, claim for depreciation allowance in respect of Bharatpur factory was completely disallowed. 5. Commissioner (Appeals) found assessee's claim to be in order. H e pointed out that mere fact that mention was made in sale agreement that regular sale deed would be executed after disposal of civil suit will be no ground for holding that assessee will not be entitled to depreciation on assets purchased by it. He pointed out that possession has been taken by assessee and lease deed has also been executed by Rajasthan Government in favour of assessee. Commissioner relied on decision of Allahabad High Court in case of Addl. CIT v. U.P. State Agro Indstrial Corpn. Ltd. [1981] 127 ITR 97 and held that assessee will be considered to be owner of building under section 32 of Income-tax Act, 1961 ('the Act') if he is in position to exercise right of owner and not on behalf of person in whom title vests, but in his own rights. In that case, he pointed out, it was held that even though registered sale deed was not executed in favour of assessee, assessee would be entitled to depreciation under section 32. He also referred to decision of Calcutta High Court in case of CIT v. Salkia Transport Associates [1983] 143 ITR 39. He allowed assessee's claim. 6. department is in appeal. Shri Radhakrishna Murthy, for department, submitted that agreement should be considered as financing agreement only and not as one conveying property to assessee. He appointed out that agreement contemplates possibility of both parties resiling from conditions agreed on. Referring to provisions found in clause 4 of agreement, he pointed out that Bharatpur firm had right to forfeit Rs. 25,000 in case agreement fell through. assessee is not loser even if this amount is forfeited. assessee would have benefit of using assets and therefore, amount forfeited would be in nature of interest and rent paid for assets. 7. We are unable to consider agreement as financing agreement or hiring agreement. agreement is clearly agreement for sale. assets to be transferred are mentioned therein in Schedule. Full consideration had been paid. As stipulated therein, Government of Rajasthan had been approached and they have recognised assessee as lessee. assessee had taken possession and had used properties for all these years. On these facts, it will be very difficult to say that agreement was merely financial accommodation. Too much cannot be read in clause 4 of agreement. It cannot in any way be treated as agreement for rental of premises and assets. In all agreements, there would be certain conditions on breach of which either party could resile from contract. These are usual conditions found in any sale agreement and it has no further significance. We, therefore, do not consider it in any other light as suggested by department. 8. We also reject Shri Radhakrishna Murthy's suggestion that agreement should be considered as usufructory mortgage. None of conditions required for such mortgage is present. 9. We also reject another submission of Shri Radhakrishna Murthy that ownership cannot be recognised unless assessee would be coming under provisions of section 32(1) (iii ) or 41(2 ) of Act in case of sale. This argument is putting cart before horse. What we have to see is whether any transfer of property has taken place. If it has taken place, then, provisions of these two sections would be automatically invoked in case of any sale effected by assessee. 10. Shri Radhakrishna Murthy then relied on finding of ITO that there was no registration of conveyance deed and, therefore, no property passed. Shri Swamy, for assessee, submitted placing k reliance on Allahabad High Court decision cited by Commissioner that assets have become property of assessee. He pointed out that as per agreement all that assessee has to do has already been done by it and land has been transferred in name of assessee. It is vendor who had been dragging his feet on registration of conveyance and because of vendor's lethargy assessee should not suffer. He also submitted that in earlier years, depreciation has been allowed and department should not be allowed to reagitate this point after so many years. He further submitted that ratio laid down by Allahabad High Court in case cited has been followed by Benches of Tribunal in many other cases. 11. We have considered facts of case. Section 32 allows depreciation in respect of assets owned by assessee. expression 'owned by assessee' is common both in sections 32 and 22 of Act. It is fairly well settled in law what title to immovable property vests only on registration of conveyance deed. In this case, it is admitted position that conveyance deed is not registered. So, under general law, assessee has not become owner of building. 12. Now, position we have to consider firstly is whether under section 32 it will in any way be different from position under section 22. Secondly, we must consider how far decision of Allahabad High Court has altered this position. Taking first point, authorities are unanimous that interpretation in respect of expression 'ownership' appearing in sections 22 and 32 should be identical. It is interesting to note that two decisions relied on by assessee on one hand and department on other start from this common premise that for purpose of sections 32 and 22 ownerhip of properties is vital. In case of CIT v. Hindustan Cold Storage & Refrigeration (P.) Ltd. [1976] 103 ITR 455, case relied on by department, Delhi High Court, proceeding on footing that there is no difference, held that where conveyance deed has not been registered, there is no transfer of ownership in case of immovable properties. Allahabad High Court in case relied on by assessee observed at page 101: "In our opinion, scope of expressions 'property of which assessee is owner'. used in section 9 of 1922 Act and 'the property owned by assessee' used in section 32 of 1961 Act, is same." It will be seen from above that case laws applicable in respect of ownership of property under head 'Income from house property' would be equally applicable in considering provisions of section 32. 