Purchase of electric meters from RSEB and leasing back the same to RSEB is genuine transaction and depreciation can be claimed on such electric meters:

The assessee bought electric meters from Rajasthan State Electricity board (RSEB) and leased them back to RSEB on hire purchase basis. The Department didn’t allow assessee’s claim of depreciation on the said electric meters as it was of the view that the said transaction was a sham transaction in light of the ratio laid down in McDowell’s case (154 ITR 148). It was held by the Hon’ble High Court that the said transaction was a genuine transaction and the assessee was eligible for depreciation on the said electric meters.

[PARAMOUNT POLLUTION CONTROL LTD.  - TAX APPEAL No.166 of 2000 - GHC]