527. For the purposes of sections 93 to 104, 130 and 130.1 and of any regulations made for the purposes of paragraph a of section 130, where Divisions I and II or Division IV apply in respect of the disposition of depreciable property to a person and the capital cost to the transferor of the property exceeds the transferor’s proceeds of disposition of the property, the following rules apply:(a) the capital cost to the transferee of the property is deemed to be equal to the amount that was its capital cost to the transferor; and
(b) the excess is deemed to have been allowed to the transferee as depreciation in respect of the property for the taxation years that ended before the time of disposition.