13. In case referred to above, Allahabad High Court had held that assessee would be entitled to depreciation under section 32 in respect of immovable properties even without registration of conveyance deed. In arriving at this decision, High Court has relied heavily on decision of Supreme Court in case of R. B. Jodha Mal Kuthiala v. CIT [1971] 82 ITR 570. In that case, assessee was owner of building situated in Lahore. This building was acquired by him by borrowals from banks. After partition, building fell within Pakistan and under Ordinance passed by Pakistan Government, property vested in Custodian of Evacuee properties. annual letting value of such property in hands of assessee was nil. However, assessee was continuing to pay interest and claimed this as deduction. According to assessee, he was owner of property although it was situated in Pakistan and vested in Custodian becuase there was no conveyance deed, and further, he had residual interest in property even under Ordinance. This claim was rejected by all authorities including Supreme Court. After analysing provisions of Pakistan Ordinance, Supreme Court posed question as follows: "The question is, who is 'owner' referred to in this section? Is it person in whom property vests or is it he who is entitled to some beneficial interest in property? It must be remembered that section 9 of 1922 Act brings to tax income from property and not interest of person in property. property cannot be owned by two persons, each one having independent and exclusive right over it. Hence, for purpose of section 9 of 1922 Act, owner must be that person who can exercise rights of owner, not on behalf of owner but in its own right." (p. 575) Allahabad High Court considered position in light of this quotation. They then pointed out that what has to be seen is whether assessee came into position of exercising rights of owner in respect of property on its own behalf and not on behalf of vendor. Pointing out that there was no dispute that full consideration was paid and possession was given to assessee and that there was no right reserved by vendor for itself, High Court held that assessee had exercised all rights of owner and, therefore, was entitled to be considered as owner for purpose of section 32. 14. In course of judgment, they had referred to decision of Delhi High Court in case of Hindustan Cold Storage & Refrigeration (P.) Ltd. (supra). They distinguished that case by stating that attention of Delhi High Court had not been invited to decision of Supreme Court in R. B. Jodha Mal Kuthiala's case (supra). 15. It would, therefore, appear that decision of Allahabad High Court has eroded into concept that title to immovable property vests only on registration of conveyance deed. So, question is whether we have to consider that in respect of immovable property registration of deed is necessary before depreciation under section 32 can be allowed. In other words, question is whether law as laid down by Supreme Court that such registration is necessary in case of CIT v. Supreme Court that such registration is necessary in case of CIT v. Bhurangya Coal Co. [1958] 34 ITR 802, Calcutta High Court decision in case of CIT v. Ganga Properties Ltd. [1970] 77 ITR 637 and Ram Gopal Reddy v. Addl. Custodian Evacuee Property AIR 1966 SC 1438, have been overruled. This identical point, viz., whether earlier decisions of Supreme Court need be followed or not, has been considered by Bombay High Court in case of CIT v. Zorostrian Building Society Ltd. [1976] 102 ITR 499. They came to finding that earlier Supreme Court decisions have not been overruled in any way by later decision in R. B. Jodha Mal Kuthiala's case (supra). following passage occur: "... Supreme Court referred to decision of Calcutta High Court i n In matter of Official Assignee for Bengal (Estate of Jnanendra Nath Pramanik [1937] 5 ITR 233 (Cal.). In that case Clacutta High Court has taken view that official assignee was owner of property of insolvent which vested in him within meaning of section 9 and after referring to cases considered by Calcutta High Court, Supreme Court points out that for determining person liable to pay tax, test laid down by Court was to find out person entitled to that income. It is upon this passage that great reliance is placed by Mr. Kolah. Mr. Kolah has also emphasised that Supreme Court has also pointed out at page 578 that meaning of word 'owner' in section 9 must not be such as to make that provision capable of being 'owner' in section 9 must not be such as to make that provision capable of being made instrument of oppression. It must be in consonance with principles underlying Act. If regard be had to facts of case before Supreme Court it is quite evident that there is nothing in ratio of decision of Supreme Court to indicate that view taken by Calcutta High Court in Ganga Properties Ltd.'s case [1970] 77 ITR 637 (Cal.) or by Bombay High Court in Union Land & Building Society (P.) Ltd.'s case [1972] 83 ITR 794 (Bom.) or by Delhi High Court in S. Kartar Singh's case [1969] 73 ITR 438 (Delhi) should be regarded as impliedly overruled ... property having vested in Custodian, who had all powers of owner, he was legal owner of property. In eye of law, Custodian was owner of that property. It was upon scrutiny of effect of Ordinance that Supreme Court first took view that Custodian should be not regarded as owner and it was in that light test was considered whether assessee was person entitled to income of that property. It will not be possible for us to divorce test of mere receipt of income apart from vesting of property under Evacuee Ordinance. None of decisions on which reliance is placed by Mr. Joshi was cited before Supreme Court and there is nothing in findings of Supreme Court which will persuade us to take view that said decisions should be treated as impliedly overruled. case before Supreme Court has not been decided upon mere fact of having possession and right to receive income. entire provisions of Evacuee Ordinance have been considered and it is after scrutiny of provisions of said Ordinance that view has been taken that evacuee assessee cannot be regarded as 'owner' within meaning of section 9." (p. 514) It will be seen from above that Bombay High Court is of very firm opinion that earlier rulings on this point still hold field. 