A company can claim depreciation on cars used for its business purposes even if the same is registered in the name of its director:

AO disallowed assessee’s claim of depreciation on cars on the count that the cars were registered in the name of a director of the assessee-company. He was of the view that the assessee-company had no dominion on such car and further, there was no material to show that the use of such car was for the purpose of the assessee-company’s business. The Hon’ble ITAT observed that the said car was purchased out of the funds of the assessee-company and the same was reflected in the Balance-sheet of the assessee-company. It was held that requirement of S.32 is that the vehicle must be owned by the assessee and not that the vehicle must be a “Registered owner” of the same under The Motors Vehicles Act. Accordingly, the assessee-company was eligible for depreciation on such car.

[SWATI AUTOLINK PVT. LTD. Vs. ITO – ITA NOS.1471/Ahd/2010]