16. It may be argued that there is difference in approach of Allahabad High Court and Bombay High court and it is not necessary for us t o follow Bombay High Court's views. In this connection, we would refer to decision of Andhra Pradesh High Court, because thier decision is binding o n us. We will refer to decison in CIT v. Nawab Mir Barkat Ali Khan 1974 Tax. LR 90. That was case coming under section 22. assessee had sold certain properties, received full consideration, but had not drawn up conveyance deed. question was whether on those facts assessee would still be considered owner of properties. High Court held that assessee would still be considered as owner of property. Paragraph 19 of order is reproduced below: "In regard to these properties, position of law is clear. In order to constitute sale within meanings of section 54 of transfer of Property Act, there must be transfer of ownership from one person to another. 'A transfer of ownerhip' by person means transfer by such person of his rights and interests in property in full and permanently. It is also not in doubt that transfer of immovable property of value of Rs. 100 and upwards can be made only by registered instrument. It is also equally plain that contract for sale of immovable property does not, of itself, create any interest in or charge on such property. Section 54 of Transfer of Property Act is emphatic in that behalf. What must therefore necessarily follow is that merely because Nizam has received consideration in pursuance of agreement to sell, oral or in writing, it would not amount to transfer of ownership of properties. Nor such agreements create any interest in or even charge on such properties for benefit of purchasers. There can be no such thing in law as title by estoppel. We are therefore satisfied that Tribunal was right in agreeing with view of Income-tax Officer and Appellate Assistant Commissioner that under section 54 of Transfer of Property Act ownership still continues with Nizam and it has not been transferred so far to any purchaser of properties in question." (p. 93) It will be seen from this extract that Andhra Pradesh High Court view is in agreement with Bombay High Court's view. Therefore, it is binding on us. Under these circumstances, we are of opinion that ratio laid down by Allahabad High Court in U.P. State Agro Industrial Corpn. Ltd.'s case (supra) will not be applicable. To this extent we will allow departmental appeal. 17. above does not fully dispose of matters. We can only give finding that title to building has not been transferred to assessee and so depreciation in respect of building cannot be allowed. But, still, question would be whether assessee would be entitled to depreciation in respect of plant and machinery, office equipment and furniture. In respect of these assets, we are of opinion that assessee would be entitled to depreciation. There could be no difficulty with regard to office equipment and furniture. They are movable properties. In movable properties, title passes on possession being given. It is not disputed that assessee was given possession. So, assessee is entitled to depreciation in respect of these two assets. 18. In respect of plant and machinery, there are two possibilities. If plant and machinery are such that they have necessarily to be embedded in earth, then they will take character of immovable property. If they are not embedded in earth, they will be considered as movable property. Since possession has been given, assessee would be considered as owner. For this purpose, finding has to be given whether plant and machinery are embedded in earth or not. No such finding has been given by ITO. It is of course open for us to send matter back to ITO to ascertain facts. But we are of opinion that, considering circumstances of case, it is not feasible to send it back. assessee had been granted depreciation all these years in respect of this property. At no stage has department made out any case that it is embedded in earth. Considering these facts, we are of opinion that it is not necessary to send matter back, and assessee will be entitled to treat plant and machinery as movable property and claim depreciation thereon. 19. In light of our above finding, we are not much persuaded by decisions of certain Benches of Tribunal including our own Bench, in respect of buildings and claim for depreciation thereon, In none of cases cited before us, decision of Andhra Pradesh High Court in case of Nawab Mir Barkat Ali Khan (supra) was considered. 20. above will dispose of departmental appeals for both years. 21. We will now consider assessee's appeal. only point raised is whether assessee would be entitled to deduction of lease rent amounting to Rs. 10,752. Shri Swamy for assessee fairly stated that point has been decided against him by High Court in Reference Case No. 38 of 1980 dated 4-12-1984. So, this point raised by assessee stands rejected. 22. In result, departmental appeals are partly allowed and assessee's appeal is dismissed. *** INCOME TAX OFFICER v. ADITYA MINERALS (P) LTD.